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Mon, May 03, 2010

Reaction Begins To Proposed UAL-Continental Merger

Pilots, Machinists, Weigh In On The Plan

Pilots and machinists working for United and Continental Airlines have both weighed in on the proposed merger of the two companies announced on Sunday.  The pilots are cautiously optimistic, while the machinists warn of potential obstacles to the marriage.

In a statement released jointly on Monday by Wendy Morse, Chairman, United Master Executive Council, and Captain Jay Pierce, Chairman, Continental Master Executive Council Air Line Pilots Association, International, the two pilots unions said integrations of two airlines such as was announced by the two legacy carriers Sunday is always challenging. "The support of the pilots is pivotal in determining whether a merger is successful or not, as will be the case with this merger of Continental and United," they said. "While there is potential for this transaction to create a truly great airline, there are also risks involved. The entity being created must be stronger and more viable than the independent entities that are being merged. The futures of our pilots must also be more secure going forward -- both in our careers and in retirement. We have sacrificed too much through years of concessions, furloughs, pension freezes and terminations to accept unwarranted risk, and any risk requires reward."

"The pilots who fly for Continental and United are prepared to stand shoulder to shoulder to support the creation of a viable, profitable merged company," the statement continued. "The importance of a fair and equitable seniority integration between the two pilot groups and a businesslike commitment to achieving commensurate value for pilots through the prompt negotiation, among other things, of a new joint collective bargaining agreement is recognized by all parties as central to a successful airline merger. We are also prepared to stand shoulder to shoulder in opposition of this transaction should these ideals and concepts not immediately be fostered by the new management team. Both the United and Continental pilot groups understand what can be achieved by working together; and, in concert with the new management team, under these conditions welcome the opportunities and expected rewards of building a winning combination."

International Association of Machinists and Aerospace Workers' (IAM) General Vice President Robert Roach, Jr. offered a similar, if somewhat less supportive, assessment in a statement released Monday. "A Continental/United combination must have what many past mergers failed to achieve: broad employee support," he said. "The Machinists will work closely with members of Congress and the Departments of Transportation and Justice to ensure that if a merger is approved, it will not be at the expense of workers at either carrier.

"The IAM's Transportation Merger Team has been evaluating a possible United-Continental pairing since United Airlines exited bankruptcy in 2006. Our concerns include the impact of such a merger on the pensions, benefits, seniority and job security of employees at both carriers. We are concerned about the survivability of the combined airline and the merger's effects on passengers and the cities the airlines serve. As this process moves forward, these issues must be addressed to our members' satisfaction," Roach continued.

The machinists union president said that, with more than 26,000 Machinists Union members at both carriers, one way to avoid some of the mistakes of past airline mergers is to include the IAM very early in the process.

The IAM represents 16,000 United Airlines Ramp, Stores, Public Contact, Fleet Technical Instructor, Maintenance Instructor, Security Guard and Food Service employees, and another 76 employees at United's frequent-flyer program, Mileage Plus, Inc. The IAM also represents Continental Airlines' 9,500 Flight Attendants, 250 Flight Attendants at Continental's wholly-owned subsidiary Continental Micronesia and 1,200 Flight Attendants at Continental and United regional partner ExpressJet Airlines.

FMI: www.alpa,org, www.goiam.org

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