Union Leaders Urge American Air Pilots to Reject Contract
Dow Jones Business News
FORT WORTH, Texas -- In the first high-level opposition to extending a pilots' contract with AMR Corp.'s American Airlines, two union leaders have urged members to reject a tentative agreement because of UAL Corp.'s United Airlines unit's generous package for its pilots.
United Airlines' recent pact with its pilots, which includes an immediate raise of 21.5% to 28.5%, prompted the opposition by two leaders of the Allied Pilots Association, which represents American Airlines pilots. Both union leaders previously supported the one-year contract extension with American, which calls for a 5.5% pay raise.
An 'overwhelming 'no' vote' would send the message to American management that the tentative extension is no longer adequate in light of United's pact with its pilots, wrote Phillip Beall, chairman of the Allied Pilots Association's Dallas-Fort Worth base, and vice chairman Jeff Sheets in an e-mail. More than 2,600 pilots are based at Dallas-Fort Worth International Airport. 'The negotiating floor has been substantially raised' on a number of issues by the United settlement, the two leaders wrote.
The United agreement includes improved benefits and work-rule changes that analysts and industry insiders believe would establish a new standard for pilot compensation.
Earlier this week, Donald Carty, chief executive of AMR (AMR), offered to start early negotiations on a new contract if the pilots approved the one-year extension. Ratification ballots for the extension were mailed Thursday to almost 11,000 union members and will be counted Sept. 20.
In July, the union's board voted to recommend approval of the deal reached by the airline and union negotiators. It would give pilots a 5.5% pay increase by Aug. 31, 2001 while letting the airline expand its use of 50-seat regional jets at its lower-cost American Eagle commuter division, which the union feared could reduce flights for its members.
The deal would also relieve the union of liability for a $45.5 million fine it received after a pilots' sickout in
February 1999.
Separately, American said federal mediation with the Association of Professional Flight Attendants will begin Sept. 13 in Dallas. The airline said it is prepared to sign a new labor pact with its flight attendants that matches any of its 'big six' competitors.
The company requested mediation by the National Mediation Board last month to resolve talks over pay,
retirement and other issues. But the flight attendants declined to join the company in that request.
(Compiled from Dow Jones Newswires and other sources)