But Two Unions Have Now Scheduled Concession Re-Votes

The Transport Workers Union (TWU) Monday joined the Association of Professional Flight Attendants (APFA) in threatening a re-vote on their agreement to huge concessions aimed at keeping the world's largest carrier out of bankruptcy. The company's stock slid as investors, who had been buying on the belief that American had sidestepped bankruptcy, faced their fears all over again. And The Donald Monday said he was sorry.

"Our union leaders stepped up to the plate quickly by hammering out consensual agreements.
Our unionized employees stepped up to the plate by ratifying them. Indeed, all of our employees, union and non-union alike, did what was necessary to help avoid bankruptcy," said Carty at a Fort Worth news conference. "And then I stumbled. You know, the world's largest airline doesn't do anything halfway. When we do something, we do it bigger and we do it better than anyone else. Together, we had done what no one has ever done before, that many thought couldn't be done. We delivered the largest consensual savings in US history. And then I made a mistake. And of course, it was a big one."

Carty's Apology

Carty said he failed to communicate fully with union leaders about double-your-salary retention bonuses for the company's top seven executives - himself included. But he stopped short of canceling $41 million in supplemental bonuses for the company's top 45 managers. He also stopped short of resigning.

"I hope my apologies, my cancellation of all retention payments and my commitment to be completely open about these matters now and, I might add, in the future, can begin to build a bridge back to the path that allowed us to forge these historic agreements in the first place - a path that promised a new culture of collaberation, cooperation and trust," said Carty at Monday's news conference.

"Now, it is obvious to me, as I'm sure it is to all of you, that that won't happen overnight. But I am committed and the management team at American and the board at American are committed to gaining our employees' confidence - a valuable commodity that has to be earned, and then re-earned every single day. Now, an important building block back to that bridge of trust and confidence is for our union leaders and our employees to have full confidence in the fact the sacrifices they were asked for and agreed to make were indeed shared, and that we are, in fact, all in this together. So I hope my record in this regard speaks a lot more clearly than I obviously have, about the full details."

The Unions' Response

"We intend to revote despite the apology," said George Price, a spokesman for the APFA. The TWU said Monday American is in material breach of the company's obligation to provide all relevant facts during a negotiation. The board of the Allied Pilots Association met Monday to discuss "options," but there was no word on the results of that conference.

But Carty told Monday's news conference that any further delay in enacting the already-approved union concessions would cause American Airlines to go bankrupt. Can the unions just say no to Carty, in light of Friday's financial revelations?

"I think if you want to get technical, legally we're up in the air. We're trying to stay away from that . . . and we're trying to get back with our unions," Carty said. "We can't lose sight of the important objective here: How do we save our company from bankruptcy?"

In other words, The Donald, as he's known among employees, is in trouble. His apology may have been heartfelt, but it appeared late Monday to be less than enough to stave off a union-driven cave in on concessions. American's lawyers are in the bullpen just in case, warming up for a date in federal bankruptcy court they thought they had dodged.

FMI: www.aa.com, www.alliedpilots.org, www.apfa.org, www.twu.com