January 31, 2012
Dear APFA Members,
We are standing on the precipice of a very stressful and tumultuous time in this bankruptcy. Tomorrow, AMR management will issue its initial proposal for reorganizing the contracts of the company’s labor groups. Our experts and I expect this proposal to include drastic cuts across the board. Further, I expect dismay and outrage from our membership as details are made public.
Those reactions are justified but I urge you to remain calm. Our strategy for negotiations will remain unchanged.
I have said before, both in public and in bankruptcy proceedings, that American Airlines needs a fresh business plan that guarantees a new and profitable direction for the company. Without a strong plan that has been vetted by our legal and financial experts we cannot be expected to have productive contract negotiations, and the company knows this.
Among the things I will be looking for in a business plan are pay-for-performance policies for management. You all shared my disgust as management awarded themselves exorbitant bonuses as they dismantled the airline we all worked so hard to build. As the APFA President and a dedicated employee, I never want to see that happen again.
I also want to see a new strategy that returns American Airlines to competitiveness on profitable routes. Simply slashing routes that lose money is not a business plan.
Flight Attendant costs are not this airline’s problem. Our salaries and benefits are competitive with our major competitors. “Convergence” has occurred and with the recent agreements at the other major airlines, we are even falling behind some Flight Attendants. Gutting our contract will not return American Airlines to profitability.
As I have said throughout the informational bankruptcy base visits, American Airlines’ problem is one of revenue. Mismanagement and disorganization has made our company uncompetitive. We need top-down improvements, not bottom-up cuts. If the company cannot implement major business changes in this bankruptcy, then we do not have the right management team in place.
Make no mistake, the proposal tomorrow will be ugly. But remember that it represents the beginning of a long process for which our tenacious experts and I are well-prepared. I will not rest until the jobs and retirement plans of each member of the Association of Professional Flight Attendants are safe and secure. It is an awesome responsibility that I take very seriously.
Please refer to APFA.org and these hotlines in the coming days and months for the best and most accurate information regarding bankruptcy proceedings.
Union President Wants Strong Biz Plan Ahead of AMR Section 1113 Proposal
APFA President Laura Glading Calls for New Direction to Accompany Contract Negotiations
Jan. 31, 2012 (Fort Worth) – Laura Glading, President of the Association of Professional Flight Attendants, issued a statement today in advance of a seminal moment in AMR’s ongoing bankruptcy proceedings. Tomorrow, American Airlines will present proposals for the changes to its labor contracts under section 1113 of the bankruptcy code.
“We are standing on the precipice of a very stressful and tumultuous time in this bankruptcy.” Ms. Glading said in a statement to her members. “Our experts and I expect this initial proposal to include drastic cuts across the board. Further, I expect dismay and outrage from our membership as details of the proposal are made public. I urge you to remain calm. Our strategy for negotiations will remain unchanged.”
Ms. Glading went on to say that the key aspect of this bankruptcy is the company’s business plan and without a viable direction, contract negotiations will be unproductive. She and a team of legal and financial experts will review AMR’s plan in the coming months, but she pointed out some of the things she will be looking for in the plan:
- Pay-for-performance standards for American Airlines management. Executives drew the ire of employees and the public in recent years when their annual bonuses did not align with the profitability of the airline.
- Growth in profitable routes. Ms. Glading called on management to do more than cut routes that don’t make money. She wants to see growth and competitiveness in key routes that American Airlines once dominated.
Ms. Glading also called on management to negotiate in good faith with the APFA.
“Our Flight Attendant costs are competitive with the other major carriers. In 2003, American Airlines experienced a virtual bankruptcy and we gave back 30 percent of our salaries and benefits. The Flight Attendants are making 37 percent less in real dollars today than they were in 2003. I will continue to demand credit for those givebacks as contract negotiations continue through bankruptcy.î
Ms. Glading reiterated public statements she had made previously, stating that the problems plaguing American Airlines are not strictly cost-related. Mismanagement at the highest level has led to a revenue gap between American Airlines and its competitors.
According to Ms. Glading, “We need top-down improvements, not bottom-up cuts. If the company cannot implement major business changes in this bankruptcy, then we do not have the right management team in place.”
About APFA – Founded in 1977, the Association of Professional Flight Attendants (APFA) is the largest independent Flight Attendant union in the nation. It represents more than 16,000 Flight Attendants at American Airlines. APFA Members live in almost every state of the nation and serve millions of Americans as they travel the nation and the world. In 2003, APFA played a major role in keeping American Airlines solvent and out of bankruptcy by giving back an employee bailout of $340 million in annual salary and benefits, for a total of over $2 billion and counting. APFA had been in negotiations with American for almost four years when the carrier filed for chapter 11-bankruptcy protection on November 29, 2011. Laura Glading is serving in her first four-year term as president of the union.