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American Airlines' Pilots Vote 69% to Approve Contract

May 06, 1997|JAMES F. PELTZ | TIMES STAFF WRITER

American Airlines' pilots ratified a new contract by a comfortable margin Monday, ending more than two years of heated bargaining that boiled over into a fleeting strike against the nation's second-largest airline.

The 9,300 pilots voted 69% in favor of the settlement, which was tentatively approved last month by the directors of their union, the Allied Pilots Assn.

"We're very pleased," American President Donald Carty told a news conference. "Now we can get on with the business of a very busy summer season."

Both sides came away with less than they wanted. The pilots will get a 9% pay hike over the five-year term of the contract, which is more than American initially offered.

The pilots, who now average about $120,000 a year, also will divide stock options covering 5.75 million shares of stock in American's parent, AMR Corp.

But the pilots failed to achieve another goal, which was to ensure that only APA pilots be allowed to fly the small commuter jets that American plans to add to its regional airline, American Eagle, which now flies mostly turboprop aircraft.

American wants to fly those new planes with American Eagle pilots, who earn about $35,000 on average and are represented by a different union. The APA pilots wanted to fly them because they see the planes and their lower-paid crews as a threat to their jobs if the planes eventually replace American's bigger aircraft on certain routes.

But APA President James Sovich said the pilots "realized it's time to move forward. We've demonstrated in the past that if the company treats the pilots fairly, they'll give 150%. If they don't, they won't."

Carty said that "while they [pilots] might not have had everything they wanted in the contract, you seldom do."

The approval came after two years of bargaining, months of federally mediated talks, the strike and then more negotiations.

After the pilots rejected the first proposal in January, negotiations broke down and the pilots threatened to strike on the morning of Feb. 15. The nation's travel system braced for chaos, and American made plans to ground its 640-plane fleet.

But the strike ended almost as soon as it began, because President Clinton ordered the pilots back to work and appointed an emergency board to help settle the dispute.

Even so, the threat of the strike cost American about $70 million in this year's first quarter, owing to passengers canceling flights, booking reservations elsewhere and other related costs, Carty said Monday.

"There will be a small additional [financial] hit in the second quarter, but we haven't quantified that," he added.

But having the contract in hand also clears the way for American to proceed with a giant $6.6-billion order to buy more than 100 Boeing Co. jets over the next 20 years. That order, signed last year, was contingent on reaching the new pilots contract.

Associated Press contributed to this report.

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