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President Letter: Feb 20, 2004
MEC President Letter
Court Support of AFA Motion
February 20, 2004
Ladies and Gentlemen:
The integrity of our Contract and the tremendous commitment that Flight Attendants have made to the success of our Company through our Restructuring Agreement was reiterated in the bankruptcy court today. Our motion was heard by Judge Eugene Wedoff to appoint an examiner to investigate United for defrauding retirees out of Contractual medical benefits. AFA's arguments were supported by the International Association of Machinists and the Aircraft Mechanics Fraternal Association in court. Judge Wedoff ruled in support of our motion to appoint an examiner to investigate United.
The examiner's scope of the investigation, the findings of which will be reported to the court on March 19, 2004 , aims to determine if United decided to use the bankruptcy code to pursue changes to retiree medical benefits prior to July 1, 2003 . As you know, this date was significant because United established it as the retirement deadline by which an employee would have to retire to secure the previous Contractual medical benefits. Recognizing that the bankruptcy code provides an avenue through Section 1114 to seek changes to retiree medical benefits, United had not notified employees that it intended to pursue Section 1114 prior to that date, and in fact led employees to believe that the massive concessions totaling over 2 and a half billion dollars in annual cost savings would be sufficient to successfully restructure the Company. Robert Clayman of Guerrieri Edmond and Clayman, Council for AFA said, “This ruling means that the examiner will seek to determine who knew what, and when they knew it.”
Both active and retired United employees who have agreed to painful sacrifices to see United succeed deserve to know the extent of management's deception in baiting employees to retire with false promises of secure and reasonably priced medical benefits. Today's ruling should encourage United management to drop their ill-conceived plan, make good on their agreements with employees, and move forward with the business of the airline.
Judge Wedoff remarked that there is substantial urgency in resolving this issue because the ultimate success of the airline depends on management and employees effectively working together, and without cooperation, the reorganization won't succeed. To that end, he stated that the appointment of an examiner is “well worth the investment in arriving at a prompt conclusion” to the issue.
We could not agree more, and through our sacrifices and record-breaking contributions to United's operational results, Flight Attendants have continually affirmed our commitment to working collaboratively for our airline's success. Mismanagement tactics of breaking agreements and holding the employees in contempt epitomize the business missteps of the previous management who put United Airlines in jeopardy. Attempts by management to extract more concessions from Flight Attendants will not be condoned, and for the sake of our airline, we will expose these dishonest management schemes until they are stopped.
Continue to stay informed and involved as we defend our Contract and put a stop to concessions from Flight Attendants.
In Solidarity,
Greg Davidowitch, President
United Master Executive Council