Faces of the American Airlines bankruptcy

February 22, 2012

Charles Grand reports from Dallas on a labor movement battle at American Airlines.

NEARLY 400 flight attendants, ground workers, pilots, retirees and supporters picketed at American Airlines' terminal at the Dallas-Fort Worth International Airport on Valentine's Day. The picket was called in response to the company's demand for union concessions as part of its bankruptcy reorganization.

"For the last few years, management has been taking huge bonuses while the company was in the red," said flight attendant Ramiro De La Garza. "They just don't seem to care."

Hundreds of picketers held signs reading "Execs bank millions while employees scrounge for pennies" and "Employee concessions + passenger fees = executive bonuses" to express their disgust. The focus of the demonstration was on the compensation gap between, as one protester put it, "the top 1 percent of the company and the rest of us."

The airport was a fitting location because it is American Airlines' largest hub and only a few miles from its corporate headquarters. Even as the company has sliced compensation for union workers, American Airlines has showered its executives with bonuses and stock options that total more than $300 million since 2003.

Union members at American Airlines picket outside the Dallas-Fort Worth airport
Union members at American Airlines picket outside the Dallas-Fort Worth airport

Beverly, a 20-year veteran of American Airlines, said she hoped the demonstration would "put a face to the bankruptcy. We've given up so much for years. What they're asking us to give up now is tremendous. Gas and food prices keep going up, but our wages haven't gone up in 10 years. Our retirees even stand to lose some of their medical benefits."

With the economy still reeling, it's not out of the ordinary for companies to go bust and then file for bankruptcy in order to restructure. But at the time of American Airlines' bankruptcy, it was sitting on $4 billion in cash.

A company statement released last year stated that it was trying to "achieve a cost and debt structure that is industry competitive and thereby assure its long-term viability." Translation: We're going to use the economic crisis to justify making cuts and rewriting our labor contracts in order to wring concessions from workers.

ON FEBRUARY 1, the company's CEO announced the airline would be laying off 13,000 people as well as restructuring health and pension benefits. Half the cuts would be leveled against maintenance workers, mechanics and ground workers. Their jobs would be outsourced because American Airlines plans to service more and more of its jets abroad, where labor costs are lower. Another group of workers on the chopping block is the flight attendants.

Negotiations are underway between management and the Association of Professional Flight Attendants (APFA) and the Transport Workers Union (TWU). If they can't reach a settlement on the company's new demands by February 25, the matter will be up to a bankruptcy court judge in New York.

APFA and TWU workers claim that upper-level mismanagement is largely responsible for the airline's financial situation, and that the company's reorganization will disproportionately harm tens of thousands of workers and their families.

The Valentine's Day demonstration is one of many expressions of simmering anger among American workers. Even management is starting to get the hint. One flight attendant told a story about how two corporate vice presidents were on his flight a week ago. It was a 12-hour redeye flight from Brazil back to the U.S. "I swear, neither of them got so much as a cup of water from us," he said. "For 12 hours, they didn't eat or drink. I think they were afraid that we'd mess with them or something."

While American Airlines may not get every concession it has demanded from workers, the layoffs and restructuring of benefits will cut deeply into the living standards of working families. The bitterness that made itself visible on Valentine's Day will not go away. In fact, the degree of support that actions like this are garnering from the broader public can only give more confidence to workers wanting to resist corporate attacks.

Don't be surprised if this isn't the last you hear about American Airlines flight attendants and ground crew workers this year.

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