Delta, Pilots Near Court Date

The airline will try on Wednesday to have the contract with its pilots canceled.
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This week has the potential to be a dramatic one for bankrupt carrier

Delta Air Lines

(DALRQ)

.

The Atlanta-based airline has a date in court on Wednesday regarding its request to cancel the contract it has with its pilots. The pilots, who are represented by the Air Line Pilots Association, have said they might strike if they lose in court, and they've scheduled a rally for Tuesday.

Delta filed for Chapter 11 on Sept. 14. In a filing with the

Securities and Exchange Commission

, Delta said it couldn't predict whether it would be able to prevent a strike.

The pilots helped Delta avoid bankruptcy late last year by agreeing to $1 billion worth of annual concessions. Now the nation's No. 3 carrier by passenger traffic wants another $325 million in annual savings from its roughly 6,000 pilots. The pilots' union offered $90.7 million in average annual concessions over four years.

"If the Bankruptcy Court permits us to reject the collective bargaining agreement," the filing said, "ALPA may seek to initiate a strike or other forms of work disruptions, which we believe would not be permitted under (the Railway Labor Act). However, we cannot predict the outcome of any effort to obtain court relief to prevent or stop a strike or other forms of work disruptions."

Delta also stated in the filing that "if we or our affiliates are unable to reach agreement with any of our unionized work groups on future negotiations regarding the terms of their collective bargaining agreements, or if additional segments of our workforce become unionized, we may be subject to work interruptions or stoppages."

Additionally, the airline said it couldn't predict if its defined benefit plans will continue once it emerges from bankruptcy. About 17% of Delta's workforce is unionized.

Last week, Delta posted a quarterly loss of $1.1 billion, compared with a $646 million loss in the prior year.