Wed, Sep 29, 2004
More Cost-Cutting Measures
Delta Airline employees will get an
unhappy surprise in their checks at the first of the year: ten
percent less money than they're getting today.
In its struggle to save itself from bankruptcy, Delta has
already promised to cut 7,000 jobs and is negotiating with its
pilots union for concessions. Now, the airline says it will cut
both pay and health benefits to the 49,000 workers and managers
still on the job.
"We have a small window of opportunity available to us to avoid
Chapter 11 that some other carriers do not have," Chief Executive
Gerald Grinstein told workers in a statement today. He was quoted
by Bloomberg. Grinstein also said he won't get a paycheck for the
rest of this year.
There was one bright note for Delta.
More than 90-percent of its ALPA pilots voted to allow some
retirees return to the cockpit. That vastly reduces the possibility
that the airline will face, among its other troubles, a shortage of
flight crew members. An analyst quoted by Bloomberg said that was a
good move for all concerned -- but a step far short of saving the
financially strapped airline. In return, the airline agreed not to
axe the pilot pension program -- even if Delta does fall into
bankruptcy.
But even these measures, along with a cut in vacation benefits
and retiree health payouts, aren't enough, said Grinstein. "The
industry environment and our company's worsening financial
situation have deepened the gap between where we are and where we
must be to survive," he told his workers, according to the
Times.
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