TWU

American Airlines and the TWU-represented Simulator Technicians 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)
• Remove 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 Simulator Technician Implementation Schedule

• Annual, Permanent Cost Savings: 17 percent of Simulator Technicians' total costs
• Eliminate the ASM cap (effective Sept. 12)
• Eliminate job protection (effective Sept. 12)
• Eliminate holiday pay, in exchange for flexible DATs (effective Sept. 12)
• Allow for the ability to relax contractual staffing minimums as operational requirements dictate

 Rationale

• Our goal is to make fundamental changes to the Simulator Technician operation necessary for a long-term sustainable cost structure while continuing to maintain Simulator Technicians’ competitive pay rates.
• Eliminating the ASM cap from all TWU contracts will let American optimize its network and schedule. We would be able to improve the use of our regional network by allowing mainline jets to be redeployed for new opportunities and to place smaller jets on lower demand flights.