AA, pilots' union reach tentative deal

Agreement means pilots could vote to ratify contract within three weeks

Published On: Nov 09 2012 05:47:57 PM EST   Updated On: Nov 11 2012 03:02:38 AM EST

American Airlines announced Friday it had reached an "agreement-in-principle" with its pilots' union.

American Airlines spokesperson Bruce Hicks issued a statement on the tentative deal, saying: “We are pleased to have reached an agreement-in-principle with the Allied Pilots Association. We worked hard with the APA’s negotiating committee to structure an agreement that addresses the priorities identified as most important to our pilots, while staying within the economic framework supported by the Unsecured Creditors’ Committee to ensure American’s successful restructuring. As the APA communicated, the APA Board of Directors will proceed in compliance with policy-manual requirements and vote to send the agreement-in-principle to the membership as a tentative agreement for a ratification vote.”

The agreement means AA's roughly 8,000 pilots could vote to ratify the contract within three weeks. If approved, the contract would help pave the way for the Fort Worth, Texas-based airline to exit bankruptcy. AMR Corp., the parent of American Airlines, filed for Chapter 11 protection last November. It has reached labor agreements with all of its unions except for the pilots.

The pilots rejected a prior contract proposal this summer designed to save American more than $300 million a year. American then won permission from the bankruptcy court in September to impose new pay, benefit and work rules on pilots. The airline has about 7,500 active pilots.

Seth Kaplan, managing partner of the industry publication Airline Weekly, said pilots would have gotten a deal had they taken the contract offered in June.

Instead, it was rejected.

"American's pilots were actually better off than most other airline's pilots because the other airlines had already gone bankrupt and gone through this very difficult process with their pilots," Kaplan said.

"This process is about trying to find that happy medium where the airline can make money and pilots can make a living," Kaplan added.