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US Airways files to reject labor agreements

Bankrupt US Airways Friday said it has filed a motion in bankruptcy court to reject labor agreements with its flight attendants, communications workers, and machinists and aerospace workers.
/ Source: Reuters

Bankrupt US Airways Friday said it has filed a motion in bankruptcy court to reject labor agreements with its flight attendants, communications workers, and machinists and aerospace workers.

The motion also seeks to reduce retiree benefits and to terminate defined benefit retirement plans and "substantial reductions or elimination" of retiree health benefits

The Arlington, Virginia-based No. 7 U.S. carrier said the filing with the U.S. Bankruptcy Court for the Eastern District of Virginia does not preclude it from obtaining consensual agreements with the three unions and other parties.

The airline said it is in various stages of negotiation with the Association of Flight Attendants, the Communications Workers of America and the International Association of Machinists and Aerospace Workers.

Last month, the pilots union at US Airways approved a $300 million concession package, including pay cuts of 18 percent, to help the ailing carrier survive its second bankruptcy in two years.

The carrier filed for protection from creditors after being hurt by low-cost rivals, soaring fuel prices and a failure to win givebacks from its unions.