American Airlines flight attendants rejected a concession agreement today aimed at preventing the carrier from filing for bankruptcy.
The company issued a statement this afternoon, however, announcing that its three unions endorsed an agreement that would allow the Association of Professional Flight Attendants members to change their votes until 5 p.m. Central Time tomorrow.
 American Airlines says it needs three union deals to avoid bankruptcy |
The flight attendants rejected $340 million of contract concessions by fewer than 500 votes out of more than 19,000 cast.
The airline, a division of AMR Corp., has said it would be forced to file for bankruptcy if its three major union groups do not ratify agreements that will help save the carrier $1.8 billion a year in labor costs. Pilots and mechanics approved deals earlier in the day.
American said it set the April 15 deadline for ratification of the union agreements because it had a substantial amount of loan repayments due. The company will make millions of dollars in payments today, it said, in order to extend the deadline.
“With almost 10,000 jobs hanging in the balance and the future of 100,000 employees at stake, we agreed to take this risk and make this investment for our employees because we believe that all employees will be better off if we can save jobs and restructure our costs consensually rather than through the bankruptcy process,” AMR Chairman Don Carty said. “This is our last chance to avoid bankruptcy.”
With another round of loan payments due tomorrow, Carty said, the company must have consensual agreements in place.
“So that there is absolutely no confusion or uncertainty, I must make completely clear that if we fail to secure flight attendant ratification by tomorrow, we are – regrettably – left with no alternative but to immediately file for bankruptcy,” he said.
The Allied Pilots Association approved the concessions 69 percent to 31 percent. The union said 10,200 of the company’s 12,000 pilots participated.
Ground workers, with the Transport Workers Union, approved their deal by 53 percent to 47 percent.
“To willingly take our airline and our company into bankruptcy would not be a better alternative,” John Darrah, president of the pilots’ union, said after the pilots’ vote. “There is no upside to bankruptcy.”
Fort Worth-based AMR says it is losing $5 million a day and has lost nearly $5.3 billion in the past two years.
