Yesterday, Northwest Airlines reported a net income of 101 million dollars for July. The Minneapolis-St.Paul Business Journal notes that the carrier stated it “can and will” negotiate a labor agreement with its flight attendants, despite the fact that the concessions imposed on the flight attendants results in millions in savings management insisted are essential for reorganization.
The decision is very significant. As the Flight Attendants wait for a federal judge to decide whether a union can legally strike against an airline that has voided its contract with permission from a bankruptcy judge, other airlines are watching. A ruling in favor of the union would set a precedent for future cases. Logically, laws that prevent airlines personnel from striking unless all avenues of negotiation and mediation have been exhausted are moot if the airline can impose terms on the workers.
We acknowledge there are problems with the union system, and that union contracts lock employers and employees into a fairly inflexible system. But there is currently no better way to ensure that management will not take advantage of its workers. Often will unions hurt their members while working for the greatest good. For example, the IAM allowed Northwest to outsource ground workers. But even in the event of outsourcing, unions usually retain the right to negotiate the terms of the loss of their employees to arrange severance.
Either way, Northwest’s union insists there is no reason to believe that the company would negotiate fairly after they cut wages and benefits by 40 percent. The Long Island Press comments, in a somewhat amusing manner, that even though they suggested their excessed employees dumpster-dive and cutting salaries and benefits lleft and right, even Doug Steenland, CEO of Northwest, had to take a pay cut last year. His salary fell from $675,000 to $516,333 a year. With a paltry half a million dollars after taxes, he may have to start economizing as well.