Washington — Union officials warned Congress on Wednesday that a Delta Air Lines-Northwest Airlines merger would threaten workers' pensions – a scenario the airlines said was flat wrong.

Northwest's 12,500 employees represented by the International Association of Machinists and Aerospace Workers have a traditional pension plan that pays a monthly benefit. "The ill-advised Delta-Northwest merger will jeopardize everything they have worked for while destroying two once-great airlines and threatening the solvency of our nation's pension insurance agency," said Robert Roach, general vice president of the IAM.

Rick McKay/rmckay@ajc.com (ENLARGE)

Northwest employees from Minnesota attend the House hearing on the proposed merger between Delta and Northwest Airlines on Wednesday.

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He said that if the "combined giant airline fails and needs bankruptcy court protection, the frozen company-sponsored pension plans could be forced onto" the Pension Benefit Guaranty Corp., the government-created corporation that takes over pension plans for bankrupt companies.

"This would burden the PBGC with more than $15.6 billion in additional liabilities on top of its $13.1 billion deficit for fiscal year 2007," Roach said.

But Delta and Northwest representatives argued that the merger, if approved by the Justice Department, would create a more profitable airline.

Delta Vice President Robert Kight said the airlines' executives "know our employees and retirees may be worried about the changes ahead," but the merger will make them more secure by allowing the carriers to cut costs at a time when extremely high fuel prices are vaporizing profits.

"That stronger company will be better able to fund these pensions going forward," he said.

The House Education and Labor Committee held the hearing to consider the proposed merger's impact on workers and retirees. While the Justice Department alone has the power to block mergers on antitrust grounds, Congress writes the laws that protect pension benefits.

Lawmakers want to make sure that if the airline merger does get completed, retirees' "lives are not shattered," committee Chairman Robert Andrews, D-N.J., said. "There are profound pension issues involved here."

Except for its pilots, Delta's workforce is overwhelmingly nonunion. Nearly all eligible Northwest employees are unionized.

For airline workers, worries about pensions are not unfounded. Thomas Kochan, an MIT professor who studies airlines, told the committee that between 2001 and 2005, U.S. airlines eliminated 100,000 jobs. Amid a wave of bankruptcies, 16 pension plans covering 240,000 employees were terminated and turned over to PBGC.

Kochan said Delta-Northwest merger may well succeed, but it faces grave threats because of its "very different organizational cultures and labor relations traditions and systems."

Executives must find ways to bring together the different workforces to create a cooperative spirit, he said. Failure to do so "will likely produce a financial crisis for the merged company and put more jobs, pensions and services at risk," he said.

Patricia Friend, president of the Association of Flight Attendants, did not sound a hopeful note, saying "Delta management has already made it clear that they will do everything in their power to first make sure there is no union in place to protect the hard-earned benefits of the currently unionized Northwest flight attendants."