February 17, 2012
American Airlines’ devastating bankruptcy
Despite having $4 billion in the bank, the parent company of American Airlines, AMR, has filed for bankruptcy and seeks to eliminate 13,000 jobs and dump its pension responsibility onto the federal government. Previously, American Airlines was the only major U.S. carrier not to go through bankruptcy after 9/11, due in large part to major concessions from its employees’ unions in 2003.
The bankruptcy filing came just weeks after the company concluded contract negotiations with the Transport Workers Union, leaving TWU President James Little to question whether AMR is trying to get through bankruptcy what it couldn’t get at the bargaining table.
Adding to the outrage is that AMR has hired Bain & Co. to advise it through the bankruptcy process at a cost of up to $1,100 per hour. Bain is the notorious company where Republican presidential candidate, Mitt Romney, worked before entering politics.
Up to forty percent of the job losses will come from American’s maintenance and baggage handling divisions – including a hundred workers at Raleigh Durham International Airport. Earlier this week, we received a letter from TWU Local 569 political coordinator, Jack Anderson, asking for our help – for all of our help – to support American jobs in the face of outrageous corporate greed:
My name is Jack Andersen. I am an employee of American Airlines at RDU, and a member of the Transport Workers Union Local 569. I’m writing you to enlist your support.
As you have probably heard, American Airlines is in bankruptcy proceedings. In its bankruptcy plan, American plans to outsource much of its ramp and aircraft maintenance work to outside vendors. A total of 8,800 living wage jobs in just these two departments would be lost. American also intends to reduce its pilots by 400, flight attendants by 2,300 and management by 1,400. For a total of almost 13,000 jobs lost.
Let me tell you how this will affect us locally. For the Triangle area, this means about one hundred families will either be relocated to other cities in the American Airlines system, or be laid off to collect unemployment. Another blow to our local economy. The employees losing these jobs have been with American for at least twenty five years and have been active in the Triangle economy for at least as long. They will be replaced by low paid contract workers. In 2003, TWU members voted to give up one-third of our pay and benefits in order to keep American from going bankrupt. It’s unfair to now eliminate so many jobs. We need middle class jobs and good wages to help improve the economy in our community.
American now leads the industry in repair work performed at safe, secure U.S. based facilities, where we also work on many other carriers’ planes. Unlike competing carriers, American has not outsourced its repair and overhaul work to overseas shops that do not have routine FAA oversight. With the layoffs of 4600 mechanics, and the closing of our Ft. Worth maintenance base, that would change. American would also like to shed its pension commitments (9 billion dollars), burdening the Pension Benefit Guarantee Corporation, and possibly taxpayers if the PBGC couldn’t handle such a debt.
I know bankruptcies are contentious. I’m not asking you to pick a side. That said, I would like you to sign an online petition letting American Airlines know that it’s not OK to replace so many middle class jobs with non living wage jobs. It’s not OK to export so many highly skilled jobs overseas. This might be good for stockholders, but it’s not good for America. American employees have already given up much to save our company. We know we’ll have to give up more in bankruptcy, but American Airlines is asking too much. From us, and our communities.
You can view and sign our online petition at isupportamericanjobs.com. If you would like more information, please email me at firstname.lastname@example.org, or phone me at 919.818.0417.
EDIT: Glenn Jeanes is the president of TWU Local 569.