Wednesday, June 12, 2013

American Airlines workers revolt against $20 million CEO severance deal

Tom Horton wants to loot $20 million from American Airlines after he drove it into bankruptcy in 2011.

Since then, airline workers have been raked over the coals. They've suffered layoffs, pay cuts, lost benefits and frozen pensions while the company pushed the cost of bankruptcy squarely on their backs.

The workers are pissed off!

An American Airlines mechanic who is organizing with the Teamsters at JFK airport launched a petition against the airline's shameless greed. His petition, made public just yesterday, already has over 400 signatures. He and his coworkers are urging workers everywhere to take a stand against this injustice by signing the petition.

Please take a moment to sign the petition here.

Early this year, American Airlines and US Airways announced plans to merge, creating the largest commercial airline in the world. But with American still in bankruptcy, all merger plans are subject to approval in bankruptcy court.

When the proposal was made to name US Airways CEO Doug Parker as the new head of the airline after the merger, U.S. Bankruptcy Court Judge Sean Lane raised a concerns about the $20 million severance package they wanted to give American Airlines CEO Tom Horton.

He thought it was too excessive. Ya think? 

But last month Judge Lane approved the merger deal, along with the "disclosure statement" that legalizes Horton's plunder of the airline he bankrupted. Fortunately, US Department of Justice Trustee Tracey Hope Davis is pushing back. She says bankruptcy law forbids severance payments greater than ten times the amount awarded to non-management employees. She argues Horton should get no more than what the law permits.

In addition to the mechanics' petition, one AA flight attendant started a website to support Trustee Davis.

According to Huffington Post:
[Davis'] objection also says previous company filings showed that Horton would get a maximum of $6.4 million if he had left at the end of last year, and raises the question of why he should get so much more money now. American has said in filings that the money for Horton is in recognition of his efforts during the airline’s restructuring and his role in overseeing the merger with US Airways.
Say what? Recognition of his efforts?

AA mechanics have suffered thousands of furloughs and lost jobs lost over the course of the bankruptcy. More than 1,000 jobs were cut from Alliance Ft. Worth, American's second largest maintenance hub. 

Horton's use of bankruptcy to cut labor costs is another victory for those who want to see our planes being fixed in third-world, cheap-labor countries like El Salvador and China. Most of the jobs lost at Alliance are going to Hong Kong.

On top of that, the mechanics have suffered through 25 years of concessions, including declining work standards, reduced job protections, weakened benefits and a frozen pension. That's why so many of them are organizing to join the Teamsters, which already represents 18,000 mechanics at major carriers including United Airlines.

In light of these attacks on its workers, American's attempt to give CEO Horton a $20 million reward is sparking outrage far and wide – even in the pages of Forbes, hardly a champion of corporate restraint and worker fairness.

As Forbes contributor Richard Finger wrote last week:
The 2005 Bankruptcy Reform Act expressly forbids severance payments to insiders and executives that are greater than ten times the amount for any non-management employee. So unless any of the American Airlines employees got a $2 million severance package, Horton’s bonus is therefore, by statute, illegal...[AA's board of directors] should be held to account for their egregious award to a person who had a hand in bankrupting it in the first place.
Finger goes on to urge the unions and workers to stand up and oppose Horton's package. American workers are way ahead of him. Horton's bloated severance would be coming out of their pockets. Their current union representation has been silent on the issue because – in exchange for some modest concessions to workers – they agreed to a "gag order" blocking them from opposing executive pay in the merger.  

But the workers won't be silenced. The 11,000 mechanics are organizing to become Teamsters and are hoping to hold an election soon. Meanwhile, their future coworkers at US Airways will be voting in July and August for Teamster representation.

Let's support these workers and help them fight back against CEO greed at American Airlines by signing the petition here