Part 1:
American union pulls out of deal, bankruptcy possible - Apr. 19, 2003
American union pulls out of deal
Flight attendants will vote again on concessions to avoid bankruptcy due to outcry over exec pay.
April 19, 2003: 1:58 PM EDT
By Chris Isidore, CNN/Money Senior Writer
NEW YORK (CNN/Money) - American Airlines' flight attendants union announced it would hold a new vote on $340 million in annual concessions due to outcry over a compensation plan for the airline's management, a move that could force the world's largest airline into bankruptcy.
The rank-and-file members of the Association of Professional Flight Attendants initially rejected the cost-cutting six-year pact Tuesday by a 51 to 49 percent margin, then the next day approved the pact by a 53-47 percent vote at the strong urging of union leadership. But both votes took place before the compensation packages for management were widely known. The union leadership said compensation plans for American's best paid executives were "morally bankrupt" and demanded another vote of members.
American Airlines, the world's largest airline, faces a new bankruptcy threat due to union outcry over its executive compensation plans.
"This taints the agreement that was ratified just two days ago in a wrenching process for our members," said a letter from APFA President John Ward late Friday night. "Every APFA member - those who voted for the agreement and those who voted against it - are outraged by this action, as am I."
American Airlines had said that it needed the concession contracts with the flight attendants and the other two unions approved by this past Wednesday at the latest or it would be forced to immediately file for bankruptcy court protections. Its spokesmen would not take questions on the APFA threat of holding a new vote.
"American has a valid ratified agreement with the APFA," was the only statement from American spokesman Gus Whitcomb.
There was no immediate word from two other unions - the Allied Pilots Association and the Transport Workers Union, which represents most American ground workers - on their plans to go forward with more than $600 million each in annual wage concessions approved this past Tuesday.....