Also, NWA Pilots Vote To Retain Chairman... For Now
Call it "Delta Envy."
That's the realization hitting pilots at Northwest Airlines -- just
as they're voting on a new pay deal that the bankrupt carrier says
it needs to emerge from Chapter 11 -- that they'll be making as
much as 10 percent less than their counterparts at Delta Air
Lines... even after pilots at that carrier have their pay cut,
too.
Before the two airlines entered bankruptcy last September, Delta
pilots made about 2 percent more than those at Northwest.
"Terms of Delta's tentative pilot agreement appear significantly
richer than those at Northwest," said analyst Mark Streeter.
"...Any case of 'Delta envy' on behalf of Northwest pilots would
appear justified."
The St. Paul (MN) Pioneer Press reports the Northwest deal
includes a 24 percent pay cut, in addition to a previous 15 percent
reduction. The union's executive council is split on approving the
deal (six for it, six against) which would set the pilots' annual
pay scale range from about $27,000 for new hires to $160,000 for
veteran pilots on the airline's biggest jets.
Industry insiders say the pilots' realization that the grass is
greener in Atlanta than in Eagan, MN may hamper Northwest's efforts
to move on from its heated talks with its pilots.
Despite the discrepancy, Streeter expects Northwest's pilots
will narrowly approve their pay deal -- especially when considering
the Northwest pilots' more favorable agreement over pensions.
"Our assumption is that Northwest pilots begrudgingly vote in
favor of their tentative agreement, though by a narrow margin,"
said Streeter, who writes for J.P. Morgan Securities.
Another sign that
Northwest's pilots might be looking to approve the deal came
Tuesday, as union leaders representing Northwest Airline pilots
have... for the moment... dropped their efforts to oust chairman
Mark McClain because of their angst over pay and benefit cuts.
McClain has led the NWA unit of the Airline Pilots Association
since 1999, and the vote to dump him was widely seen as an
indication of whether the pilots would go along with the
leadership-endorsed pay cut plan.
If Northwest's pilots don't go for the new agreement, Wall
Street figures Northwest will probably try to impose a new contract
on them... figuring if they don't like it, they can go the way of
unionized mechanics.