Exhibit 99.1
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TENTATIVE UNITED-ALPA 2000 AGREEMENT - SUMMARY
The tentative agreement on a new contract for United pilots was
announced by United Airlines and the Air Line Pilots Association
(ALPA) on Aug. 26, 2000. ALPA's UAL Master Executive Committee
endorsed the agreement on Sept. 9, and the Labor Committee of the
UAL board of directors endorsed it on Sept. 13. The tentative
agreement is currently under review by the pilots. If ratified,
the contract will be retroactive to April 12, 2000, the amendable
date of the pilots' contract, except as otherwise provided.
DURATION
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- The amendable date of the contract is Sept. 1, 2004.
SCOPE
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- The tentative contract allows United Express carriers to
increase the number of small jets (SJ) beyond the current 65
limit and includes:
- one-for-one replacement of up to 150 turboprops with SJs.
- more SJs if United's fleet grows above 451 narrowbody and
141 widebody fleet size.
- The tentative contract allows United to acquire up to 20
percent voting equity and 20 percent non-voting equity of a
Star Alliance member, or of a carrier that commits to
Star membership.
- United may share profits and losses of revenue with foreign
carriers with whom United has antitrust immunity, provided
United gets its fair share of the flying.
- The tentative contract establishes that United will not fly
or train pilots during a lawful strike by United pilots, and the
no-strike clause in the former agreement has been eliminated.
- The number of guaranteed active pilot positions, total
system and international block hours, mainline jet fleet and
furlough protection has been updated.
- The definition of successor (purchaser of the company) has
been modified to include a purchaser of 50 percent or more of the
equity or value of the assets of United or its parent (1).
WAGES
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- The initial weighted average increase in wages is 23.8
percent over snapback (2).
- The increase in first-year wages ranges between 21.5 percent
and 22.5 percent for pilots of the narrowbody fleets.
- The B777 and B747-400 fleet pilots both get a 28.7 percent
increase over snapback.
- The annual increases will begin on May 1, 2001, with a 4.5
percent increase for all fleets with the exception of the
747-400, which will be 5.62 percent. The additional annual
increases will occur on May 1, 2002, May 1, 2003 and
May 1, 2004, with the same increases.
BENEFITS
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- The defined benefit plan-related costs have increased from
benefit improvements and the effect of higher wages.
- The multiplier for determining pension benefit has increased
from 1.41 percent to 1.50 percent per year of service.
- The early-retirement reductions have been reduced to 3
percent per year (from 6 percent) prior to age 60.
- The defined contribution benefit costs have increased
due to benefit improvements and the effect of higher
wages.
- The contribution percentage has increased from 9 percent to
11 percent of wages.
- Medical and dental benefit costs have been increased modestly
due to benefit plan improvements.
- For active employees, a short-term disability benefit is
paid at 55 percent of pay for three months.
WORK RULES
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- Premiums have been established for nighttime flying and
modified for international flying.
- Domestic and international hourly expense per diem has been
increased to $2.00 and $2.50, respectively, effective April
12, 2000, and will increase $0.10 each May 1 (starting in
2001).
- The agreement establishes "flex months," which permit
scheduling of pilots by fleet up to 83 hours in as many as
four months annually.
- The minimum-monthly pay guarantee has been reduced to 75 hours
from 78 hours, or 77 hours in flex months.
- The agreement provides that pilots will be paid for the
greater of scheduled flight time, actual flight time or credit
time produced from a pilot's actual flight operation.
Additionally, reserve pilots will be paid credit time in the
same manner as line-holder pilots (pilots who have firm flight
schedules for the month).
- Domestic scheduling has been improved to the mutual benefit
of the company and the pilots as follows:
- The level of pilot and aircraft co-pairing has been
increased.
- The length of ground time, duty period and time away from
home has been limited.
- The two-for-one rest provision, for duty periods greater
than eight hours within a 24 hour period, has been eliminated to
bring United in line with the rest of the industry.
- Systemwide reserve coverage requirements have been increased
in accordance with the current practice:
Captain 17 percent
First Officer 15 percent
Shuttle 12 percent
Notes:
(1) parent - The parent of United Airlines is UAL Corporation.
(2) snapback - refers to the return of wages and the directed
account plan contribution to their levels before the onset of
United's Employee Stock Ownership Plan (ESOP), which began on
July 12, 1994.
