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Behind the Worker Revolt at American Airlines

Behind the Worker Revolt at American Airlines

American Airlines employees on Friday staged what could be called a workers’ revolt, announcing proposed labor contracts with US Airways Group (LCC), the airline that would like to buy American out of bankruptcy.

Three unions representing a total of 48,000 pilots, flight attendants, and mechanics at American parent AMR “have agreed to terms that would govern collective bargaining agreements for their members at the merged airline,” US Airways Chief Executive Officer Doug Parker said in a letter to his employees. (A US Airways spokeswoman said Parker was not available Friday for comment.)

US Airways has been huddling with bankers for months, mapping out how to acquire its larger Texas-based rival, enhancing its own challenged route network, and furthering industry consolidation in one stroke. In essence, Parker’s team has offered American’s work force a sweeter deal than anything they will see in the bankruptcy reorganization. American had previously announced 13,000 job cuts and wants other changes that would depress pay; on April 18 it said it will dismiss1,200 more non-union workers. In his letter, Parker said the merged airline would need to lay off only 6,800 unionized workers.

Beyond the pressure the unions have exerted on AMR’s management, the US Airways talks serve as a forceful notice that American employees are fed up and actively seeking new management. Years of concessions, negotiations, and public sniping—all while the airline lost money and shrunk its network—have boiled over into full rebellion, with American workers seeking to replace their bosses.

The president of American’s pilots’ union, the Allied Pilots Association, alluded to this in his Friday letter to pilots. “Working with US Airways, APA was able to achieve in just over a week far more than we had been able to achieve in more than five years of trying to bargain with AMR management,” APA President Dave Bates wrote. “Our interaction with US Airways was in stark contrast to what we have been experiencing with AMR. We dealt directly with the people whose jobs are to run an airline.” In a video to her members, Laura Glading, president of the Association of Professional Flight Attendants (APFA) said the agreement “puts flight attendants in a far better position than any proposal American Airlines management has ever made.”

In a statement, American said its effort to reject union contracts begins in court on April 23 and that it considers the timing of the unions’ statements “no coincidence.” The company noted that the court has given it exclusivity until Sept. 28 to pursue its own reorganization independently. “These statements do not in any way alter the company’s commitment to pursue our business plan or our focus on moving steadily through the court supervised restructuring process to create a profitable, growing industry leader,” American said.

 Bloomberg Businessweek, Justin Bachman

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