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United Airlines Flight Attendants State Commitment to Successful Restructuring of Airline

Date: August 23, 2002

CHICAGO – The Association of Flight Attendants, AFL-CIO, United Airlines Master Executive Council met with their legal and financial advisors on Thurs., Aug. 22 and passed a resolution strongly stating that talks concerning Flight Attendant participation in a much needed restructuring of the airline hinge on United providing the Flight Attendants with a “comprehensive vision for a full recovery of the airline through operational changes that increase United’s ability to generate revenue to prevent a bankruptcy filing, and not just a demand for employee concessions.”

The resolution, which passed unanimously, directs United MEC President Greg Davidowitch to once again “request a viable business plan from United management.” Davidowitch is scheduled to continue meeting with the airline’s executives on Mon., Aug. 26. Full text of the resolution can be viewed at www.unitedafa.org.

“United’s dire financial condition was brought on by management’s strategic short-comings,” said Davidowitch. “Continuing to push Flight Attendants to change our contract is a waste of time as long as management has failed to address the airline’s most fundamental failure – its inability to generate revenue in today’s industry.”

The United AFA MEC again questioned management’s demand for changes to the current Flight Attendant labor contract. Demands for labor concessions assume that labor costs are United’s problem. However, the current Flight Attendant contract, which runs to March 2006, is unique in the industry. It measures each year and contractually fixes United’s Flight Attendant costs at the AVERAGE of United’s competitors through an arbitration process. The most recent arbitration ruled that United enjoyed a $48 million advantage in its Flight Attendant costs over the AVERAGE of its competitors in 2001.

The cost-competitive nature of the Flight Attendant agreement is an asset to the airline that should help United’s application to the Air Transportation Stabilization Board for a loan guarantee backed by the federal government.

“United’s Flight Attendant costs represent approximately only seven cents of every dollar of revenue,” Davidowitch said. “Unless management makes significant improvements in our airline’s operations, Flight Attendants could work for free and we could not save this airline.”

More than 50,000 Flight Attendants, including the 26,000 Flight Attendants at United, join together to form AFA, the world’s largest Flight Attendant union. Visit us at www.unitedafa.org.

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