United Airlines

Paper Summary:

This paper discusses the ethical issues involved in the United Airlines case by which it has divested itself of its pension plans, as the leadership sought concessions from the unions in order to cut labor costs and so allow the airline to continue operating. It looks at how from the airline point of view, the issue was framed as saving jobs or closing the airline. For employees, though, the issue involved a breach of trust as the airline eliminated the pension system it had maintained.

From the Paper:

"The recent restructuring of employment agreements by United Airlines raises a number of ethical questions as well as business issues and the possibility of future regulatory issues. United Airlines reached the point of bankruptcy, or at least claimed that it was facing bankruptcy, and to forestall this conclusion of the company, the leadership sought concessions from the unions in order to cut labor costs and so allow the airline to continue operating. From the airline point of view, the issue was framed as saving jobs or closing the airline. For employees, though, the issue involved a breach of trust as the airline eliminated the pension system it had maintained. The issue is not solved by the fact that a federal court allowed this change, and indeed this fact only creates clear in others about what the government will allow an industry to do with funds entrusted to company pension plans across the country."

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