AA transport union to vote again; Carty apologizes about undisclosed perks

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AA transport union to vote again; Carty apologizes about undisclosed perks

FORT WORTH, Texas (AP) =97 A second major union at American Airlines said=20
Monday its members would vote again on a pay-cut package designed to keep=20
the carrier from bankruptcy. The decision by the transport workers union=20
came in response to an executive bonus and pension plan that has riled=20
labor relations at the beleaguered airline. American's chairman and chief=20
executive, Donald J. Carty, repeated his apologies from last week about the=
=20
perks, which were revealed after the airline's three main unions agreed to=
=20
$1.8 billion in annual concessions. ``I made a mistake, and of course it=20
was a big one," Carty said at a news conference. The transport workers=20
union said late Monday on its Web site that it would have a new vote. Late=
=20
Friday, the Association of Professional Flight Attendants announced that=20
its members would reconsider their $340 million share of the wage and=20
benefit cuts American has said it needs to avoid bankruptcy.

The labor unrest prompted investors to sell shares of AMR, American=20
Airlines' parent, down 23 percent Monday on the New York Stock Exchange.=20
AMR shares fell $1.15 to close at $3.85. The shares jumped 52 percent last=
=20
week, as American edged back from the brink of bankruptcy. Some experts in=
=20
labor law said the union could have valid cause for conducting a new=20
election because the company did not disclose bonuses and payments to a=20
pension trust for top executives while it negotiated with unions for pay=20
and benefit cuts. The bonuses were rescinded, but the company won't try to=
=20
recover the undisclosed amount it paid to fund the pensions for 45 top=20
executives. A spokesman for the flight attendants union said members were=20
just as upset Monday as they were when they learned of the executive perks=
=20
late last week. ``The fact that we're re-balloting has really helped," said=
=20
the union spokesman, George Price. ``They did feel as though they were=20
duped by the company, and now they feel they can make a fully informed=20
decision."

The union at first rejected the concessions but reversed itself after=20
voting was extended by a day, which the union blamed on technological=20
glitches in the voting process. In the end, 52.7 percent of flight=20
attendants who voted approved the concessions, fearing that bankruptcy=20
would lead to even deeper wage and benefit cuts. In public, American has=20
acted as if the flight attendants' election is settled in the airline's=20
favor. Company officials say they have a ratified contract with the union=20
that takes effect May 1 and have declined further comment on the subject.=20
Some labor-law experts, however, say the unions could have legal grounds to=
=20
challenge the election. Charles Craver, a professor of labor law at The=20
George Washington University, said unions have wide latitude in conducting=
=20
ratification votes. He added that the company could be guilty of bargaining=
=20
in bad faith if union negotiators asked about executive compensation and=20
were not told of the bonuses and pension payments. David L. Gregory, a=20
labor-law professor at St. John's University, said American could be guilty=
=20
of bad-faith bargaining by threatening unions with bankruptcy unless they=20
approved concessions. He added that American might have interfered in the=20
flight attendants' voting by contacting union members on the last day =97 a=
=20
complaint raised by the union. ``There is a very solid basis for this vote=
=20
to be challenged," Gregory said.

Even if American's actions were legal, the scholars said, they put the=20
company in a bad light just when it appeared to have avoided bankruptcy.=20
``The American executives have put their entire corporation at risk,"=20
Craver said. Before the AMR board's decision in October, executive pensions=
=20
were paid out of company general funds and would have been unsecured in=20
bankruptcy, said Bruce Hicks, the American spokesman. Hicks said the=20
company was not considering rescinding the pension payments, which were=20
made to protect the benefits in case the airline filed for bankruptcy, as=20
are the pensions of other employees. AMR also won't ask executives to=20
return money from a trust. Fort Worth-based AMR is scheduled to report=20
first-quarter earnings Wednesday, and analysts predict it will post an $800=
=20
million loss.



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