UPS pilots agree to cost cutting

UPS’s pilots union has agreed to US$131 million in concessions over the next three years to avoid 300 layoffs.

Using a variety of voluntary steps, the Independent Pilots Association’s (IPA) has identified savings of almost $90 million dollars pending final calculations. Although the full three-year goal was not reached by the original 2 June deadline, UPS and the union have agreed there will be no furloughs until 1 April 2010. In the mean time, the IPA will continue to try and produce additional savings.

The savings identified by the IPA have been produced through voluntary programs such as pilots taking short- and long-term leaves of absence; military leaves; job sharing; reductions in flight pay guarantees; early retirement, and sick bank contributions.

Bob Lekites, UPS Airlines president, said: “[The agreement] shows how a company and its union can work together to achieve a mutually beneficial outcome. We applaud our pilots for making the voluntary commitments necessary to help us protect our business and UPS jobs in this uncertain global economy and we thank the IPA for their leadership in this process.”

Company spokesman Michael Mangeot said: “Since we are balancing our flight network with the reduced demands of our customers, we are doing less flying,” he said. “For example, two weeks ago we retired our DC-8 fleet. Consequently, we need fewer crew members. Our analysis by flight operations experts, engineers and finance professionals shows that, given current economic conditions, we have approximately 300 more pilots than we need.”

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