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United Continental Holdings Inc., which has outsourced jobs at 39 U.S. airports since 2013 to vendors who perform the duties at lower cost, said Friday that it will halt that practice until at least the end of 2016.
About 2,300 jobs were eliminated through the outsourcing, although some furloughed employees who had adequate seniority were able to transfer to other locations.
An additional 16 airports that could have been targeted for job cuts are protected for now, United said. In addition, the company’s labor contract with check-in, baggage-handling and customer service workers represented by the International Association of Machinists currently exempts 23 busier airports and seven domestic hubs from job cuts.
In a message to airport employees Friday, Jon Roitman, senior vice president of airport operations, said the company is responding to employee concerns about job security. He pledged that no additional front-line positions would be outsourced until the Machinists union contracts open for renewal at the end of 2016.
The decision grew out of new attention to employee concerns introduced by Oscar Munoz, who took over as chief executive of United in early September with ideas about how to bolster employee morale and customer service by actively soliciting feedback. Mr. Munoz suffered a heart attack on Oct. 15 and is out on indefinite medical leave. United last week named Brett Hart, the company’s then-general counsel, as acting CEO.
The outsourcing began as part of a larger cost-cutting exercise at United, the nation’s No. 2 carrier by traffic. United in 2013 turned to vendors at six U.S. airports and three in Canada, affecting nearly 500 jobs. In 2014, it outsourced jobs at another 12 U.S. airports, affecting about 635 workers. Early this year, it said it could cut up to 2,000 jobs at 28 additional airports, but ended up eliminating 1,150 positions. Airports that have lost United staff jobs include Albuquerque, Anchorage, Buffalo, Jacksonville, Miami, Omaha and Oklahoma City. A spokeswoman declined to say whether any of those jobs would come back.
Under the new agreement, jobs will be preserved at least through next year at airports including ATL , IND, SAT, STL, TUL and RNO. The United spokeswoman said the company also will protect noncore jobs at hub airports, work such as deicing and ground-handling of commuter airline affiliates, for now.
Most of the nation’s largest airlines use contracted labor at a majority of their smaller airports because it is expensive to have their own employees handle few flights a day. AA and DAL both have subsidiaries that provide airport handling work to themselves and other carriers. United has no such unit. Sometimes the use of vendors risks hurting customer service.
The Machinists union estimates that with medical benefits, a 401(K) and travel benefits, its members might cost $35,000 a year more than an outsourced worker.
