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Understanding the Bankruptcy process:
Interim Relief: US Airways has filed a motion under Sec. 1113(e) of the Bankruptcy Code seeking emergency interim relief from the terms of our collective bargaining agreement. If the Company can prove to the court that the relief requested (including the Company's proposed 23% pay cut) is essential to allow the Company to continue operating during the bankruptcy, then the court would grant the motion. AFA is therefore engaging in negotiations with the Company to try to reach agreement on a package of interim relief sufficient to keep the Company operating and still avoid court-imposed cuts that could be far worse. This is called interim relief because it is meant to be temporary, cutting the Company's costs to allow it to continue to operate from now until permanent changes to the agreement can be negotiated or are imposed by the Court. Because the Company maintains that it needs this interim relief simply to be able to keep operating, they are seeking relief that is primarily in the form of immediate cash cost cuts that would have an immediate impact on the Company's bottom line.
Transformation Plan: For weeks AFA, ALPA and others have been negotiating with the Company over changes that management has proposed as part of the Company's Transformation Plan. This Plan is designed to make long-term changes at the Company to address the continued losses that have put us back into bankruptcy. For AFA and the other labor groups, management's Transformation Plan has proposed far-reaching changes and deep cost cuts for our collective bargaining agreements. The direct pay cut might actually be smaller than the 23% cut proposed by the Company as interim relief because the Transformation Plan includes more cuts in other areas that would offset some of the direct pay cut.
How this All Fits Together: As the date of the hearing on the Company's motion approaches later this week, we have begun to shift our focus in the negotiations. We have been working on the Transformation Plan agreement, seeking long-term solutions that the Flight Attendants can live with and which will allow the Company to re-build and emerge from bankruptcy. Because the Company's negotiating committee has been tied up in negotiations with ALPA, they have not been able to focus the necessary time and effort on the many complex issues on the table for a long-term Transformation Plan. While we remain hopeful that such an overall agreement could be reached in time, we have decided to address the issues raised by the Company's motion for Interim Relief in a separate proposal. If we cannot reach a tentative agreement on a Transformation Plan agreement (which is what ALPA has done), we would hope to at least have an agreement on Interim Relief before the court hearing on the Company's motion. An agreement would allow us to have some control over the size and the nature of the cuts, control that would be lost if the Company persuades the court to impose interim relief pursuant to its 1113(e) motion.
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AFA Local Numbers
Council 40 PIT 724-695-3329
Council 41 DCA 703-690-6859
Council 69 BOS 978-352-7401
Council 70 PHL 215-492-0840
Council 82 LGA 201-803-6141
Council 89 CLT 704-527-0325
New Hotline Number Toll Free: 866-USA-AFA2
US AIRWAYS Benefits Information 800-872-4780
Reply to Inflight: askinflight@usairways.com
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