Labor uncertainty is threatening the future of regional airline Comair, its president said Monday as the Delta subsidiary sought bankruptcy court permission to void its contract with flight attendants.
Comair Inc. and its flight attendants have been negotiating for more than six months over the last unresolved contract among the bankrupt airline's unions. Pilots and mechanics had reached agreements, but the company said those deals - which cannot take effect until all unions reach a new agreement - may now need to be renegotiated. Those deals were contingent on an October deadline to execute an overall restructuring plan.
The company was in court Monday to decide a second request to impose changes in work duties and wage cuts on its 970 flight attendants. The first such motion was rejected in April by U.S. Bankruptcy Judge Adlai Hardin, who said the company had not bargained in good faith.
The hearing was scheduled to continue Tuesday.
"The inability to reach agreement with the (union) and achieve competitive cost levels in the near-term is robbing Comair of the opportunity to compete for new flying," President Don Bornhorst said.
He said the "shrinking" air carrier has lost chances to bid for contracts with Northwest Airlines Corp. and Continental Airlines Inc., both of which cited Comair's labor situation as a weakness. He said regional carriers as a group are suffering from lower demand, and that Comair has returned six planes and so far this year had parked 10 others.
Bornhorst said it urgently needed to reduce its operating costs and that its wages, even after the cuts, would be the highest among flight attendants at rival regional carriers.
Erlanger, Ky.-based Comair said its latest proposal improves on the last one by softening the impact on take-home pay and instead changing certain work rules, such as requiring attendants on all flights to tidy up the cabin at the end of a flight.
The airline is proposing $7.9 million (euro6.2 million) in concessions, which is $1 million (euro780,000) less than the last proposal. The company seeks a 7.5 percent reduction in average pay.
The International Brotherhood of Teamsters, which represents the flight attendants, seeks a 7 percent wage reduction.
The union also argued that the proposed plan for $7.9 million (euro6.2 million) in cuts was actually worth $10 million. It has proposed its own plan worth $8.4 million (euro6.6 million) in cost savings.
The flight attendants have authorized a strike if their contract is voided.
Comair is a wholly owned subsidiary of Delta Air Lines Inc., and filed for Chapter 11 protection in September. Together they operate 850 flights to 108 cities on a daily basis.
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