Judge Invalidates AMR Pilot Contracts
FORT WORTH (CBSDFW.COM/AP) - Just weeks after what American Airlines pilots called a historic victory to save their work contracts, a federal judge agreed Tuesday to let those contracts be canceled.
Judge Sean Lane agreed with American Airlines' request Tuesday to cancel its contracts with the Allied Pilots Association. The decision will allow the airline to proceed with as much as $370 million in cuts to help the corporation climb out of bankruptcy.
"We appreciate Judge Lane's thoughtful consideration of our renewed Section 1113 motion regarding the pilot contract. But, there is no sense of accomplishment in this outcome," said American Airlines spokesman Bruce Hicks in a statement after the decision.
APA spokesman Tom Hoban said that it gives the company the right to essentially impose whatever working terms it wants to. "The pilot contract is the underpinning of the profession, and what this does is essentially tear that into pieces," Hoban said. "It puts us into a very bad position."
American Airlines said that it would inform pilots of changes to work rules within days.
Fareportal executive and former airline executive Mark Drusch said that the impasse was a sign of just how bad the relationship is between the company and its pilots. "I really think it gets back to years of bad repoire between the airline management and their pilots," he said.
With no contract, no clear strategy moving forward and early talk of a strike preparation vote, Drusch said that a work slowdown is also now a very real possibility. "It'll slow down reorganization," he said. "It'll cause problems for all of us in North Texas. It's a bad situation. But it's the last card pilots have to play."
New APA president Keith Wilson sent a message to members on Tuesday night, telling them to be careful and maintain professionalism.
The four-hour hearing in New York primarily focused on codesharing and furloughs, two areas the judge thought American Airlines had not justified in its previous motion. The company made adjustments to both criteria for Tuesday's motion. Pilots also face lower pay raises, less pay for sick time and time spent not flying.
Pilots may still carry some leverage because the unsecured creditors said Tuesday in court that some sort of an agreement between the two sides will be necessary for the airline to emerge successfully from bankruptcy. Drusch said that potential merger investors will also likely want any impasse settled before getting involved financially with the company.
(©2012 CBS Local Media, a division of CBS Radio Inc. All Rights Reserved. This material may not be published, broadcast, rewritten, or redistributed. The Associated Press contributed to this report.)
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