AMR and US Airways Pilots Seek Joint Contract

CHARLOTTE, N.C. ( TheStreet) -- The president of the union that represents AMR ( B) pilots met Monday with leaders of the US Airways ( B) pilot union, as the two groups began to map out a joint strategy in advance of a hoped-for merger between their two carriers.

Leaders of both unions believe a merger would be beneficial, bringing a better contract at US Airways and a better contract than the one envisioned by AMR, which is seeking to abrogate its existing pilot contract in bankruptcy court.
Gary Hummel, president of USAPA (left) and Dave Bates, president of APA.

"I'm here to build a bridge with our union brothers at USAPA and to coordinate in creating the world's largest and best airline," Dave Bates, president of the Allied Pilots Association, told reporters. APA represents 8,000 pilots, while the U.S. Pilots Association represents about 4,300 US Airways pilots.

"We want to get USAPA to support a merger to create a new American (and) we want to negotiate a joint collective bargaining agreement with US Airways," Bates told reporters. "We want a combined workforce, fully integrated, under one agreement."

Added USAPA President Gary Hummel, "No one is clear how the process will unfold. This meeting was (intended) to start defining that. We are in agreement there is more value in working together towards that end."

At the same time, Hummel said, "My job, even though we are looking forward to a cooperative effort, is to protect USAPA pilots (and) to ensure our pilots get the best contract they can."

It would be rare, if not unprecedented, to have one union, in this case APA, negotiate a contract that covers itself as well as a second union, USAPA. But it is possible that complications could be addressed by having negotiators from both unions participate. Both union leaders seem firmly committed to cooperate.

Because airlines historically become more generous in contract negotiations when they are pursuing a merger, the pilot groups appear to be aligning at a propitious time, at least in terms of seeking agreements with US Airways. A new contract, which US Airways has already offered to American pilots, would take narrowbody captain's pay to $177 an hour, compared with the $143 an hour earned by former America West pilots and $125 earned by pilots at predecessor US Airways. The two carriers merged in 2005.

The issue of seniority integration, always a problem when airlines merge, would be particularly difficult in this one, because a controversial 2007 seniority ruling continues to divide pilots from US Airways and America West.

Bates said seniority integration in a merger between American/US Airways would include temporary "fences" to protect pilots who fly desirable routes from losing them to other, more senior pilots as a result of the merger. In general, he said, seniority integration would be governed by the 2007 McCaskill-Bond statute, which stipulates that seniority integration issues be resolved through negotiations and, if that fails, through binding arbitration with three arbitrators. "We will try to negotiate," Bates said.

He added that he flew to Charlotte from Dallas on a US Airways flight with a crew from the former America West, and he spoke with both pilots. "They're ready to move on" from the seniority battle, he said. Bates and Neil Roghair, APA negotiating committee chairman, met with about 50 USAPA pilots at the USAPA offices in Charlotte.

APA pilots are backing a merger with US Airways, Bates said, because that would create a bigger airline. " Delta ( DAL) and United ( UAL) are formidable competitors," he said. "Part of the problem is that America is losing corporate customers to stronger networks. If we want to compete on that business model, we've got to get bigger."

Last month, APA leaders negotiated a tentative contract with US Airways CEO Doug Parker. AMR management opposes a bankruptcy deal with US Airways and said it would prefer to emerge from bankruptcy on its own. AMR "has not yet approached us," to offer a response to the US Airways deal, but Bates said he believes "they will probably reach out to us." However, he said, current management "has lost the confidence of the pilots."

Hummel agreed that "a merger offers the potential for a resolution" to the lingering seniority dispute. However, he noted, the two sides in the dispute are currently awaiting a ruling by a U.S. District Court in Phoenix, which could also lead to a resolution.

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

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