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United Forces Deal With PBGC To Terminate Viable Pension Plan

Date: April 22, 2005

Flight Attendants Outraged At Surprise Pension Move

CHICAGO - The Association of Flight Attendants-CWA (AFA) United Master Executive Council President Greg Davidowitch made the following statement today with regard to the announcement that, after cutting a deal set in motion by United, the Pension Benefit Guaranty Corporation (PBGC) will move to involuntarily terminate all of United's pension plans:

"United Airlines single-minded actions have forced the PBGC to pursue the termination of all employee pension plans. For months we have worked closely with the PBGC to avoid termination of the Flight Attendant pension plan. The fact that the PBGC would sell their claim for a few pieces of silver calls into question their role as protector of employee defined benefit pension plans.

"Abandoning promises to employees for retirement security after a lifetime of service is deplorable in itself, but when coupled with the fact that United executives are taking bonuses, have given themselves raises and refuse to meet the same standard of concessions they have demanded from their employees, the action is morally criminal.

"Make no mistake, there is one United employee whose pension won't suffer by today's actions. Glenn Tilton's protected $4.5 million pension trust remains intact and beyond question by the court, the government, but certainly not by the employees who have built United Airlines.

"We are outraged by this avoidable action and will oppose it forcefully in the courts and on the streets. By law, termination of each plan must be considered separately, on its own merits. The Flight Attendant Defined Benefit Pension Plan is the most affordable of United's pension plans and its viability would not prevent United from securing exit financing.

"United management has short-circuited the court process and is attempting to resolve the PBGC's financial claims at the expense of employee pensions. The money promised to the agency that brokered the termination deal would have been better spent on ensuring the viability of employee pensions. The financial resolution the PBCG seeks today is short-sighted; the precedent it sets for all of America's defined benefit pension plans is devastating. This action may have set in motion the total collapse of our country's pension guarantee system - placing the burden of retirement security in the laps of the American taxpayer."

More than 46,000 Flight Attendants, including the 21,000 Flight Attendants at United, join together to form AFA, the world's largest Flight Attendant union. AFA is part of the 700,000 member strong Communications Workers of America, AFL-CIO. Visit us at www.unitedafa.org.

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