Alaska Airlines Pact Ends Long Stalemate

By Cimini, Michael H.; Muhl, Charles J. | Monthly Labor Review, August 1995 | Go to article overview

Alaska Airlines Pact Ends Long Stalemate


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


After more than 3-1/2 years of contract talks, negotiators for Alaska Airlines and the International Association of Machinists (IAM) reached agreement on a 4-year contract covering 2,200 clerical, office, and passenger service workers employed in a variety of locations served by the airline, including Anchorage and Juneau, AK; Portland, OR; Los Angeles and San Francisco, CA; Phoenix, AZ; and Seattle, WA. The settlement came just 4 days after the National Mediation Board--the Federal Agency that administers labor law in the industry-declared a "30-day cooling-off" period following the parties, refusal to resolve their dispute through arbitration. Wage increases and benefits were the major sticking points in negotiations.

Alaska Airlines sought a 5-year wage freeze, elimination of the cost-of-living adjustment (COLA) provision, and increased employee copayments towards health insurance premiums, while the union opposed these proposals. The eventual settlement between the carrier and IAM allows Alaska airlines to hold operating costs in check and preserves employees, health care coverage.

The contract calls for seniority-based bonuses ranging between $750 and $1,500 in each of the first 3 contract years. In the fourth year, employees will receive a general wage increase of 3 percent. The settlement eliminates the parties, COLA clause.

Other changes increase the maximum annual accrual of compensatory time from 40 to 120 hours; permit training to be counted as time worked for overtime calculation; and continue the employee option to use a health maintenance organization or preferred-provider organization, while adding dental and vision coverage. The parties also agreed to an "early reopener" in May 1999, which requires them to seek mediatory assistance from the National Mediation Board if a settlement is not reached within 6 months.

Like many carriers in the industry, Alaska Airlines was in a financially precarious position in the late 1980's because of revenue decreases that had resulted from fare wars and cut-throat competition in its short-haul Northwest markets, and because of high operating costs, in part from labor contracts. …

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