US Airways reaches labor agreement…with American Airlines’ unions


US Airways has filed an 8-K statement with the US Securities and Exchange Commission indicating that they have reached agreements with the three major unions of American Airlines regarding collective bargaining terms should a merger of the two carriers be consummated. Despite many reports in the media this is not an indication that a merger has happened or even that it is imminent, but it is a very significant step in securing buy-in from the employees should a merger move forward.

From a message from CEO Doug Parker to the US Airways employees:

First of all, today’s news does not mean we have agreed to merge with American Airlines. It only means we have reached agreements with these three unions on what their collective bargaining agreements would look like after a merger, and that they would like to work with us to make a merger a reality. To get to an actual merger, many more things must happen including gaining the support of AMR’s creditors, its management team and its Board of Directors. But this is obviously an important first step along that path and we are hopeful we can all work together to make this happen.

Most importantly, in American’s standalone strategy, over 13,000 employees at American will lose their jobs. Our merger contemplates saving at least 6,200 of these positions. For the US Airways team, the agreements we have reached with the unions representing employees at American would also provide enhancements to the compensation and benefits currently in place here.

It is no surprise that the unions will jump at the chance to lose fewer jobs. It is somewhat surprising that they see the labor situation at US Airways as encouraging for the future of the company, particularly given the current state of the east/west divide that the company still has. But this is definitely an interesting development.

Next up, US Airways management has to convince the AMR creditors that the merger is in their best interests. The unions hold three of the nine seats on the creditor panel so this is a big step in that direction. More news as it develops…

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Seth Miller

I'm Seth, also known as the Wandering Aramean. I was bit by the travel bug 30 years ago and there's no sign of a cure. I fly ~200,000 miles annually; these are my stories. You can connect with me on Twitter, Facebook, and LinkedIn.

6 Comments

  1. I am sticking to my bet I made with myself on day one that the BK will end up with AA being subsumed by another carrier. The US Air option suddenly looking that much more likely

  2. I keep hearing rumblings that BA might want in on the deal. It would probably be a matter of BA buying a stake in US, the proceeds of which would then be used to acquire AMR.

    1. BA (IAG, really) cannot hold a particularly significant stake in any US-based carrier due to foreign ownership restrictions.

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