American presents revised terms to pilots

Washington DC
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American Airlines has presented a revised term sheet to its pilots union and plans to file it with the bankruptcy court today.

The Fort Worth, Texas-based Oneworld carrier is understood to have revised the sections on codeshares and furloughs, which US Bankruptcy Court for the Southern District of New York judge Sean Lane rejected on 15 August, with the terms from its last, best and final offer to the Allied Pilots Association (APA) in June.

The pilots rejected the contract by an 11-percentage point margin, with 61% voting against, on 8 August.

"We've addressed [codesharing and furloughs] in the revision to the term sheet we presented to the APA," says American. "[We] plan on renewing our 1113 motion with the Court [on 17 August]."

The final offer allowed American to enter into unlimited domestic codeshare agreements with Alaska Airlines, Hawaiian Airlines and other carriers with a few exceptions. Routes between Hawaii and Chicago O'Hare, Dallas-Fort Worth, Los Angeles and San Diego would be excluded from a partnership with Alaska, and the Hawaiian agreement would only cover intra-island flights.

New domestic codeshare agreements could also not exceed more than 50% of American's domestic available seat miles during any 12-month period.

The agreement contained little on furloughs, which likely remained comparable to the existing language in the carrier's contract with its pilots. American can furlough up to 2,000 pilots under its existing agreement and has a force majeure clause allowing for additional furloughs in the case of unexpected events.

The APA did not comment on the revised terms. Keith Wilson, president of the union, said in a letter to members on 15 August: "Your APA leadership is committed to securing a consensual, industry-standard contract that respects your sacrifices and recognises your true worth as professionals."

Separately, American's unsecured creditors committee endorsed the revised term sheet, which includes previously negotiated equity stakes for the carrier's pilots, it says in a statement on 16 August.