Remember This?
American Airlines Defends Smaller Management Pay Cuts
Unions Have Until Mid-Month To Approve Plans
POSTED: 9:26 p.m. CST April 3, 2003
UPDATED: 10:39 p.m. CST April 3, 2003
FORT WORTH, Texas -- American Airlines officials are defending job and
salary cuts for executives that are less severe than those faced by pilots,
flight attendants and mechanics.
About $100 million would be trimmed from management costs by eliminating 5
percent of the 12,000 jobs and slashing salaries by 4 percent to 15 percent
under the plan.
A company spokesman defended the more modest cuts for management employees,
noting that they have gone without raises and bonuses for the past two
years.
Pay for American's management employees lagged industry averages while the
company's flight attendants and ground workers have been at the top of
industry pay scales and pilots have been near the top, said spokesman Bruce
Hicks.
"We have always kept at the industry average, very lean and very efficient
... but this puts management even further below average," Hicks said
Thursday.
The Fort Worth-based airline has already reduced management by 22 percent
since the Sept. 2001 terrorist attacks, he said.
The first $30,000 of their salaries will be reduced by 4 percent, the next
$30,000 by 7 percent, the next $30,000 by 10 percent and for amounts over
$90,000, 13.5 percent. Chairman Donald J. Carty said this week he would take
a 33 percent cut from his $585,813 salary, and officers' pay would be cut 17
percent.
American and its three major unions reached tentative agreements Monday on
deals to cut more than $1.6 billion in annual labor costs, the bulk of an
estimated $1.8 billion reduction in overall labor spending. Airline
officials said they would have to file for bankruptcy without the deals.
Union officials defended the deals, warning of even deeper pay cuts and more
layoffs if American went into bankruptcy.
Under the tentative agreements, about 2,500 pilots, 2,400 flight attendants
and 1,100 to 1,400 ground workers likely will lose their jobs. Remaining
employees will work longer hours and get less vacation.
As devastating as the cuts are, the airline has said it would lay off a
total of 3,900 flight attendants -- 1,500 more than what is proposed in the
concessions plan -- if it files for bankruptcy, said Association of
Professional Flight Attendants spokesman George Price.
In that case, the company has said it would use Latin American flight
attendants who are paid much less than their U.S. counterparts, Price said.
"That means we could lose American jobs to foreign nationals," he said.
American Airlines Defends Smaller Management Pay Cuts
Unions Have Until Mid-Month To Approve Plans
POSTED: 9:26 p.m. CST April 3, 2003
UPDATED: 10:39 p.m. CST April 3, 2003
FORT WORTH, Texas -- American Airlines officials are defending job and
salary cuts for executives that are less severe than those faced by pilots,
flight attendants and mechanics.
About $100 million would be trimmed from management costs by eliminating 5
percent of the 12,000 jobs and slashing salaries by 4 percent to 15 percent
under the plan.
A company spokesman defended the more modest cuts for management employees,
noting that they have gone without raises and bonuses for the past two
years.
Pay for American's management employees lagged industry averages while the
company's flight attendants and ground workers have been at the top of
industry pay scales and pilots have been near the top, said spokesman Bruce
Hicks.
"We have always kept at the industry average, very lean and very efficient
... but this puts management even further below average," Hicks said
Thursday.
The Fort Worth-based airline has already reduced management by 22 percent
since the Sept. 2001 terrorist attacks, he said.
The first $30,000 of their salaries will be reduced by 4 percent, the next
$30,000 by 7 percent, the next $30,000 by 10 percent and for amounts over
$90,000, 13.5 percent. Chairman Donald J. Carty said this week he would take
a 33 percent cut from his $585,813 salary, and officers' pay would be cut 17
percent.
American and its three major unions reached tentative agreements Monday on
deals to cut more than $1.6 billion in annual labor costs, the bulk of an
estimated $1.8 billion reduction in overall labor spending. Airline
officials said they would have to file for bankruptcy without the deals.
Union officials defended the deals, warning of even deeper pay cuts and more
layoffs if American went into bankruptcy.
Under the tentative agreements, about 2,500 pilots, 2,400 flight attendants
and 1,100 to 1,400 ground workers likely will lose their jobs. Remaining
employees will work longer hours and get less vacation.
As devastating as the cuts are, the airline has said it would lay off a
total of 3,900 flight attendants -- 1,500 more than what is proposed in the
concessions plan -- if it files for bankruptcy, said Association of
Professional Flight Attendants spokesman George Price.
In that case, the company has said it would use Latin American flight
attendants who are paid much less than their U.S. counterparts, Price said.
"That means we could lose American jobs to foreign nationals," he said.
