Mesaba Airlines pilots have voted to authorize a strike should union leaders call for a work stoppage at the regional airline, the seventh largest in the United States. Of the pilots who voted, 98 percent approved of the strike, according to the Mesaba unit of the Air Line Pilots Association (ALPA).

"Our goal is a fair and equitable contract, not a strike," said Capt. Tom Wychor, chairman of the Mesaba unit of ALPA. "The bargaining process needs a deadline so that we can achieve this goal."

The pilots agreed to concessions in a contract signed in 1996, which has saved the company more than $10 million in labor costs to date, the union said. The starting salaries at that time for Mesaba pilots, who operate both jet and turboprop airliners, was less than $17,000 per year, according to the union. Since then, the starting salary has grown to just $24,000. Also, Mesaba pilots who retire with the airline will do so with 25 percent less in retirement savings than pilots at other leading regional airlines, according to the union.

Contract negotiations between Mesaba and ALPA started in June 2001, and have been federally mediated since August 2002. The contract became amendable in June 2002, but does not expire because it falls under the Railway Labor Act. Among the open issues that remain are compensation, job security, work rules and retirement.

"Our pilots have sent a clear and bold message to management today," Wychor said Oct. 28. "If we can't come to terms with management on a new agreement that recognizes our contributions to this company, our pilots are prepared to strike."

Airline labor contracts are governed by the Railway Labor Act, which allows strikes only after an extensive process. ALPA has petitioned the National Mediation Board (NMB), the government agency that oversees airline and railroad labor disputes, for a release from mediation. This would occur only if the NMB determines that direct talks have reached an impasse. If the board makes such a determination, it would trigger a 30-day cooling off period, after which pilots could strike. The NMB has not yet made a formal response to the request.

Last year, Mesaba's parent company, MAIR Holdings [Nasdaq: MAIR], purchased Big Sky Airlines, a small regional carrier in Montana, and declined to negotiate with union officials about merging the two pilot groups. Mesaba pilots now fear that the smaller carrier may siphon off their current business, as well as future flying opportunities.

Mesaba operates as a Northwest Airlink partner for Minneapolis-based Northwest Airlines [Nasdaq: NWAC], the nation's fourth-largest major airline. Mesaba operates more than 800 daily departures from the mainline hubs of Minneapolis/St. Paul, Detroit, and Memphis to smaller "spoke" cities.

Northwest Airlines is considering ending its agreement with Mesaba to operate 36 Avro regional jets (CRAN, Oct. 13) and Mesaba said it would bid for any regional flying contract that is offered if that happens. Northwest acquired the Avro RJ-85 jets between 1996 and 2000 and allocated them to Mesaba.

If the Avro partnership is terminated, and Mesaba wins the contract for those routes, Mesaba would have to provide its own planes. The airline likely will have to compete with other regional carriers for the business.

Northwest chief executive Richard Anderson said that the carrier would seek bids from other airlines interested in flying passengers now served by the Mesaba Avros if Northwest decides to terminate its contract with Mesaba.

"Mesaba would be eligible, along with other airlines," Anderson told analysts and reporters during a conference call to discuss third-quarter earnings.

Northwest, which owns 28 percent of MAIR Holdings, has said it costs more to fly the RJ-85 than other planes that could replace them.

Northwest is scheduled to decide by Dec. 15 if it will continue to lease the Avro regional jets to Mesaba. If the lease is terminated, it would end on April 25, 2004.

Losing the lease would be a big blow to Mesaba. The company has estimated that the RJ-85s account for about 40 percent of Mesaba's more than $400 million in annual revenue.

>>Contact: John Mazor, ALPA, 703-481-4440; Dave Jackson, Mesaba, 612-713-6409.<<