American union still debating contract
BY JOHN STANCAVAGE World Business Editor
Tuesday, August 07, 2012
8/07/12 at 3:48 AM
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Several factions of the Transport Workers Union continue to argue over the merits of a new contract offer from American Airlines as the deadline to vote on the deal approaches.
Mechanics and stock clerks already have rejected one proposal from the bankrupt airline and currently are voting on a sweetened offer. The deadline to cast ballots is 11:59 p.m. Tuesday. Voting began July 23.
The latest offer includes 15 percent wage increases over six years, improved health insurance and other benefits for mechanics, and 10.5 percent wage increases and improved benefits for stock clerks.
Of the 10,000 total TWU-member mechanics and related workers, more than 5,000 are in Tulsa. The group here, in fact, has become the key target for both "yes" and "no" factions.
On July 27, those opposing the contract took out a large newspaper advertisement to encourage the local workers to stand with them.
It appears that at least some concentrated pockets of resistance are located in union shops in Dallas-Fort Worth; El Segundo, Calif.; and New York. Those areas all have a higher cost of living than Tulsa, which may be contributing to the desire for a better deal.
Tulsa has its share of "no" voters as well, however, and the vote could be close.
John Hewitt, TWU Local 514's chairman of maintenance in Tulsa, said in a telephone interview Monday that he personally is voting for the offer. It also has been endorsed by the Local 514 executive board.
"I have been visiting with other union members, giving them information and telling them what the experts say," Hewitt said. "I know how I am going to vote myself, but I am telling them that they need to cast their votes based on what they think is best for them and their families."
The Local 514 took out its own newspaper advertisement Sunday to counter the "no" contingent.
"If we reject the tentative agreement, it is almost certain that our present collective bargaining agreement will be abrogated by the bankruptcy court in New York sometime in the next few weeks," the ad stated.
A judge would have to rule that American can throw out the existing contract. After that, American would be free to impose a March 22 "term sheet," which offers stingier compensation.
American has stated its goal is to reach consensual agreements with all union groups. but Hewitt said he thinks the company would impose the term sheet if it had the opportunity.
According to the Local 514's advertisment, those undesirable terms include "2,000 more layoffs than the proposed agreement, substantially more outsourcing ... significantly less in scheduled pay, increases ... and no provisions for automatic adjustments of pay increases to industry standards after the third year."
Overall, the Local 514 leadership said, the March 22 term sheets would mean "tens of millions of dollars of additional sacrifice" for its members.
In contrast, many of the union's "no" voters are skeptical that American would impose the term sheet quickly and believe they still can reach a better deal with the company through a new round of talks.
Gary Peterson, president of TWU Local 565 at Dallas-Fort Worth International Airport, has called the current contract offer "lipstick on a pig."
"There's no new money involved in the discussion," he said recently. "There is no system protection or job guarantees or cap on the number of people they can lay off. They can lay off, by seniority, any amount they need to in any location they choose to."
Those opposing the contract said in their ad that the deal would offer no job security, more outsourcing, greater layoffs, unspecified changes in overtime and field trip rules, frozen pensions and reduced vacation.
Also, the "no" voters allege the specific local impact would be "no guarantee of future work at TULE (Tulsa maintenance and engineering center), plus 35 percent outsourcing of current work."
Hewitt disputed the accuracy of those charges and said that's why his group responded with an ad of its own.
Overall, American Airlines employs 7,000 in Tulsa, most at its maintenance base. The airline has said it may cut 2,100 mechanics locally, plus several hundred other workers. The airline also plans to close its repair facility in Fort Worth.
American Airlines has told Texas officials that it expects to lay off 40 cargo workers at Dallas-Fort Worth International Airport in late September.
In a letter to state officials, the airline linked the job losses to the company's attempt to cut spending as it restructures under bankruptcy protection.
"Regrettably, reducing our costs requires that we must make a number of tough decisions. Several of these very difficult decisions include a reduction in force," Michael J. Waldron, American's managing director of diversity and talent development, said in a letter to the Texas Workforce Commission.
Waldron said that 36 cargo agents and four coordinators would lose their jobs around Sept. 21.
The state agency released the letter Monday, the Associated Press reported.
AMR Corp. in bankruptcy
The company filed for bankruptcy on Nov. 29, 2011, after losing more than $10 billion in the past 10 years.
On Feb. 1, the 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 job 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 five TWU work groups. TWU mechanics and stock clerks, the Allied Pilots Association and the flight attendants will conduct ratification votes on tentative contract agreements in the next three weeks.
The TWU and the pilots began voting July 23 week on new contracts with AMR. The TWU's tentative contract agreement includes 15 percent wage increases over six years, improved health-care coverage, market wage readjustment - based on industry compensation, after 36 months - and a provision to reopen full contract negotiations after four years. The company has not provided revised layoff numbers. The TWU voting will conclude at 11:59 p.m. CDT Tuesday.
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.
2,100: Most recent number of proposed job cuts in Tulsa
$75 million: Money AMR had spent through June on bankruptcy costs.
$10 billion: AMR's losses in the past 10 years.
$1.25 billion: The money AMR hopes to save in labor expenses on an annual basis.
Original Print Headline: American union still debating contract
John Stancavage 918-581-8314