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US Airways Merger with AMR Remains on Front Burner

"We still have revenue and network gaps with Delta (DAL - Get Report) and United (UAL - Get Report)," he said. A merger with US Airways could provide American with the critical mass to compete.

American's other labor unions also remain committed to a merger, for which Laura Glading, president of the Association of Professional Flight Attendants, has emerged as a key advocate.

In a recent note, consulting firm Leading Edge said American pilots last month rejected a tentative contract deal by a 62%-38% margin partially because they felt that "rejecting the last best final offer was the best path to the US Airways merger.

"Although mergers, with the contentious process of integrating seniority lists, are usually anathema to pilots, APA pilots are overwhelmingly in favor of a merger with US Airways" Leading Edge said. The tentative contract agreement with US Airways "is superior by orders of magnitude for the pilot group, offering a voluntary limit to a modest amount of code sharing and the promise of real compensation parity, to include profit sharing and retirement as well as wages, with industry leaders."

While it is clear that US Airways has suffered from an inability to merge pilot seniority lists following a 2005 merger with America West, it is possible to conclude that a proposed decision , unveiled Tuesday by a U.S. District Court Judge in Phoenix, defines a path to resolve the dispute. That decision would tentatively enable US Airways to negotiate a joint contract with its pilots, after which pilots who felt disadvantaged by that contract's seniority provisions would have the right to sue.

-- Written by Ted Reed in Charlotte, N.C.

>To contact the writer of this article, click here: Ted Reed
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