United Airlines makes tentative deal with flight attendants

Chicago-based United Continental Holdings Inc. reached a tentative deal to bring its 25,000 flight attendants under a single labor contract after five years of negotiations.

A divided workforce has dogged the carrier since United Airlines parent UAL Corp. merged with Continental Airlines in October 2010. The proposed labor pact would unite groups that currently work under three contracts for premerger work groups: a United camp, Continental workers and Continental Micronesia employees. As a result, flight attendants that came from United or Continental can't work together.

The agreement announced Friday, with the negotiating committee of the Association of Flight Attendants, is subject to approval by its leadership, the union said in a statement. The pact also would need to go to a vote of the union's full membership. Terms weren't disclosed.

"It's been a long journey and I'm grateful to our outstanding flight attendants," United Chief Executive Officer Oscar Munoz said in a release.

Management has clashed frequently with employees since the merger, and Munoz made smoothing relations with United's 84,000 workers a priority since taking office in September. United's pilots signed a two-year contract extension in January, and the carrier's dispatchers approved a labor deal in March. The carrier has yet to come to terms with its roughly 8,900 mechanics.

Munoz "immediately changed the tone" between the airline and its employees, Sara Nelson, president of the flight attendants' union, said in November.

Munoz must juggle higher pay rates approved under the new contracts with his plan to improve United's profit margin. He recently announced a plan to find $3.1 billion in savings and extra revenue by 2018.

Because United has struggled with labor relations since the merger, the advantages of reaching an accord with flight attendants will help offset any additional costs, said Joseph DeNardi, an analyst at Stifel Nicolaus & Co.