Mechanics at bankrupt Northwest Airlines rejected a settlement proposal that would have ended a strike that began in August, the workers' union said Friday.

The Aircraft Mechanics Fraternal Association reported on its Web site http://www.amfa33.org that 56.59 percent of its voting members rejected the deal that would have granted them 26 weeks of unemployment benefits, four weeks of layoff pay, and payment of accrued vacation time.

The No. 4 U.S. carrier, which filed for bankruptcy in September, has continued flying since the strike began by using replacement labor. The striking workers walked off the job in August after failing to reach a labor contract with Northwest.

AMFA said this month that the settlement proposal was the "worst contract in the history of airline labor."

"Our striking members refused to bow down to Northwest's arrogant, self-enriching management and will continue the strike against this renegade, union-busting airline," said AMFA National Director O.V. Delle-Femine in a statement Friday.

AMFA represents about 4,400 mechanics and related employees at Northwest, but only 2,223 voted, the union said. Workers have been picketing at airports used by Northwest, although some have gotten new jobs or crossed the picket line.

"We are disappointed that members of AMFA have declined ratification of the company's latest contract proposal," Northwest said in a statement. "A ratified agreement would have ended the mechanics' strike and allowed both parties to move forward."

Northwest, along with other major U.S. airlines, has been battered by soaring fuel costs, weak revenue and low-fare competition. The airline is looking for total annual savings of $2.5 billion before it emerges from bankruptcy. The airline achieved $203 million of that amount by replacing its mechanics with cheaper labor.

Northwest has said its labor costs are the highest in the industry. A federal bankruptcy judge in November approved temporary pay cuts for about 28,000 workers, while the airline haggles with its pilots, flight attendants and ground workers over permanent savings.

If the unions fail to reach deals with the airline by Jan. 17, Northwest plans to renew an earlier request that the judge let the carrier void its collective bargaining deals and impose new contracts that yield the needed labor savings.

The Air Line Pilots Association (ALPA), which agreed to a temporary 24-percent wage cut, on Friday said it will conduct informational picketing on Jan. 4 to express displeasure with management's contract demands.

The union said Northwest's demands are excessive and that more than 1,000 Northwest pilots would lose their jobs as DC-9 aircraft are retired.

"Northwest pilots have already made huge sacrifices to help our company with its financial problems," said ALPA Chairman Mark McClain said. "We will not sacrifice pilot careers for a flying job at a start-up airline that may be sold off in the near future."

A spokesman for the International Association of Machinists (IAM), which represents 14,400 ground workers, said Thursday that negotiations are ongoing and that the union hopes to reach a consensual deal with Northwest.

"We hope to make any decision by the judge unnecessary," said IAM spokesman Joseph Tiberi.