Northwest Airlines Corp. and its baggage handlers and ramp workers reached a tentative agreement early Friday aimed at slashing the bankrupt airline’s labor expenses, union and airline officials said.
Terms of the tentative agreement and the schedule for a ratification vote were being prepared for distribution to members of the union representing about 5,600 ground workers.
“The negotiating committee unanimously recommends ratification of the agreement to avoid the elimination of our contract,” said Bobby DePace, president of District 143 of the International Association of Machinists and Aerospace Workers.
“We are not recommending ratification because the terms are favorable, but because the alternative is worse,” DePace said in a statement.
The union will also hold a simultaneous strike authorization vote in case the tentative agreement is rejected and the union contract is nullified by the court, DePace said.
Northwest Airlines said it was pleased the sides reached an agreement. “We hope that our equipment service employees and stock clerks will ratify the agreement,” the airline said in a statement.
The agreement came hours before a bankruptcy court hearing in New York, where Judge Allan Gropper was to consider whether to allow Northwest to throw out the union contract and impose its own terms.
Bankruptcy law allows companies to reject their union contracts with a judge’s permission, a threat that prompted pilots and flight attendants to also make deals.
The ground workers had rejected an earlier wage-cut and layoff offer.
Northwest has been seeking concessions from its workers to exit bankruptcy, including $190 million in payroll savings from the baggage handlers’ union. Northwest says it has among the highest labor costs in the airline industry.