American Airlines Bankruptcy Let Downs
It was bound to happen sooner or later; customers would suffer at the hands of the American Airlines bankruptcy case. Over the weekend, many flights were cancelled or delayed as the result of, what some are saying, a staged “sickout”.
After heated negotiations between American and the pilots unions in recent weeks, the federal bankruptcy judge ruled to allow American to modify pension contracts. Section 1113 of the bankruptcy code allowed for American Airline officials to impose its own contract terms after the union rejected their last offer to modify existing contracts. It is no secret that pilot union members are disappointed by the big changes to their employment contracts, but did they really organize an illegal protest to fight back?
Representatives from the union deny that any of the weekend’s flight cancellations or delays are attributable to employee actions. Despite the fact that the rate of no-shows has risen by over 20% recently, there was also a significant number of maintenance write-ups over the weekend. These maintenance requests are required “to be addressed before takeoff”, as reported by American in an email sent to its frequent fliers.
The flight delays and cancellations are just another hurdle American Airlines will face as they move forward in their debt restructuring efforts. However, American had some success this week when nearly half of the 1500 maintenance workers offered incentives to leave their positions accepted. Another court hearing could to further negotiations with pilots could be held as early as next week.