Angry Workers At American Airlines WHY AM I NOT SURPRISED AND WE GAVE THE AIRLINES MORE MONEY VIA CONGRESS

[Dave Farber <dave () farber net>]

Angry Workers At American Airlines
FORT WORTH, Texas, April 18, 2003
American Airlines, which dodged bankruptcy this week, finds itself in the
middle of another firestorm as employees facing huge pay cuts react angrily
to news that top executives were promised big bonuses.

The executives' deal, which includes a pension fund that protected the
benefits of top executives in case of bankruptcy, was disclosed in a filing
with the Securities and Exchange Commission by American's parent, AMR Corp.

Few employees learned of the executive benefits until after they had agreed
to $1.8 billion in wage concessions.

Leaders of all three of the airline's biggest unions say they are talking to
lawyers to see whether they can prove that American negotiated the
concessions deals in bad faith.

"It's the equivalent of an obscene gesture from management," said John Ward,
president of the flight attendants' union, which rejected concessions - then
approved them after the union and the company agreed to extend voting by one
day. 

Just Wednesday, the mood at American's Fort Worth headquarters was one of
celebration after the union narrowly approved the concessions deals.

"We have all shared in the sacrifices necessary to restructure our costs,
and I have every reason to believe that by working together, we will be
successful in creating a leaner, smarter, more competitive airline," a
beaming chairman and chief executive, Donald J. Carty, declared. Employees
cheered. 

By Thursday, James C. Little, the leader of the ground workers' union, was
having none of the teamwork pep talk. Little suggested he may refuse to sign
a labor-concessions agreement - even if that pushes the world's largest
carrier into bankruptcy.

In an interview, Little said that the union's 34,000 members at American
might have rejected the agreement if they had known about the executive
perks. He said he was talking to union lawyers about his next move. Pilots'
union president John Darrah said he also was talking to attorneys.

According to the SEC filing disclosed late Tuesday, the company funded a
pension trust for 45 top executives in October that protected some of their
benefits even if the carrier filed for bankruptcy protection.

In addition, the company offered its six top executives bonuses double their
annual base salaries if they remain until early 2005.

Carty, who has a base salary of $811,000, could get a $1.6 million bonus at
a time when employees will still be struggling under huge pay cuts.

Bruce Hicks, a company spokesman, said the retention benefits were a
standard policy at many large companies to prevent senior executives from
leaving. He also said the supplemental pension plan is similar to one for
American's pilots. 

Employees were also angered that the company delayed filing the SEC
documents until the last scheduled day for employees to vote on the
concessions deals. 

The flap appears to have already worsened management-labor relations at a
company famous in the industry for bad relations.

"People have this view of management. They don't deal fairly with their
employees," said Ward, the president of the flight attendants' union. "You
ask probing questions and they dodge the question or they provide limited
information or just don't provide it."


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