Bankruptcy Reader

Northwest Airlines recently asked the court overseeing its bankruptcy reorganization to block a possible strike by its flight attendants. Airline authorities feared that the Association of Flight Attendants (AFA) might call for a strike or job action against it. Problems arose when the airline terminated its contract with the AFA and imposed new terms. In response, the union threatened to strike as early as August 15.

Northwest, which filed for bankruptcy protection last September, stated that a strike by the AFA could threaten the continued viability of Northwest’s reorganization. This would also cause disruption to Northwest’s customers, the airline claimed. Problems between Northwest and the union began around the time the airline filed for bankruptcy on the grounds that it needed $1.4 billion in total labor savings. Nytimes.com reports:

Judge Gropper said in June that Northwest could void the contract if the two sides failed to reach a deal the members would ratify. The flight attendants’ vote on Monday rejecting the tentative deal was the second defeat of an agreement that union leaders had negotiated.

Read more: U.S. Bankruptcy Court Asked to Block a Northwest Strike