New Votes May Take a Month
American Airlines' pilots won't have another vote
on the wage concessions they've OK'd, but the union's board has
told the union's president not to sign the agreement.
Quite aside from the problems that may cause, the two other
major unions, flight attendants and ground workers, are planning on
having another look at their concession contracts; a re-vote may
take a month.
The unions' last votes were accelerated, because
AMR Corp, the parent company, said the concessions were needed
immediately, to help the airline avoid bankruptcy.
'Coincidentally,' the votes were tallied just hours before the
company's SEC filings revealed previously-unknown executive
What followed has been written to death on this page, and many
others: the unions cried, "foul;" the airline pointed out that
union leaders knew of the perqs (but were prohibited from
discussing them, under a nondisclosure agreement -- they
nevertheless recommended passage of the concessions); then the
unions denied that their leaders had any such foreknowledge, and
CEO Don Carty agreed [perhaps by saying he wasn't telling the truth
the first time, he saved the union leaders' collective bacon, and
can expect some cooperation from the bosses --ed]. Then, two unions
put aside the vote results, saying that 'material information' had
been withheld; the airline reiterated that everything it did was
OK -- got
that? Now, it's mid-week, a week later. Two unions (not the pilots)
are planning on having another vote. Because now there's no "rush,"
voting will take place the old-fashioned way: with mail-in ballots.
In a month or so, when the votes are tallied, the airline should be
in Chapter 11. [Since the "rush" vote was necessary to avoid
bankruptcy, any delay would mandate a trip to Court, right?] Once
in Chapter 11, as United has already demonstrated, the existing
contracts (with or without the concessions package) can be set
aside by the judge, if the airline and its creditors can make a
strong-enough case. Therefore, the results of any future re-vote
will be largely irrelevant -- merely an indicator of sentiment,
rather than a contract; and the unions' sentiment is already pretty
If American Airlines goes into Chapter 11, it will be
better-able to compete with United and other airlines, since its
prepetition debt will be "on hold."
added 'competitiveness' may spell doom for other, responsible
airlines -- airlines that are paying their creditors; and it will
certainly have huge effects on all of American's creditors, and,
because of American's size, the creditors' industries. In other
words, by temporarily 'saving' the tens of thousands of American
Airlines jobs, the bankruptcy code may force hundreds of
thousands of workers, from well-managed businesses, to the
The very structure of the US airline industry will change.
Hopefully, the bankruptcy code will be revised, to reflect a better
plan for delinquent and dead-beat companies, that won't penalize
the well-run, honest companies -- suppliers and competitors --
whose management was better.