In a letter to the paper published last week, President Little said,
In a letter to the paper published last week, President Little said,The premise of your editorial “The AMR Union Warning” (Dec. 1) about AMR’s bankruptcy filing—that workers and unions are unwilling to address changing circumstances—is simply false.
In 2003, responding to industry challenges following 9/11, members of our union and other workers at American Airlines and American Eagle agreed to reduce our compensation by billions of dollars. These concessions, we reasoned, would help management put the business on a sustainable path.
We Transport Workers Union of America members lived up to our end of the bargain, actually boosting AMR’s bottom line by bringing in substantial new business due to the quality of our repair and maintenance work. But management failed to execute. It didn’t upgrade the fleet, missed merger opportunities and lost money year after year. While our members were living with reduced incomes, management rewarded its losing strategy by taking hundreds of millions in executive bonuses. Now it’s declared bankruptcy, while sitting on a $4 billion cash hoard.
If you’re wondering why people are fed up with Wall Street, it might be because we’re tired of seeing wealthy elites blame ordinary citizens for all the world’s financial problems. And we’re mad as hell that no matter what the problem, a reduced standard of living for the middle class is always offered as the solution.
James C. Little
International President
TWUA
Smoke and mirrors will not fool TWU members, and we will fight to make sure we aren’t forced to carry the entire burden of the excesses of the 1%.
TWU has retained the best bankruptcy counsel and economists available. The biggest problem TWU members face is the bankruptcy system itself. Airlines love Chapter 11 of the bankruptcy code because under the Railway Labor Act, employers have an obligation to maintain the “status quo” until they reach agreement, but Chapter 11 essentially gives them an opportunity that the RLA doesn’t—to reject the existing contract and implement new contract terms after a short period of good faith bargaining, as long as the court approves. Even though Congress tried back in the 1980s to protect workers by saying in the statue that contract modifications under bankruptcy have to be “necessary,” in New York, where AMR filed its bankruptcy petition, the federal court of appeals has defined that seemingly clear word quite broadly in favor of employers. What’s more, in a 2007 decision involving Northwest and AFA-CWA flight attendants, that same court held that workers covered by RLA could be stopped from striking after they voted to reject a tentative agreement, even though they rejected the agreement after the bankruptcy court had permitted management to reject the contract and impose new “interim” terms, which is not permitted under the RLA. Effectively, the appeals court found that even though management could use bankruptcy to short-circuit the RLA dispute resolution process, the workers still had to go through that lengthy process.
This is one of the reasons bankruptcy has become an accepted management strategy among struggling but still solvent legacy carriers, instead of a last resort accepted with a sense off shame by the rare carrier that has no other recourse.