A US District Court Judge in Dallas, Texas has issued a temporary restraining order against American Airlines pilots who began a job action February 6 that has forced the cancellation of more than 2,000 flights of the second largest US air carrier. Judge Joe Kendall issued the order after a four-hour hearing February 10. He instructed the pilots' union to show him copies of any messages sent to pilots ordering them to return to work.
The same day American Airlines cancelled some 900 flights due to the job action. The previous day 1,300 pilots called in sick, forcing the cancellation of more than 800 flights, 36 percent of the daily total.
Federal law severely limits the right of airline employees to strike. Negotiations between the Allied Pilots Association, bargaining agent for American's 9,200 pilots, and management continued and then broke off February 10 after resuming the previous day.
At issue is American's acquisition last December of Reno Airlines, a low-cost regional carrier. Top pay for Reno pilots averages less than one-half the current top scale at American. The union is insisting that Reno pilots be integrated retroactively to December 23, the merger date, into the pilot seniority list according to terms of the "Scope Clause" in the existing union contract.
The pilots' contract prohibits management from owning or controlling another airline and operating it with pilots not on the American seniority list. To comply, American would have to operate Reno Air with APA-represented pilots. This would require an immediate pay increase for the 300 Reno pilots and would result in promotions and pay raises for about 2,000 American pilots, who would be bumped up in seniority since APA is proposing that Reno pilots be put at the bottom of the seniority list. Management has proposed that the integration process be stretched over one year or more. It has claimed that it cannot afford the pay raises being demanded by pilots.
American, whose parent company AMR Corporation posted record profits of $1.3 billion in 1998, is engaged in a concerted drive to cut costs in order to better compete with other carriers. Its recent acquisition of Reno is seen as an attempt to establish a "low-cost carrier within a carrier." Pilots fear that American intends to use lower paid Reno pilots to fly new routes, displacing better paid workers. It could set a precedent in the event of a merger with a larger airline such as Alaska Air or US Air.
One of the major issues in the strike by Northwest Airlines pilots last September was the demand by management to expand the use of crews from its lower paid regional carriers, eliminating the jobs of more highly paid pilots. In recent years all the major airlines have established low-cost subsidiaries in an attempt to undermine pay and working conditions.
American pilots resent the reimposition of an arrangement that amounts to a two-tier wage scale. The pilots were the first to have a two-tier pay scale forced upon them in the early 1980s, a practice that has since spread throughout the industry. In 1992 American furloughed 610 pilots and ceded many of its West Coast routes to the low-cost start-up airlines Reno and Midway. The new carriers served as "alter egos" to American, which helped to subsidize them in a variety of ways.
In February 1997 President Bill Clinton intervened to abort a strike by American pilots. A subsequent settlement was dictated by a panel appointed by Clinton.
The sick-out began on February 6, apparently sparked by a suggestion from APA officials that pilots refuse to work overtime. A number of press reports have termed it a "wildcat strike." APA has not sanctioned the job action. One union spokesman called it "a fire burning down at the grass roots level."
The impact of the sick-out has been greatest at airports in American hub cities such as Chicago, Dallas, Texas and New York. It is also heavily impacting on tourist travel to the Caribbean, where American is a major carrier. An analyst at Saloman Smith and Barney in New York estimated the job action has cost American $19 million so far.