3,000 White-Collars to Lose 5 to 15%

Northwest's CEO, Richard Anderson (right), wrote his managers last week, "It's our responsibility to find effective and fair solutions that will enable Northwest to achieve profitability once again. It requires that we all share in the salary and benefit reductions needed to make sure Northwest avoids the plight of United and US Airways."

Those two majors, of course, went into Chapter 11 (from which US Airways has since emerged). He didn't mention American, which is on borrowed time.

Since September 11, 2001, Northwest has sent 15,000 workers, and 2000 managers, home. Meanwhile, it's lost over a billion and a half dollars.

The flight attendants' union sees the announcement as a "goes around, comes around" example. Union trustee Mollie Reileu was quoted last week as saying, "It's a start... I'm happy to see them commit to something."

Jim Atkinson, at the top of of the mechanics union, thinks there's a lot more that management could give up: "Richard Anderson claims we're all in this together, but he's cutting rank-and-file workers much more deeply than salaried employees in terms of pay percentages and numbers of layoffs." Since execs aren't "plug-and-play," as they see mechanics and many other workers, here's another thing: "...and he's not outsourcing 48 percent of their work, as he proposes for our work."

Besides, managers can vote themselves pay hikes and bonuses. Atkinson doesn't like what's been done in that area, either. He continued, "To show good faith, executives should return the bonuses and stock options they just awarded themselves. You cannot treat people like second-class citizens and expect them to continue delivering first-class service." [Anderson, for instance, got a quarter-million-dollar cash bonus, plus nearly $2 million in stock, in 2002, as the airline lost nearly $800 million --ed.]

Northwest wants its pilots to forego hundreds of millions of dollars' compensation in the next six or seven years; it's also asking the union to understand that the pilot payroll will drop by some 340 members. Flight attendants are looking at an airline proposal that cuts 9.8%; baggage handlers and ground workers are looking at RIFs on the order of another 1400+ members, plus a 2% compensation cut; mechanics are going to be down about 2000 members over the next seven years; those staying won't get as much as 17% as their extended pay scales would have promised. The unions start polling this week. Northwest has given itself a July 1 deadline to rearrange itself, to plan for profitability...

FMI: www.nwa.com