WASHINGTON (AFP) - US Airways, taking punishing losses, asked a bankruptcy judge to let it scrap deals with three unions, terminate pensions with set payouts, and slash health benefits.
US Airways filed the request with the US Bankruptcy Court for the Eastern District of Virginia.
It asked the court to reject existing agreements with the Association of Flight Attendants, the Communications Workers of America and the International Association of Machinists and Aerospace Workers.
The airline said it was still in talks with those three unions to cut pay and costs, and it would prefer to reach a deal with them rather than impose a court-approved resolution.
US Airways had already agreed on 21-percent pay cuts and lower benefits with the pilots and with three other worker groups represented by the Transport Workers Union.
Those deals were approved by the bankruptcy judge October 15.
"Our overwhelming preference is that we continue to negotiate and reach agreements with all of our unions," airline president and chief executive Bruce Lakefield said in a statement.
But the filing was necessary to restructure the airline in light of "financial issues" facing the company early in 2005, he said.
If the request is approved, the airline could impose its most recent offer. Both sides would have to carry on negotiating a deal, however.
US Airways also asked the judge to allow it to terminate "defined benefit" pension plans for flight attendants, machinists and aerospace workers. The carrier also would end similar plans, frozen in the early 1990s, that covered a slew of other employee sectors.
The airline would then work with the state Pension Benefit Guaranty Corporation to adminster the plans' assets and benefits.
"US Airways intends to only have defined contribution pension plans for all employees," the company said.
US Airways also asked the judge to approve "substantial reductions or elimination" of company-paid retiree health benefits for all employees, including management.
"We have not lost sight of the hardships that furloughs, lower pay and reduced benefits will mean for our employees and retirees, but we are faced with a series of difficult choices as we work to restructure the company and try to save thousands of jobs of veteran US Airways employees," Lakefield said.
"We can complete this process more quickly and with a much better outcome for employees if we can reach labor agreements prior to going to court on this motion," he said.
"This filing represents a final request to union leaders to work with us, and to convey to their members the serious predicament our company faces."
US Airways filed for Chapter 11 protection in September, less than 18 months after emerging from its 2002 bankruptcy filing, after failing to win sufficient concessions from its unions.
11/12/2004 - 19:39 GMT - AFP