TWA's Restructuring Continues

By Cimini, Michael H.; Muhl, Charles J. | Monthly Labor Review, December 1994 | Go to article overview

TWA's Restructuring Continues


Cimini, Michael H., Muhl, Charles J., Monthly Labor Review


As part of an ongoing effort to "re-engineer" its operations, Trans World Airlines (TWA) reached a 3-year collective bargaining agreement with the International Association of Machinists (IAM), its largest union, on work-rule and productivity changes that are expected to save the carrier approximately $90 million annually. The Machinists represent about 13,800 mechanics, guards, and dining and passenger service workers at TWA facilities in New York, NY; Los Angeles, CA; and St. Louis and Kansas City, MO. The airline currently has a work force of 24,500.

Both sides agreed that the settlement was a critical step towards restoring the financially troubled airline's fortunes. IAM President William O'Driscoll said, "These agreements provide for the necessary productivity changes to ensure the long-term survival of TWA." The airline's Chief Executive Officer, Jeffrey Erikson, stated that the contract "demonstrates that cooperation and open-mindedness in an atmosphere of mutual trust will produce the foundations of our future."

The work-rule changes provide the airline with greater flexibility when assigning projects and permit increased use of part-time workers and subcontractors. TWA now can contract out dining service at John F. Kennedy Airport (JFK) in New York and Los Angeles International Airport (LAX), a move that will result in the loss of 400 bargaining unit jobs. The carrier can hire more part-time workers--up to 20 percent of baggage handlers and ramp service workers (previously, 10 percent) and 50 percent of guards at JFK, LAX, and Kansas City (previously, all were full-time workers). The airline may also "crossutilize" mechanics--that is, assign an employee who specializes in one mechanical area to work on projects in other specializations. …

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