Home 
Health Care Matters MEC Communications MEC
President Letter: Mar 18, 2004
MEC President Letter
Report Reveals Bad Faith Bargaining
March 18 , 2004
Ladies and Gentlemen:
The examiner filed his report with the bankruptcy court this evening. While the report indicates that United did not make its definitive decision to pursue Section 1114 prior to December of 2003 or January of 2004, it also reveals that Chief Financial Officer and Chief Restructuring Officer Jake Brace knew that the company would likely seek changes while failing to disclose that information to AFA or the employees. This information would have greatly impacted the process by which massive concessions were negotiated, the Members’ decision to ratify the Contract, and it would have made a substantial difference for thousands of employees who decided to retire.
The examiner will present his report before the court, tomorrow, March 19th in the Chicago bankruptcy court.
While the examiner did not find the company intentionally committed fraud, management is accountable for the additional findings reported in the examiner’s 40 page report.
Section 1114 requires that changes to retiree medical must be necessary as well as fair and equitable. The findings of the report reveal that United’s proposal is based on bad faith bargaining which strikes at the heart of fair and equitable. United’s recent 10k filing reports about $280 million in savings relating to the Medicare Act, which further affirms that changing retiree medical benefits is NOT necessary.
The examiner’s full report may be found on our website, www.unitedafa.org by tomorrow morning. We will keep you advised as we continue to work to preserve retiree medical benefits, and put a stop to concessions from employees.
In Solidarity,
Greg Davidowitch, President
United Master Executive Council