American Airlines Group Inc (NASDAQ:AAL) flight attendants dropped on Sunday by a narrow margin of 16 votes a proposed joint labor contract that would have covered a combined workforce of US-based stewards absorbed in the merger of American Airlines with the former US Airways Group Inc (NYSE:LCC).
About 16,000 stewards cast their votes, with ballot returns reflecting figures of 8,180 votes for “Yes” and 8,196 votes for “No”. In a statement, American Airlines Group Inc (NASDAQ:AAL) expressed disappointment with the outcome of the voting, saying that the tentative contract specified industry-leading pay as well as benefits. The company further noted that the terms under the defeated contract would have provided better economic value and work rules as compared to any contract that may be obtained by means of an arbitration.
In its letter dated November 4, 2014 regarding the tentative agreement, the Joint Negotiating Committee of the Association of Professional Flight Attendants (APFA), which represents absorbed workers from both the American Airlines and the US Airways, said that a vote of “No” will result in an annual loss of about $82 million representing cuts to the tentative agreement (T/A), adding that an arbitration will just focus on determining whether the cuts should be taken out of items such as contributions, wages, or vacations.
With the defeat of the tentative agreement, AFPA said the proposed deal will now be subject to arbitration, with the affected stewards continuing work under their respective current contracts until arbitration determines terms and awards a new contract. The first date set for arbitration is on December 3.
Had the contract been approved, it would have applied for the first time to employees from both the American Airlines Group Inc (NASDAQ:AAL) and the former US Airways Group Inc (NYSE:LCC), which has completed a merger settlement a year ago. The merger was completed after the two airline companies have successfully settled an antitrust case filed by the Justice Department. The Justice Department sought to block the merger, but U.S. District Judge Colleen Kollar-Kotelly said in her decision that the merger settlement would best serve the public interest. The merger combined together under the roof of the new American Airlines Group Inc (NASDAQ:AAL) a workforce of about 24,500 flight attendants.
This article has been written by Nonito Guntan.