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. Last Updated: 07/27/2016

UAL Corp. Faces Strike and Losses

CHICAGO / NEW YORK — UAL Corp. on Wednesday reported a $1.1 billion first-quarter net loss as ground workers for its United Airlines unit voted overwhelmingly to authorize a strike if a judge allowed the carrier to end their union's contract.

The vote from members of the International Association of Machinists and Aerospace Workers was another sign of labor unrest at United. The No. 2 U.S. airline on Tuesday won court approval to terminate pension plans for thousands of employees, a step it says was needed to cut costs and exit bankruptcy.

The IAM represents about 30,000 active and retired United employees who work in a wide range of areas, including ramp services, public contact, food service and security. The strike authorization was approved by 94 percent of its membership.

UAL, which filed for bankruptcy protection in December 2002, posted a first-quarter net loss of $1.1 billion, or $9.23 per share, compared with a loss of $459 million, or $4.17 per share, a year earlier.

The company recorded $768 million in reorganization charges in the quarter, including $433 million related to the federal Pension Benefit Guaranty Corp.'s motion to terminate UAL's pension plan for ground employees.

Still, United Chief Executive Glenn Tilton, who made more than $1.1 million in salary and bonus in 2004, said the airline was turning the corner.