Employee Groups Reject Northwest Pay-Cut Proposal

Law360, New York (March 9, 2006, 12:00 AM EST) -- Bankrupt Northwest Airlines Corp. hit a wall this week when two employee groups from the International Association of Machinists and Aerospace Workers rejected a new labor contract and authorized a strike.

Northwest had avoided a strike last week that would have grounded the carrier permanently when it reached pay-cut agreements with the unions for its flight attendants and pilots. But on Tuesday, it failed to make agreements with two of the four employee groups of the IAM.

The agreements, which are part of a larger effort...
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