The union for the pilots at American Airlines have come to a tentative agreement with management, Reuter’s is reporting. The two sides reached a on Wednesday in regards to a cost-cutting contract which was intended to halt the airline’s threat to abandon the current deal via bankruptcy before imposing stricter terms.
In a 9 to 7 vote, The Allied Pilots Association board decided to send the last offer to its 10,000 members for them to consider.
The members are expected to vote on the contract in the next few weeks. American Airlines is currently asking a court to rule on whether the company can end the pilots’ current contract, but due to the new possible agreement, the judge of the case has postponed his ruling. The ruling was supposed to occur on Friday.
Details of the tentative deal were not made public, but some of the proposed terms have been disclosed, and they included yearly pay raises, no layoffs, $315 million in annual cost savings - as opposed to the $370 million the airline originally asked for - and a stake in the new company.
In a statement, American Airlines said, "We believe this agreement addresses the needs of our pilots while achieving the goals of our business plan, and further demonstrates our commitment to reaching consensual agreements with all of our unions."
The carrier is attempting to cut over $1.2 billion in costs from its unions each year. If the union agrees to the proposed six-year deal, the company can turn its attention to other financial worries. In fact, this past November the airline filed for Chapter 11 protection from creditor
The pilots’ union is the most powerful one, and if they settle a deal with the company, then unions for mechanics and flight attendants will likely also be able to form new agreements when those groups’ leaders meet with the airline next week.
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