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Job and pay cuts loom for Delta employees in wake of bankruptcy

By JOHN MUNFORD
jmunford@TheCitizen.com

Figures on job cuts and pay cuts at Delta Air Lines are looming, with information becoming available as early as late this week, according to Delta spokesman Anthony Black.

Job and pay cuts for Delta won’t be good news for Fayette County, where an estimated 3,500 air line employees live, based on figures the company released last year to local officials. All employees will be impacted by proposed cuts to pay and benefits, Black said.

The company, now in Chapter 11 bankruptcy hearings, is seeking to restructure its current agreement with its 6,500-plus pilots, and that contract includes pay and benefit obligations in addition to various “work rules,” Black explained.

Although the air line’s new flight schedule hasn’t been announced yet, Black said Tuesday afternoon that he believes the Atlanta operation “will see limited impact.”

The company plans to offer several new flights out of Atlanta in the near future, including a non-stop from Atlanta to Maui, in the island state of Hawaii, according to the company’s Web site.

Despite the bankruptcy filing last week, the company is operating its business as usual and travelers shouldn’t see any difference in service when flying because Delta is honoring all its services and programs including frequent flyer miles, Black said.

The company’s plan to change its operations includes reducing the different aircraft in its fleet from 11 to seven to cut costs on maintenance. Also, the company will use smaller planes on some routes to limit the amount of empty seats and improve fuel efficiency.

Changes to the flight schedule are also being considered. Other flight schedule changes have already been made, including a reduction in flights to one of Delta’s other hub operations in Cincinnati, Ohio.

Skyrocketing fuel prices is one of the big factors behind Delta’s struggles, according to CEO Gerald Grinstein. Low-cost air carriers have also hurt Delta, forcing the company to be more competitive in its fare pricing, Grinstein has said.

The company presented its reorganization plan to creditors, who responded by extending another $2.05 billion in credit to the air line to help it get through the bankruptcy process, according to the company’s Web site.

Meanwhile, though, Delta retirees have been warned the company plans to skip its next payment to its pension fund to keep more cash available on hand. Although that $34 million payment may not be made, Delta retirees who qualify for the pension plan can still count on receiving their pension checks and the company does not plan to terminate pension payments to individual retirees, Black said.

The Air Line Pilots Association, Inc., which represents Delta pilots, has not made any detailed announcement of the pay and benefits cuts proposed to the union along with work rules changes. In a letter to union members, Chairman John Malone characterizes Delta’s latest proposal as asking for “deep concessions.”

“The coming months will undoubtedly be the most difficult period in our pilot group’s history,” Malone wrote in the letter. “It is important we focus on what we have always done best: providing Delta passengers with the safest, most reliable and professional service in our industry.”