Powered by the largest news staff in Northeastern Oklahoma
Visit tulsaworld.com for coverage of news, business, sports and entertainment.
American Airlines union workers protest executive bonuses
by: D.R. STEWART World Staff Writer
Wednesday, April 20, 2011
4/20/2011 4:40:46 AM
As AMR Corp. prepares to report first-quarter earnings Wednesday, the company’s unionized flight attendants and mechanics are launching protests against “executive greed” and “managerial incompetence.”
American Airlines’ 18,000-member Association of Professional Flight Attendants said they are picketing and protesting executive bonuses at 10 of the nation’s largest airports.
Parent company AMR is expected to award stock-based bonuses to its top managers in conjunction with its quarterly earnings report, officials said.
Members of American’s Transport Workers Union said they will be speaking with airline passengers in May about how American’s baggage and other ancillary fees are not benefiting front-line workers, only management.
“We want passengers to know that when they pay additional fees to check a bag, that money isn’t being seen in the paychecks of baggage handlers, mechanics or other front-line workers,” said Sidney Jimenez, president of TWU Local 568 in Miami, Fla. “However, the top executives are awarding themselves bonuses year after year.”
Flight attendants and mechanics have been working without a new contract since 2008. They gave up 30 percent in wages and benefits in 2003 to help American avert a bankruptcy filing.
APFA on Tuesday issued a 14-count “indictment” alleging the company’s top five executives were guilty of “repeatedly plundering American’s finances to grant themselves multimillion-dollar bonuses while the airline records another year of dismal earnings.”
Beginning Wednesday, the flight attendants are holding informational picketing demonstrations at many of the nation’s major hub airports – not including Tulsa International Airport – to highlight the disparity between cuts in flight attendant pay and benefits and the bonuses executives continue to enjoy.
American spokeswoman Susan Gordon said the company’s executive compensation plan directly links pay to the company’s performance and places a significant portion of management compensation at risk.
“The value of any shares granted under the Performance Share Plan won’t be known until they vest, but it’s expected this year’s plan will pay out significantly below the value originally targeted by the AMR board,” Gordon said. “The decline in value of these shares demonstrates the downside of at-risk compensation and serves as an illustration of our compensation philosophy that tightly links pay to company performance and shareholder interest.”
In 2010, AMR reported a net loss of $471 million, or $1.41 per share, as nearly every other U.S. airline posted net earnings.
Fort Worth-based AMR is expected to award millions of dollars in stock-based compensation to the company’s top executives for the sixth straight year despite company losses of more than $4 billion during the same period, APFA officials said.
“With only a few notorious exceptions, no executives of other major U.S. corporations have taken so much in compensation and delivered so little,” said APFA President Laura Glading. “It’s pay for no performance. To continue enriching themselves in the face of all the sacrifices our members are making is morally bankrupt.”
American executives declined to comment on any of the “14 counts” of APFA’s “indictment.”
Among the allegations is that company negotiators refuse to bargain in good faith toward a new contract.
“By engaging in more than 800 negotiation sessions covering 50,000 employees over five years and only achieving an agreement covering 100 of these workers, the executives have made a mockery and farce of the collective bargaining process,” APFA said in its “indictment.”
“Over the course of three years and 125 bargaining sessions, the executives through their representatives have infused the APFA-American negotiations with bad faith and dishonesty. They have reneged on previously agreed-to contractual changes and misrepresented the value of proposals.”
American’s Gordon said the company is trying to balance the interests of multiple constituencies.
“We remain committed to working with the APFA to reach agreements addressing the needs of both parties and that are in the long-term best interests of the company and all of its employees,” Gordon said.
Patrick Hancock, APFA’s national strike administrator, said the flight attendants hope to strike a chord with a public becoming ever more aware of corporate greed and abuse.
“Management is getting neither more sensitive nor sensible,” Hancock said. “In negotiations, we keep making incremental progress, but at this rate our grandchildren won’t have a contract.
“We want management compensation linked to performance, and it clearly is not. We want management performance to be better. We want the company to be well-run, profitable and to pay employees a decent wage.”
Jimenez, the TWU president in Miami, said mechanics and related workers were “duped” by management in 2003 into thinking they were working in partnership to turn the company around from the brink of bankruptcy.
“We’re not trying to become millionaires,” Jimenez said. “There were certain things said, certain promises made” in 2003. “We want to share the gains with the pain. So far, it has all been pain, and there has not been any gains shared with us.”
Original Print Headline: AA workers protest exec bonuses
D.R. Stewart 918-581-8451
don.stewart@tulsaworld.com