Business: Strike Settlement

Peace came to strike-bound Eastern Air Lines last week—at a high price. The line's 550 A.F.L-C.I.O. flight engineers, who went back to work after a 38-day strike, won a smashing victory. The company rescinded its earlier order that engineers must be pilot-trained to serve in jets, agreed instead to place a third pilot in its DC-8s, which will go into service next year. The line boosted the engineers' average annual pay by $1,200 to a top of $13,260, consented to an "agency shop" clause under which all engineers must pay union dues.

American Airlines moved closer to settling the 2½-week-old walkout of 1,500 pilots. American's gritty President C. R. Smith flew to Washington for a summit conference with the hard-bitten boss of the A.F.L.-C.I.O. Air Line Pilots Association, Clarence Sayen. Pressure was on both sides to settle before American starts to lay off most of its 20,500 nonstriking employees this week. Probable terms: three pilots in jets, higher pilot pay and improved benefits.

While the unions won a round against the companies, the cynically timed holiday strikes may well bring a tighter Government policy against such walkouts. At week's end Labor Secretary James P. Mitchell announced that he will soon convene a top-level labor-management conference to debate whether the 33-year-old Railway Labor Act, which tries to regulate airline disputes, needs revamping and toughening. Hearing the news, Eastern's Chairman Eddie Rickenbacker called for a law to require compulsory arbitration of disputes that cannot be settled by Government mediation.