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Monday, May 29, 2006

Judge Maintains Mesaba Labor Contracts

Mesaba's labor contracts remain in effect owing to a ruling by U.S. Bankruptcy Court Judge Gregory Kishel denying Mesaba's petition to abrogate its collective bargaining agreements with its mechanics, flight attendants and pilots. The judge cited the airline's failure to provide a working financial model to the unions and its modeling of workforce attrition. Mesaba, a subsidiary of MAIR Holdgings (MAIR), said it is in the process of providing that data.

"We believe Mesaba has a strong case and it's clearly apparent from Judge Kishel's well-reasoned and thoughtful option that Mesaba is in dire financial straits and needs cost restructuring," said Mesaba in reaction to the May 18 ruling. "The court found reasonable and necessary Mesaba's core business assumptions including the 19.4 percent labor cost concessions over six years." Northwest Airlink can re-file its motion for an expedited ruling, if the "unions do not recognize the dire financial condition of the company," it said, adding it either has or will shortly address the judge's concerns. Mesaba was meeting with pilots in the past few weeks but the flight attendants and mechanics were awaiting the outcome of the pilot negotiations and the court ruling before returning to bargaining. (RAN, May 15) The airline said it would continue to meet with its unions.