News Column

Fort Worth TWU Workers Could Take Tulsa Jobs

Aug 14, 2012

John Stancavage

On the surface, the Transport Workers Union's approval of a new contract with American Airlines last week would appear to have saved about 1,400 Tulsa jobs.

But for existing local workers, it's more complicated than that.

American Airlines, which is trying to cut $1.06 billion in labor costs to help it emerge from bankruptcy, originally planned to eliminate 2,100 mechanics at its Tulsa maintenance base. The deal approved by the TWU on Aug. 8 -- the second offered by American while it has been under Chapter 11 protection -- reduced that amount to 770.

A second TWU group, stock clerks, also approved a pact that lowered cuts in Tulsa from a planned 160 to 90.

Still, there's another event that's quietly looming -- the planned closure of American's repair base at Alliance Airport in Fort Worth. Because of union "bump-and-roll" provisions, some of the more than 1,500 TWU mechanics there will have the option to move to Tulsa.

The bump rules are complicated, but seniority is a big factor. So, younger members in Tulsa undoubtedly will be displaced by some Fort Worth workers.

"There's no way to tell at this point how many that would be," said John Hewitt, chairman of maintenance at TWU Local 514, in a telephone interview. "There's a lot of moving parts."

So, the bottom line is that it's possible more than 770 of Tulsa's existing mechanics may lose their jobs.

In purely economic terms, the impact on the city will be lessened slightly by Texans moving here and buying homes, but the situation also means some longtime Tulsans will be put out of work and may lose their houses if they can't find other positions.

American has told the union it wants to close Alliance and redistribute employees and work in the next six to nine months, Hewitt said.

Sam Cirri, president of TWU Local 514, alluded to the situation last Thursday in a letter to members.

"Dealing with this bankruptcy process has put a lot of stress on all of us and our families and, yet, we still have a lot of work and sacrifice ahead of us with layoffs and the movement of people and work," he said.

Cirri said the Local 514 will be notifying Tulsa Area United Way agencies, the state unemployment office, resume firms and other service providers to help members who are laid off.

"We are also in the process of making more medical insurance options available, whether (members) stay with the company or not," the president said.

Mike Neal, president and CEO of the Tulsa Metro Chamber, also said his group is ready to help.

"While aviation and aerospace remain key industry sectors in the region's economic development success," he said, "it is the human capital -- our highly skilled work force -- which allows these industries to thrive.

"We will intensely focus our resources toward the present and future economic and human well-being of displaced workers and their families."

Another "moving part" in the layoff scenario is that the TWU's latest contract includes an early-out provision.

"It's not early retirement, although that's what some people are calling it," Hewitt said. "It's a deal for someone to leave the company early."

Under the program, a mechanic who is 45 years old with 15 years with the company could be eligible for a $12,500 cash payout, plus $10,000 and 13 weeks' severance pay.

AMR will announce a time period when TWU members can elect to leave, he said.

As a result, it's possible some Texas workers could move to Tulsa to take jobs left open by those taking advantage of the exit program.

Along with the closing of Alliance, there's another action that will hit Tulsa before American emerges from bankruptcy. The carrier has said there will be layoffs outside of what's been announced for its unions.

In Tulsa, where there are 7,000 total employees, there could be several hundred more jobs cut beyond the mechanics and clerks. Officials have declined so far to be more specific.

Overall, it means there could be close to 1,000 people locally looking for aerospace-related work next year.

Tulsa recently has enjoyed a boom in the industry, with firms such as Lufthansa Technik adding significant jobs.

The TWU's Hewitt said he has heard about interest in American employees.

"I think the other companies out there in Tulsa realize the experience our workers have," he said.

TWU workers who survive the cuts will be working under a new contract that includes 15 percent wage increases over six years, improved health-care coverage compared with previous offers, market wage readjustment -- based on industry compensation -- after 36 months and the ability to reopen full contract negotiations after four years.

The contract, however, also permits the company to outsource up to 35 percent of aircraft maintenance now performed in-house. That worries union officials, who are trying to persuade American to take on more maintenance for other carriers.

"Third-party work, however, isn't currently part of American's plan to exit bankruptcy," Hewitt said. "That's a major concern to us because the company also is going to be buying new planes that don't need as much maintenance.

"We've done some contract work in the past and we're doing a little bit now. Everybody we do work for seems real happy with it." AMR Corp. in bankruptcy Key developments

Company filed for bankruptcy Nov. 29, 2011, after losing more than $10 billion in the last 10 years.

On Feb. 1, company announced a plan to cut 13,000 jobs, including 2,100 Transport Workers Union jobs in Tulsa. Since then, the estimates have been reduced to 9,740 jobs cuts companywide.

US Airways is actively pursuing a merger with American Airlines. In April, US Airways CEO Doug Parker reached tentative contract agreements with American's Allied Pilots Association, Transport Workers Union and Association of Professional Flight Attendants. The tentative agreements would become effective with the merger of American and Tempe, Ariz.-based US Airways. A merger would result in layoffs of 450 TWU members in Tulsa and 4,900 mechanics, baggage handlers and other ground workers companywide.

American negotiators have reached contract agreements with all seven TWU work groups. The Allied Pilots Association rejected its contract and faces terms being imposed on its members. The flight attendants are scheduled to complete contract voting by Aug. 19.

Key dates

On July 19, U.S. Bankruptcy Judge Sean H. Lane in New York approved AMR's request to extend its exclusive right to present a reorganization plan to the court until Dec. 28 and to extend until Feb. 28 of next year a deadline to solicit votes on that plan.

Key figures

860: mechanic/related and stock clerk job cuts planned in Tulsa, with up to several hundred other jobs in other categories also on the line in Tulsa.

$75 million: money AMR had spent through June on bankruptcy costs.

$10 billion: AMR's losses in the past 10 years.

$1.06 billion: the money AMR hopes to save in labor expenses on an annual basis.

Source: (c)2012 Tulsa World (Tulsa, Okla.). Distributed by MCT Information Services

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