Northwest Airlines' Flight Attendants Ratify Collective Bargaining Agreement
Airline has reached ratified labor agreements with all unions as it prepares to exit bankruptcy.
EAGAN, Minn. -- (May 29, 2007) -- Northwest Airlines (NYSE: NWA WI) said today that its flight attendants, represented by the Association of Flight Attendants-CWA (AFA), ratified a new collective bargaining agreement.
Doug Steenland, Northwest Airlines president and chief executive officer, said, "As Northwest Airlines prepares to exit bankruptcy later this week, we are pleased that we have now reached ratified collective bargaining agreements with all of our unions. In particular, we are pleased that the flight attendants will be able to share in the success of the restructuring by receiving a claim in the Northwest bankruptcy case."
As part of the new agreement, flight attendants will receive a $182 million unsecured claim in the airline's bankruptcy. This claim will be sold for cash which will be distributed to flight attendants upon the company's emergence from Chapter 11. The agreement also includes additional contract modifications designed to improve the flight attendants' work environment.
"We deeply appreciate the tireless efforts of the National Mediation Board and its staff, who participated throughout these negotiations and aided the parties in reaching this agreement," Steenland continued.
"I realize that the past 20 months have been a difficult period for our employees and I want to thank them for their hard work and sacrifices that helped Northwest complete its restructuring. I am pleased that our employees are seeing the benefits of the restructuring already in the forms of unsecured claims and profit sharing. We hope to be able to share with our employees some $1.6 billion in unsecured claims and profit sharing payments through 2010."
"We are also pleased to be able to make distributions of Northwest common stock to holders of the company's Series C preferred stock," Steenland concluded. Series C stock was granted to Northwest employees as part of previous labor agreements.
Since beginning its restructuring process in September 2005, Northwest has remained focused on its goals to achieve a competitive cost structure, develop a more efficient business model and recapitalize its balance sheet. Earlier this month, the company received permission from the U.S. Bankruptcy Court for the Southern District of New York to exit bankruptcy. On May 9, Northwest announced that 98.4 percent of the dollar amount of claims that voted and 96.9 percent of the airline's creditors who voted, approved the Northwest Plan of Reorganization.
Northwest expects that it will emerge from Chapter 11 protection on May 31, once all closing conditions of the Plan have been met and the company's $750 million new equity rights offering has been funded.
Northwest Airlines is one of the world's largest airlines with hubs at Detroit, Minneapolis/St. Paul, Memphis, Tokyo and Amsterdam, and approximately 1,400 daily departures. Northwest is a member of SkyTeam, an airline alliance that offers customers one of the world's most extensive global networks. Northwest and its travel partners serve more than 900 cities in excess of 160 countries on six continents.