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Oct 30, 2008 6:39 pm US/Central
Labor Talks At Southwest Airlines Hit Snag
DALLAS (AP) ―
Labor talks between Southwest Airlines Co. and its ground workers have stalled over wages, and the union and company plan to seek federal mediation on Friday.
The move is a setback for Southwest, which has long enjoyed relatively good labor relations compared with other airlines.
But it is also a sign of the economic turmoil in the airline industry that is hurting Southwest, financially the strongest U.S. carrier. The Dallas-based airline is struggling with high fuel prices and signs of a slowdown in air travel.
Despite the breakdown, the union would have to meet several conditions of federal law that could take months before workers could go on strike. Union officials did not raise the prospect of a strike on Thursday.
The Transport Workers Union is seeking cost-of-living wage increases on behalf of 7,200 ground workers, including ramp and freight agents. Union officials said they aren't interested in stock options, which they got in a 2-year contract extension in 2006.
Workers can exercise those options for $15.73 per share, but Southwest's shares closed Thursday at $11.24, up 40 cents, or 3.7 percent.
At top scale, ground workers at Southwest make more than counterparts at other U.S. airlines, but employees lower in seniority are sometimes paid less than at other carriers, according to the union.
"Wages have not kept pace with the rising cost of living, and some of our members have not had a raise since 2005," said Charles Cerf, president of union Local 555.
Cerf said Southwest's employees are the most productive in the industry, with fewer workers per aircraft, and deserve to keep pace with inflation.
Southwest did not immediately respond to requests for comment. The airline is also in separate contract talks with pilots.
The Transport Workers Union had planned to ask the National Mediation Board to declare negotiations at an impasse, and the company agreed to go along with the request this week, according to a union official.
Negotiations began in January.
(© 2009 The Associated Press. All Rights Reserved. This material may not be published, broadcast, rewritten, or redistributed.)
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