Bankruptcy Judge Rules Airline To Reject Contract With
US Bankruptcy Court Judge Robert
Drain on Friday granted Frontier Airlines' motion to reject its
contracts with the International Brotherhood of Teamsters covering
mechanics and material specialists. The Teamsters, which represent
Frontier's mechanics, have been struggling to stop Denver-based
Frontier from permanently outsourcing all of its maintenance work
to El Salvador-based Aeroman.
According to the Teamsters, the union reached an earlier
agreement with Frontier regarding wage cuts... but negotiations
broke down after Frontier insisted on the unlimited right to
permanently outsource its heavy-check aircraft maintenance, hoping
to save cash as the airline fights through Chapter 11
The Teamsters refused to agree to Frontier's outsourcing
demand... and Frontier sought to reject the Teamster contracts.
The judge was then required by existing law to either reject the
parties' collective bargaining agreement allowing Frontier to make
changes as described in the decision or to deny Frontier's motion,
leaving the Teamster agreements in place. In the end he sided with
Despite his ruling, however, the judge made clear in his
decision that Frontier may outsource its aircraft maintenance only
as a last resort - after it has exhausted all other options to
perform the heavy check work at its Denver repair station.
"While the Teamsters do not agree with Judge Drain's ruling, the
ruling does at least anticipate that our mechanics will continue to
work on heavy maintenance in Denver," said Matthew Fazakas,
president of Teamsters Local 961, which represents Frontier's
mechanics in Denver.
"The company also has to continue the full staffing of the heavy
maintenance department," Fazakas said. "The economic concessions
must be modeled after the Teamster concession proposals, and there
must be a fair and transparent process to ensure the company works
in good faith in its hiring practices so that it uses its
outsourcing only as an absolute last resort."
Teamsters Airline Division Director David Bourne commended Judge
Drain for trying to get Frontier to negotiate in good faith.
"However, we are bitterly disappointed with his ruling and
anticipate appealing it," Bourne said. "The Teamsters are adamantly
opposed to all aircraft maintenance outsourcing because it is
unsafe, jeopardizes the flying public, costs more than in-house
maintenance, and, especially in today's economy, further
destabilizes the industry. This is no way to run a US airline."
Fazakas noted that Frontier is a low-cost carrier that already
has among the lowest labor costs in the industry. "Labor costs had
nothing to do with Frontier filing for bankruptcy protection,"
Fazakas said. "But once it filed for bankruptcy, Frontier's top
management and its high-priced lawyers decided to take advantage of
the built-in flaws of the bankruptcy laws to slash our members'
wages and to export 129 of our members' Denver-based jobs to El
"Why on earth does Congress allow laws to encourage the foreign
outsourcing of good, skilled, middle-class and critically important
jobs to foreign countries?" Fazakas said. "Frontier's use of the
bankruptcy laws to export our jobs and cut our surviving members'
wages is nothing short of a national scandal."
"The bankruptcy laws are skewed in favor or debtors and against
working people," Bourne added.