AA employees expect tough time in bankruptcy

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by BRAD WATSON

WFAA

Posted on November 29, 2011 at 7:00 PM

Updated Tuesday, Nov 29 at 7:23 PM

D/FW AIRPORT — There are some 80,000 American Airlines employees worldwide, with more than 24,000 here in North Texas.

For them, the bankruptcy filing of parent AMR Corp. means a smaller airline — with some losing their jobs, and nearly all of the rest losing something in pay or benefits.

AMR says it carries $800 million a year more in costs compared to other large airlines in employee pay, work rules, pensions and benefits. So Tom Horton, American's new leader, is clear what he wants out of bankruptcy.

"An objective of ours is going to be to create a cost structure that is more competitive with the rest of the industry, so down the line there may be changes in that regard," he said.

"Changes" means "cuts."

The Allied Pilots Association, representing American's 8,500 flying pilots and 600 others who are already furloughed, denies that its rejection of American's last contract offer to curb costs pushed the carrier into bankruptcy.

Union spokesman Howie Schack says the APA's top goal now is saving jobs. "We're hopeful that any reductions the airline might come up with in the near future would still need pilots to be flying the airplanes that remain," he said. "Our recent retirements are something that might save us from seeing additional furloughs."

Also at risk: American's four pension plans, covering almost 130,000 participants.

The Pension Benefit Guaranty Corporation, the government agency that would take over the pensions if American ends them, says a billion dollars in benefits could be lost.

The Association of Professional Flight Attendants, representing 17,000 American employees, expects a fight.

"The company will try to come at us for some changes to our benefits and our pensions, and we are going to do everything we can to get the best outcome and protect what we can," said APFA president Laura Glading.

Current employees could be forced pay a lot more for health insurance. In many reorganizations, retiree health benefits like American pays are cut completely.

Yet the unions for the pilots, flight attendants and ground workers also say they want to work with management for the best deals for all... and the airline's future.

E-mail bwatson@wfaa.com

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