Some NWA ground workers vote down pay cut

Northwest Airlines will be forced to return to the bargaining table with the ground workers union after baggage handlers rejected a contract offer Tuesday that would have cut their pay 11.5 percent and outsourced some of their work.

Customer service agents, who are represented by the same union, approved a similar contract proposal Tuesday. The union called the verdict by the rank and file "a split decision."

Northwest has been seeking $190 million in annual cuts from the International Association of Machinists and Aerospace Workers (IAM), which represents 13,369 employees.

Each employee group in the union has a separate "book" under the contract, so one group can accept the agreement while another rejects it. A bloc of voters that includes customer service agents, clerical workers and reservation agents approved its agreement with 67 percent in favor.

A second group includes stock clerks and equipment employees.

The latter handle bags and de-ice airplanes. The group rejected the deal with 60 percent voting against it.

"I don't think anybody liked the whole package," said Bobby DePace, president of IAM District 143. He added that customer service agents decided "they would rather have this contract than to deal with what might happen in bankruptcy court."

Northwest said Tuesday that it will ask U.S. Bankruptcy Judge Allan Gropper to conduct a hearing and decide whether to reject the existing contract for the IAM equipment service employees.

The process that the union will face in bankruptcy court is identical to the one just completed by the pilots and flight attendants unions. In court, the union attorneys questioned Northwest's business assumptions and the kinds of sacrifices the company wanted from the unions. Simultaneously, the two sides continued negotiations.

DePace said Tuesday that he will meet with IAM negotiators today to identify the most-critical issues that must be addressed to get a deal acceptable to equipment service employees.

A 42-member group of flight-simulator technicians also rejected its deal. An 18-member IAM group of plant security employees approved its agreement.

In January, IAM negotiators made no recommendation on Northwest's offer. "Our negotiators decided we would do the best we could and bring [an offer] out to the membership," DePace said. "The membership has spoken. That was a big part of what we needed to do to let our membership send a message to Northwest." About 75 percent of union members voted.

About 1,600 to 2,800 IAM members could lose their jobs under Northwest's offer, which included up to 20 weeks of severance pay. The proposal would have allowed Northwest to hire outside contractors in many small stations and also would have converted some full-time positions to part-time jobs.

Under bankruptcy law, Northwest management is required to bargain in good faith while the contract hearing process is underway. After the parties restart negotiations, DePace said, it will become evident "how sincere they are about getting a deal done."

Ken Hooker, president of Bloomington-based IAM Local 1833, said he was not surprised that equipment service employees voted no.

"This was a permanent giveback," Hooker said. People were upset that Northwest wanted them to lock in lower wages in a five-year contract. Some employees "had a hard time looking at 1989 wages in 2015."

The union started negotiating this contract proposal in 2002. It typically takes multiple years to negotiate the next contract. The offer that was voted down would have run through 2011 or 2012, depending upon when Northwest exits from bankruptcy protection.

Hooker said many workers told him that they didn't believe Northwest was offering them adequate rewards for making sacrifices.

In August 2003, Northwest refused to buy back stock that many workers were still holding from 1993, when they got the stock in exchange for concessions that they made to help Northwest avoid bankruptcy.

John Budd, a human resources professor at the University of Minnesota, said Northwest finds itself in a tough spot.

"The strategy is to rearrange the [IAM] package to achieve the cost-savings target while making the elements of the package more palatable to those that voted no," Budd said.

However, he said, that is easier said than done.

"If the airline significantly backs away from its [IAM] targets, then this would increase the likelihood that the pilots and flight attendants would reject their agreements by thinking that they can get more by turning down their contracts."

In Tuesday's IAM results, DePace said, members "overwhelmingly" gave the leadership the authorization to call a strike if Northwest imposes a contract on the union.

Liz Fedor • 612-673-7709