Northwest strike seen as a watershed

Martin Wolk Chief economics correspondent • Profile • E-mail

It remains to be seen whether Northwest Airlines can operate indefinitely without its unionized mechanics, but the strike against the nation’s No. 4 carrier is being seen as a watershed event for labor relations in the embattled airline industry.

The 5-day-old strike by more than 4,000 members of the Aircraft Mechanics Fraternal Association is unique in some ways but also points to new battles over pensions and outsourcing facing airlines and their unions as they struggle to adapt to a rapidly changing marketplace.

“Other airlines are definitely looking at this,” said Gary Chaison, a professor of industrial relations at Clark University in Worcester, Mass. “They will probably make demands and feel emboldened by what happened at Northwest. This is a major shift in bargaining power that is being demonstrated.”

He said Northwest executives aggressively pursued a contract that they knew was unacceptable to the mechanics union because “they were not fearful of a strike,” having prepared a costly and detailed plan to continue operating through a work stoppage.

“If one side doesn’t fear a strike anymore than there is a greater chance of there being a strike,” he said.

Airline strikes are relatively rare largely because the heavily unionized industry is regulated by the federal Railway Labor Act, which allows the president to step in and prevent walkouts, as President Bush did in March 2001 when the same union threatened to strike Northwest.

But this time around neither side asked the White House to intervene and Bush stayed on the sidelines. That triggered a strike that has drawn comparisons to the epic 1989 showdown between mechanics and Eastern Airlines, which ultimately went out of business.

“The very fact that Northwest is even operating is historic,” said Terry Trippler, who follows the industry for 1-800-CheapSeats, a travel agency. “Companies dream of that, and Northwest did it.”

The Northwest strike could usher in a new period of bare-knuckle bargaining, but airline unions have been giving up ground in their contract negotiations for years if not decades.

Experts in labor relations say airline unions have been granting concessions since at least the early 1980s, but past rounds of concessionary bargaining generally were tied to economic recessions. This time around, union givebacks have accelerated even as other sectors of the economy have bounced back convincingly from the 2001 recession.

Two of the nation’s biggest carriers — United and U.S. Airways — are operating under bankruptcy protection, and unions there have been forced to accept billions of dollars in concessions as well as a certain reduction in pension benefits. Unions at American Airlines have accepted $1.6 billion in concessions, while ailing Delta Air Lines has notified its pilots union that cash levels have fallen below a point that could trigger new concession talks.

“What is new about the current period is that in the past it was the weaker carriers that tended to press the hardest. Today it is far more generalized, and there doesn’t appear to be any end in sight,” said Harley Shaiken, a labor expert and professor at the University of California in Berkeley.

The auto industry went through a similar period of widespread concessionary bargaining the early 1980s, but there was far more collaboration and less animosity than what is being seen in the current showdown between labor and the airline industry.

“It was very painful, but there was no talk of replacement workers or breaking the unions. And what they gave up was relatively modest compared to what is being talked about now in the airline industry,” Shaiken said. “What we are looking at now is a very profound restructuring of wages and rules in the industry. And there is little expectation that any of this will be regained.”

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