Labor negotiations tough for United

The tail of a United aircraft


Steve Chiotakis: United Airlines is in the midst of negotiations with many of its labor unions. It'll meet today with the union representing its mechanics. It's re-negotiating contracts that were agreed to during its bankruptcy three years ago. The latest now, from Marketplace's Jeremy Hobson.

Jeremy Hobson: Last year, it was astronomical fuel prices dogging the airline industry. Now it's a demand problem, and that hits the big carriers, like United, the hardest.

Seth Kaplan of Airline Weekly says both sides are in a difficult position as negotiations get underway:

Seth Kaplan: United's going to say look, fuel is falling, but demand is also really falling, and we don't know where things are going -- we don't have enough visibility to know that we're going to have the revenue to be able to give you the kinds of compensation that you want.

United slashed employee pay and benefits during reorganization. And Kaplan says workers are through making sacrifices for the good of the company. Even if there's a promise of rewards in the future.

Kaplan: United just can't do that kind of thing. Employees are going to look to take whatever they can get right now, because they just don't trust that management later is going to take care of them.

Still, Kaplan says a strike is unlikely. And given the current job market, workers may have to endure another delay.

In New York, I'm Jeremy Hobson for Marketplace.

About the author

Jeremy Hobson is host of Marketplace Morning Report, where he looks at business news from a global perspective to prepare listeners for the day ahead.


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