American faces pilots' walk-out
Friday 17 January 1997
American's 9,300 pilots, whose union is the Allied Pilots Association, this week ignored a company-imposed deadline to accept outside arbitration in a wage dispute that has been dragging on for more than two years. The two sides have now entered a government-required, one-month cooling-off period.
The pilots, who are rejecting a four-year, 5 per cent pay rise offer by American, will be free to walk out on 15 February if no deal is reached before then. Such action would undoubtedly ground the airline.
American contends that giving in to union demands for more generous pay increases would put it at a disadvantage against rival carriers such as United Airlines and Delta Airlines, where wages have been scaled down.
"This is as grave a situation as I've seen the company face in my career here," said Gerard Arpey, the airline's chief financial officer. "We are at a loss what to do next; accept a contract that would be at best uncompetitive, or a possible cessation of operations."
The crisis hit the airline just as its parent company, AMR, announced record fourth-quarter earnings. Net income for the company in the fourth quarter of last year reached $284m (pounds 170m) while 1996 came out as its best year on record, with earnings topping $1bn.
A strike and grounding at the airline would cast a pall over the proposed matrimony with British Airways. Last week BA and American entered the final stages of preparation for the pact by submitting formal requests with US regulators for anti-trust exemptions.
The turmoil also threatens to scuttle American's contract with Boeing for the purchase of no less than 103 new jets in an order worth $6.5bn.
With no sign that they are willing to back down, the leaders of the pilots' union seem to have been stiffened by AMR's record profits.
Union spokesman Wally Pitts said: "Our wage requests are reasonable. All we want is a cost-of-living increase.''
- 3 Alton Towers crash: Four seriously injured and 16 guests trapped as Smiler ride carriages collide
- 4 Ann Summers survey reveals the UK's favourite sex position
Man on naked bike ride gets ejected after becoming aroused
Caitlyn Jenner's mother Ester thought her daughter, formerly known as Bruce Jenner, had transitioned for money
Charles Kennedy 1959-2015: A gifted, compassionate politician whose career was cut short by the 'demon drink' - latest news
Alton Towers crash: Four seriously injured and 16 guests trapped as Smiler ride carriages collide
Charles Kennedy dead: A guy once asked the Lib Dem leader who his favourite Muppet was and his letter response was wonderful
Thousands of teenage girls enduring debilitating illnesses after routine school cancer vaccination
Migrants in Kos: Photos show real tragedy after Brits abroad complain of 'awkward' holidays
British tourists complain that impoverished boat migrants are making holidays 'awkward' in Kos
Michael Gove determined to scrap the Human Rights Act – even if Scotland retains it
Threat to scrap Human Rights Act could see UK follow Nazi example, warns UN official
Church of England 'one generation away from extinction' after dramatic loss of followers
iJobs Money & Business
£30000 - £35000 per annum: Recruitment Genius: The UK's fastest growing, multi...
£70000 - £90000 per annum: Recruitment Genius: A Financial Reporting Manager i...
£23000 - £25000 per annum: Recruitment Genius: They win lots of awards for the...
£13500 - £20000 per annum: Recruitment Genius: This nationwide enforcement com...