Union puts pressure on airline

THE flight attendants union at American Airlines is calling for a new vote on a concession package aimed at keeping the airline out of bankruptcy, saying its ratification a few days ago was tainted

The Association of Professional Flight Attendants, which represents about a quarter of American’s 100,000-strong workforce, did not say when it plans to hold the new poll except that it would be done expeditiously, according to a statement of the union’s President John Ward. American said on Friday it would drop the contested compensation plans for its top executives, a day after another union threatened not to sign its concession pact.

The deals from labour are aimed at saving the world’s largest carrier $1.8 billion a year in personnel costs.

American narrowly averted a massive bankruptcy filing when flight attendants joined two other unions in approving sweeping wage concessions needed to help turn the airline around.

AMR has recorded a $3.5bn loss in 2002 and narrowly avoided a Chapter 11 bankruptcy filing two weeks ago by securing the concession packages from its unions.

However, the airline’s three major unions were outraged at news of special pension funding for senior management, which emerged as rank-and-file workers agreed to deals that would slash pay for most major labour groups between 15% and 23%.

Mr Ward said the decision to drop the retention bonuses and an apology from AMR chief executive Don Carty about not properly informing unions of the executive retention plans were too little, too late: “No doubt, this cancellation is only a result of the fact that they were caught with their hands in the cookie jar.

“Based on these latest revelations and on a number of other factors, including management’s unwanted intrusion into the balloting process during the one-day extension, I sent Carty a second letter on Friday notifying him that APFA intends to reballot the membership on the Restructuring Participation Agreement,” he added.

American said it had voluntarily cancelled retention plans put in place more than a year ago to keep its key executives. The plans included bonuses for top executives who stayed with the company and funding for a special pension trust that would be paid to the airline’s top 45 executives, even if the carrier went bankrupt.

The Transport Workers Union, which represents 34,000 mechanics and ground workers at American, who make up about one-third of the airline’s total workforce, threatened not to sign the concession deals ratified by the labour group over the executive compensation issue.