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March 28, 2014

American Eagle Pilots Reject Concessionary Contract

EULESS, TX—American Eagle pilots, represented by the Air Line Pilots Association, Int’l (ALPA) expressed their collective will and today rejected a concessionary contract proposed by American Airlines Group (AAG). With 92 percent of the eligible pilots casting their ballots, 70 percent voted against ratification of the contract.

“The Eagle pilots made a clear choice today, and it was not an easy one,” said Capt. Bill Sprague, chairman of the Eagle ALPA Master Executive Council. “Despite threats from AAG management that they would seek other express carriers to conduct our flying, today’s vote demonstrates that the demands for contract concessions were not acceptable. Today’s vote clearly shows that pilots can, and will, vote against any agreement that is not in their best interests.”

The proposed contract changes were a combination of pay freezes, reductions in per diem, and increased health-care costs in exchange for a promise to refleet the airline and enhance the existing agreement to transfer pilots to American Airlines. These concessions were in addition to the $43 million the pilots gave the company during bankruptcy last year.

Having previously worked under a 16-year contract that concluded with AMR’s bankruptcy filing, the American Eagle pilots have not seen meaningful contractual gains since 2004. New-hire pilot pay begins at less than $23,000 per year. Had the contract been approved, first officers would have been capped at about $38,000 per year after four years of service.

“Management has said many times to us that this agreement is their ‘bottom line’ offer and believe that they will be able to get the same cost savings from another provider,” Sprague said. “We question whether any regional airline is able to attract and retain pilots by offering poverty-level wages. American Eagle already has a career progression arrangement with American, and yet, due to a lack of pilots, it’s unable to perform the regional flying that American Airlines desires. Other airlines are experiencing the same problem.”

[J.O.]

Now is not a good time to be in the regional airline business south of the border. They're caught in the vice with the FAA's new experience rules on one side and major airlines demanding ever lower and lower costs on the other.