American Airlines and the TWU-represented Ground School & Simulator Pilot Instructors workgroup reached a consensual agreement on May 15. This ratification is an important step forward and provides American with the cost savings necessary to be successful, while providing to employees a variable compensation plan for industry-leading performance, future pay increases and a profit sharing plan.
This compromise demonstrates American’s commitment to its people and the negotiations process, and also shows the TWU’s efforts to collaborate in order to move forward and refocus our energy on building the new American.
Now we can begin implementing the changes that will allow us to operate a more efficient, competitive airline.
All Employee Restructuring Objectives
- Reduce employee costs
- Our approach to employee savings is focused on preserving base pay rates as much as possible by increasing productivity
- Implement universal changes to active and retiree medical for current employees (effective 2013 open enrollment)
- Address and relax restrictions on our business
- Remove structural barriers that limit flexibility and ultimately growth
- Replace pension benefit with a Defined Benefit Contribution (effective Nov. 1)
- Implement new first-dollar profit sharing plans (effective Sept. 12)
Overview of Ground School & Pilot Simulator Instructor Implementation Schedule
- Annual, Permanent Cost Savings: 17 percent of Ground School & Simulator Pilot Instructors’ total costs
- Increases number of days Instructors can work per month (effective Sept. 12)
- Adds flexibility to scheduling requirements (effective Sept. 12)
- Reduces holidays from 10 to 5 (effective Sept. 12)
- Eliminates job protection (effective Sept. 12)
- Our goal was to make fundamental changes to the Instructor operation necessary for a long-term sustainable cost structure while continuing to maintain Ground School & Simulator Pilots’ competitive pay rates.
- Eliminating the ASM Cap is critical to American’s ability to grow and allows the company to optimize its fleet. Keep in mind, the TWU-represented Ground School & Simulator Pilot Instructors’ previous collective bargaining agreement did not include the ASM Cap.