Lawyers for American Airlines filed new documents Friday asking a federal bankruptcy judge to review their revised term sheet and reconsider throwing out the company's contract with its pilots union.
The court scheduled a hearing on the motion for 1 p.m. Sept. 4.The motion submitted to U.S. Bankruptcy Judge Sean Lane was revised to address two points the judge raised in his Wednesday ruling that denied American's first request to abrogate the contract with the Allied Pilots Association.In his ruling, Lane said, "American has established that significant changes are necessary to the APA's collective bargaining agreement for reorganization" and that "labor costs for pilots are among the highest of its network competitors," adding to the airline's continuing losses.But the judge said the airline needed to revise proposals in the Section 1113 plan that would have given management "unrestricted use of furlough and code-sharing where such unfettered discretion has not been justified as necessary."American spokesman Bruce Hicks said the new motion specifically addresses those two issues."On code-sharing, we revised our proposal to include what the APA leadership had agreed to in the tentative agreement," Hicks said, referring to a proposed contract that American pilots overwhelmingly voted down last week."For pilot furloughs, we will keep the current contract limits," Hicks said. "We believe both of those changes properly address the court's concern and will allow the 1113 to move forward quickly."American officials have said the revised proposal would allow significant code-sharing with Alaska Airlines, with Hawaiian Airlines on interisland flights and with some other airlines on domestic flights.The unions view code-sharing as a way for the airline to boost revenue-generating flights without providing more jobs to union members.Meanwhile, American's flight attendants have until 10 a.m. Sunday to vote on the company's final contract proposal to the Association of Professional Flight Attendants.In recent days, the union leadership has warned members that they will be significantly better off with the tentative agreement than if they reject the contract and American imposes its term sheet.The company's proposed six-year contract provides for a $1,500 signing bonus, an initial 3 percent pay raise and a 5.5 percent matching 401(k) contribution.The union would also receive a 3 percent equity stake in the reorganized company, which could be monetized and distributed to union members.The unsecured creditors committee has endorsed contract agreements reached with ground workers, the one being voted on by the flight attendants and the one rejected by the pilots.The committee released a statement Thursday saying it "agreed to reluctantly support the equity stakes negotiated by" the unions."This was a difficult decision for the Committee to reach because of the dilutive effect these equity stakes and unsecured claims may have on other creditors, but the Committee's action recognizes that consensual agreements benefit everyone."Bob Cox, 817-390-7723Twitter: @bobcoxict
Bankruptcy judge's opinion on American Airlines' pilots contract (PDF)
Horton: American will decide on merger in weeks
Pilots union leader resigns after American Airlines contract is rejected
Pilots soundly reject contract offer from American Airlines
American pilots' union calls yes vote 'a leap of faith'
American's unions on hot seat on contracts
Judge objects to parts of American's proposal
Flight attendants union: Court ruling is clear message to approve contract or else
Keep up with American Airlines' proposed merger in the Sky Talk blog
Have more to add? News tip? Tell us
