CHICAGO, May 10 (UPI) -- A federal judge Tuesday approved United Airlines' plan to terminate its four defined-benefit employee pension plans, shifting obligations to the government.
U.S. Bankruptcy Judge Eugene Wedoff called the decision "the least bad of the available choices" that keeps the world's second largest airline flying and its employees paid.
Lawyers for United said the airline must shed $9.8 billion in pension liabilities to attract investment and exit bankruptcy this fall.
The Pension Benefit Guaranty Corp. agreed in April to pick up $6.4 billion of United's retirement liabilities in the largest pension default in U.S. history.
Workers would lose about 25 percent of their pensions when the plans move to the quasi-governmental agency that insures defined-benefit pension plans of companies.
Flight attendants, mechanics, baggage handlers and ground workers threatened strikes. United said a strike would be illegal and union members who participated would face discipline, including firing.
A hearing Wednesday may decide whether United can impose wage cuts on its mechanics and ground workers.
