Dec. 08-- Bankrupt American Airlines' Allied Pilots Association has accepted the company's latest contract offer that includes 31 percent to 39 percent wage increases over six years and a 13.5 percent equity stake in the reorganized company, APA executives said Friday.
In balloting that began last month and concluded at noon Friday, a majority of 8,000 APA members reversed course from their rejection in August of the company's previous contract offer.
The results of the balloting were: 5,489 votes (74 percent) for the contract agreement, 1,951 votes (26 percent) against.
APA President Keith Wilson said 96 percent of eligible APA members participated in the ratification balloting.
"I want to thank everyone who took the time to cast a vote in this important ratification process," Wilson said in an email message to union members. "APA will now turn its focus to helping to ensure that full consideration is given to strategic alternatives before American Airlines' restructuring concludes. The APA leadership continues to support a merger with US Airways as the best path to a stronger, more competitive American Airlines that will in turn enhance our pilots' long-term career prospects."
APA executives said the contract would eventually raise pay in line with pilots at United Airlines and Delta Air Lines.
In exchange, American received more flexibility to outsource flying to other airlines.
All three of American's labor unions now have ratified contracts.
"This agreement addresses the priorities identified by the APA during collaborative talks," said Denise Lynn, American's senior vice president -- people. "Today's ratification gives us the certainty we need for American to successfully restructure, providing opportunity and growth for all of our people and stakeholders. The modernization of our company is well under way, and we remain focused on emerging as a competitive, world-class airline."
Following the ratification vote, lawyers for American parent AMR Corp. filed a motion in U.S. Bankruptcy Court to shorten the notice period and authorize American to enter into a collective bargaining agreement and settlement letter with the APA. The company requested a hearing on the matter at 10 a.m. Dec. 19.
American executives said the company worked with the APA to develop an agreement that includes items important to pilots while keeping within economic parameters endorsed by the Unsecured Creditors Committee that support American's successful bankruptcy reorganization.
Before the ratification vote, the Transport Workers Union, including more than 5,000 mechanics and related workers at American's Maintenance & Engineering Center in Tulsa, and the Association of Professional Flight Attendants ratified their contracts in August.
In a letter to American employees, Chairman and CEO Tom Horton said the agreement with the pilots is an important milestone. Along with the new labor agreements, the company is introducing 60 new aircraft to its 600-aircraft fleet in 2013 as well as new products and services, American's CEO said.
"As we bring our restructuring to a close, we are also completing our review of strategic alternatives," Horton said. "As you know, we have been evaluating the merits of a combination under a non-disclosure agreement with US Airways. While we are confident the new American will be very strong, we are evaluating whether such a combination could create value for our owners and a positive outcome for our people and our customers. We expect to have a conclusion on this soon."
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