October 1, 2011 saw 129 pilots retire from American Airlines, an increase over the already high 111 retirees from the prior month. The number of recent retirees is now significant enough that it has the potential to impact the operations of the airline, preventing them from flying their schedule.
The retirees are apparently are still concerned about the long-term financial viability of the company and chose to get out while they could still maintain the 60-day back-dating option on share price for their retirement package. Given the news yesterday of impending bankruptcy for the company the move by the pilots doesn’t seem all that far-reaching.
The efforts to mitigate the impact bring a whole new collection of issues to the forefront related to the negotiations between the union and the airline. The airline has reduced some long-haul flying and altered the schedule to require fewer pilots. They have also proposed a "relief plan" to the union, though it is not clear that the pilots are interested in accepting that offer.
It should also be noted that the number of retirees is not, at the absolute level, a disaster for the company. There are many others available and many on furlough who can be brought back to help cover the issue. But there is a notable time requirement for the training to get them back on board which will prevent things from running seamlessly.
Lots of fun to be had down in Fort Worth these days.
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