FORT WORTH, Texas (AP) -- American Airlines flight attendants have accepted $340 million in labor concessions, but the world's largest carrier says it still faces the possibility of bankruptcy.þþAmerican's chairman and CEO, Donald J. Carty, praised the deals but said the economy and other factors affecting business were beyond the company's control.þþ``I must caution, however, as I've said before -- we are not out of the woods yet,'' Carty said Wednesday after the flight attendants' vote was announced.þþThe vote marked a reversal from a day earlier, when flight attendants narrowly rejected the package of layoffs, wage cuts and reduced benefits. They were given an extra day to vote after some workers complained about trouble voting online and by telephone.þþThe Association of Professional Flight Attendants said 10,761 votes were cast for the concessions package and 9,652 against. On Tuesday, the package was losing by fewer than 500 votes.þþ``We are almost solely returning (American parent company) AMR to profitability under our concessions,'' said 26-year flight attendant Deborah Seale, who voted against the deal. ``Management will get a 4 percent cut off the first $30,000 of their salary, and most of us don't even make $30,000 a year.''þþIn news sure to spark anger among the rank-and-file, AMR Corp. funded a supplemental pension trust last year for its top 45 executives that protects part of their retirement income in the event of a bankruptcy filing, the Wall Street Journal reported Thursday.þþThe perks -- including bonuses of twice the base salaries for AMR's top six executives if they stay through January 2005 -- were disclosed late Tuesday in the company's year-end financial filing with the Securities and Exchange Commission. The Journal said AMR would not disclose how much money the company put into the trust.þþIf flight attendants had rejected the labor cuts, AMR's board of directors was prepared Wednesday night to approve a Chapter 11 bankruptcy court filing to conserve cash and avoid credit payments of at least $50 million, company spokesman Bruce Hicks said.þþAmerican says it must cut annual costs by $4 billion -- including $1.8 billion in spending on its 99,000 employees -- to remain afloat and compete with low-cost carriers.þþIn earlier voting, pilots and ground workers approved their share of the concessions, saying they feared even deeper cuts if the company filed for bankruptcy.þþIn its SEC filing, American said that even with the concessions from employees and vendors, ``the company may nonetheless need to initiate a Chapter 11 filing because its financial condition will remain weak and its prospects uncertain.''þþSome flight attendants opposed to the concessions accused American of improperly extending the election by one day and pressuring workers to vote for the deal, which would cut their pay by 15.6 percent on May 1.þþIn a letter Wednesday, union president John Ward told American to ``back off and stay out of our voting process.''þþThe company acknowledged that it distributed informational leaflets and electronic messages to employees but denied any wrongdoing.þþFitch ratings service said the concessions would bring American's unit labor costs in line with rivals Continental, US Airways and United. The latter two were able to reduce costs through the bankruptcy process.þþOver the past two weeks, employees voted on whether to ratify agreements struck March 31 -- on the brink of an earlier bankruptcy deadline set by the company -- that called for layoffs for 2,500 pilots, about 2,000 flight attendants and up to 1,400 ground workers.þþAmerican sought $660 million in annual concessions from its 12,000 pilots, $620 million from 34,000 ground workers and $340 million from flight attendants.þþOver the past two years, Fort Worth, Texas-based AMR has lost nearly $5.3 billion as it struggled with a weak economy and terrorism, which dampened travel demand.þþ
Source: NY Times
