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Bonus Flap Threatens AMR Concessions

Flight attendants threaten a third ballot on a crucial labor pact.
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American Airlines' ability to avoid a bankruptcy filing was again cast in doubt after its flight attendants' union, angered by revelations about bonuses and pension protection for top executives, threatened to hold another ballot on a contract it approved last week.

The union, which previously approved $340 million of wage and labor concessions that the

AMR

(AMR)

unit said was crucial to keeping it out of bankruptcy, said in a statement on its Web site that the new vote would be held soon. It didn't specify when.

AMR appeared to have been spared a chapter 11 filing last week when the 10,000-strong flight attendants union joined pilots and mechanics in agreeing to measures that together will cut $1.8 billion of costs. The flight attendants' approval was itself a second ballot, the first one having rejected the contract.

The latest controversy involves bonuses for seven top executives and pension protection for 45 executives that were approved last year but not disclosed until recently, in an

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filing. Union leaders said the belated disclosure amounted to bad-faith negotiating and justifies the third vote.

An AMR spokesman told the

AP

that the airline "has a valid, ratfied agreement with the

flight attendants' union."

AMR's shares jumped 77 cents, or 18%, to $5 on Friday following the vote to approve the contract.