CHICAGO (Reuters) - U.S. airline labor unions, hungry to reclaim wage and benefit concessions, are busily issuing demands in exchange for their support for a potential merger, as they try to influence back-room talks.
Delta Air Lines Inc (DAL.N) has reportedly been in talks with Northwest Airlines Corp NWA.N and United Airlines parent UAL Corp UAUA.O about a potential merger since mid-January. But the airlines have yet to publicly acknowledge the talks.
The pilots of Continental Airlines Inc (CAL.N), which also is seen as a tempting merger partner, are preparing for a potential merger and plan to have a say in any deal.
“We will not stand idly by and allow a change in the airline landscape without taking steps to protect the interests of our pilots,” Tom Donaldson, chairman of Continental’s pilots’ union said in a statement late Thursday.
Also on Thursday, the pilots of Northwest said they would support a Northwest merger with another carrier if the workers received a stake in the combined airline. Those pilots are represented by the Air Line Pilots Association (ALPA).
Northwest’s flight attendants, which like the carrier’s pilots were forced to accept deep wage cuts while Northwest was in bankruptcy protection, said they also would demand a stake in a combined airline, as well as job protection and higher wages for its members.
The carriers’ employees are nervous, as any deal could result in job losses and upset seniority rankings — a key concern of airline employees.
Unions also see consolidation as an opportunity to claw back some of the hundreds of millions of dollars of wages and benefits lost during the industry’s five-year slump, which ended in 2006.
ALPA, which also represents pilots at United, said it would resist a merger if its interests were ignored.
“United pilots will not rubber stamp any merger unless and until our interests are addressed. We are prepared to protect the careers and futures of our pilots in the event of any merger or consolidation scenario,” Steve Wallach, chairman of United’s ALPA chapter said in a statement last week.
The International Association of Machinists and Aerospace Workers, which represents ground workers at United and Northwest, sent a letter last week to the chief executives of both of those airlines warning them not to use labor savings won in their respective bankruptcies to fund a merger that could harm union members.
But in the face of surging oil prices and a softening U.S. economy, their chances for big gains may be slim.
“It’s correct for unions to strut their stuff. That’s what they should do. But they don’t have a lot of say in the matter,” said airline consultant Michael Boyd on Friday.
“When you’re talking about union demands in regards to a regular airline merger, it’s like the Titanic crew wanting a better deal as the ship goes down,” he said.
Reporting by Kyle Peterson, editing by Gerald E. McCormick