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8.15.12 – (LAA) – Bankruptcy Court Issues Indictment of Labor Unions on AA’s Property


Judge Lane’s Decision (pdf)

Click here to download Judge Lane’s decision on APA’s contract. 

APFA Special Hotline – August 15, 2012

Late this afternoon, the Bankruptcy Court issued a blistering indictment of the labor unions on American Airlines’ property. The Court summarily rejected all but two arguments the pilots made in the Section 1113 hearing, including convergence – the argument that the company’s ask would put the pilots below industry standard. Most of the pilots’ arguments were identical to ours.The Court’s decision to reject the Company’s motion, as it pertains to the APA, was based on two specific arguments that were unique to the Company’s demand of the pilot work group. The Court decided that American did not need unlimited code sharing capabilities to reorganize its business. The second argument pertains to the Company’s request for permission to make unlimited furloughs to the pilots. The APA contract, as it stands, limits the number of furloughs American can impose at 2,000. The Company’s business plan stated that it needed 400 pilot furloughs in order to reorganize. The Court, therefore, decided that American did not need the ability to furlough an unlimited number of pilots. None of our arguments were equivalent to the two the Court sided with the pilots on.APFA’s legal counsel has stated that if the judge finds against AA’s motion to abrogate (as he did in part with today’s announcement), he will provide a clear roadmap to remedy any defects. Today’s decision contains that roadmap. American says it intends to re-file its motion to abrogate the pilots current contract this Friday.To reiterate, the remainder of the court’s 100+ page decision validated each of American’s arguments for its business plan and dismantled each of the unions’ cases against it.In fact, only two APFA arguments remain un-ruled upon by the Court: The first is our convergence argument, which included different evidence than the pilots’. The second is an information-sharing argument whereby we requested term sheets that pertained to non-unionized employees on the property and were not provided with them. The pilots requested other information from the Company that was not shared. The Court was unmoved by the pilots’ similar information-sharing argument.In short, today’s ruling postpones the inevitable abrogation of the pilots’ contract. Given the fact that most of our arguments have already been dismissed in this ruling, and that our LBFO addresses our arguments that are left outstanding, we do not expect the Court’s 1113 ruling to go in our favor – should we vote to reject the LBFO.It is more clear today than ever before that the best path for our membership is to accept the LBFO and continue to work towards achieving a merger with USAirways. We can now say with certainty that the Section 1113 process will leave flight attendants worse off than the LBFO. There is little doubt that the end result, should we reject, will be 2,000 furloughed flight attendants and many many more on reserve.The Court’s ruling, in it’s entirety, is posted on our web site. Please take the time to examine it. Additionally, our professionals have excerpted certain pertinent facts and provided helpful explanations. Those will soon be available on the APFA website as well.AmericanAirlines + US Airways

“Our Future Depends On It”APFA Headquarters
Tel. 817.540.0108

This is Leslie Mayo, National Communications Coordinator, with an Special Hotline Update for Wednesday, August 15, 2012.

In an historic ruling, AA’s 1113 motion has been denied by Judge Lane. Below is excerpt of the 105-page ruling. As soon as our professionals have had a chance to review the judge’s decision we will have more information and what this could mean for APFA Members.

“The Court concludes that American’s proposed changes to furlough and codesharing have not been justified by either reference to the Business Plan or the practices of American’s competitors. Given the significance of these two provisions collectively to American’s proposal, the Court finds that American has not shown that the proposal is necessary as required by Section 1113. For the reasons set forth above, therefore, American’s Motion to reject the collective bargaining agreements of the APA is denied.” 

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