History of the 2003 Restructuring

Don't Let 'em Rewrite History at the Expense of Flight Attendants

AMR lied about the financial condition of the airline and used the horrors of 9/11 to tug at the heartstrings of employees in an effort to exploit them. For flight attendants, that meant being forced to work under an agreement that wasn't properly costed, properly negotiated, or properly ratified.

Eight years after the fact, I still can't find one shred of truth associated with it. Even the bonuses were a lie. As The Wall Street Journal reported, "The company also said it briefed union leaders before the voting, but under confidentiality restrictions, on all aspects of executive compensation, including the supplemental pension funding and the retention bonus program."

In 2010 the Glading Administration asked flight attendants to write NMB Mediator Harry Hoglander in an effort to complain. Following is what I wrote him. I believe it summarizes eight years of indignities at the hands of corporate governance and union leadership.

November 2010

Mr. Harry Hoglander
Mediator, National Mediation Board

RE: American Airlines vs. APFA

Mr. Hoglander,

APFA has asked their members to write you in an effort to complain about the lack of progress being made at the bargaining table. APFA Leadership would like us to tell you sob stories about the hardships we face in comparison to the luxuries that AMR executives have enjoyed at the expense of their employees. Let me state for the record, neither the company nor the union is telling you the truth. There’s a whole other side to this story, one that I’m about to tell you.

Contrary to what you've probably been told, the relationship between American and APFA is anything BUT acrimonious. That's a misnomer. In truth, the relationship between American and APFA can best be described using an expression both parties coined during the Spring of 2003: a "working together" relationship, one which both parties have promoted with expressions like "Pull-Together - Win Together," and developed through numerous "Joint Leadership" committees devoted to making employees feel as though they're included in corporate decision making when in reality they’re not at all.

This all stems from a corporate strategy called the "Turn-Around Plan," a plan implemented in early 2001 (prior to 9/11) and set into motion in the Fall of 2002. The goal of the strategy was to align American with low-cost carriers such as Southwest. The strategy was based on "Active Engagement," a theory outlined in our current CEO's 1982 Thesis. The theory points out that it's historically difficult to get real concessions from employees unless the company can convince employees that all will be lost if concessions aren't achieved. In order to accomplish this, the theory stresses, the company needs the cooperation of union leadership in an effort to promote doom and gloom to the employees. It is only through this tag-team effort that employees will forfeit pay, benefits and work rules without asking too many questions. It’s a strategy based on hysteria, fear, intimidation and harassment — facts are completely omitted.

You're probably asking yourself, why is this person telling me all this?

Well Mr. Hoglander, as a flight attendant for American, I'm simply tired of being lied to. For more than seven years now, I've had to listen to my union leadership complain about executive compensation, screaming chants like "Decline or Resign" and "Pulling Together or Pulling Apart," knowing full-well that my union leadership agreed to the executive perks as part of the 2003 Restructuring. You see, the truth of the matter is that APFA leadership in 2003 promoted these executive bonuses as a "benefit" for the flight attendants, going as far as to state that these bonuses would "sweeten the deal" and "ensure Flight Attendants receive fair treatment when the Company returns to financial viability." APFA solidified these assertions by stating that "Management's cash bonuses [would] be tied to the same performance measures [as employees].”

American's senior management, too, was right on board with this corporate/labor love-fest. Senior VP Jeff Brundage wrote that "the bonuses for managers reward 'superior performance,'" further adding that "[American's] compensation policy is designed to hold managers and executives directly accountable for the company's performance..." Yes, even though American's senior management has cried poor mouth for the last seven years, whereby admitting that the executives' "super performances" have yet to show results, American continues to dole out bonuses as though American is doing well. What little profit American seems to have been able to eek out over the past seven years is nothing more than a concessionary profit — money taken from employees and restated as revenue.


We voted NO to this, Mr. Hoglander. When American came to its flight attendants demanding a $1.6 billion dollar handout, offering employees absolutely nothing to support their claims of necessity other than their own assertions, the flight attendants said NO. Management was demanding $340 million per year in concessions from a workgroup whose best contract ever was worth only $120 million per year in gains. Management wanted us to believe that all of a sudden, out of the blue, American was teetering on the brink of bankruptcy, and that we, the employees, only had 15 days to vote on the decision of our careers, a decision that was to be based on virtually no information at all, not even the final contract language. I know, it's absurd, but we did it. We voted and we voted NO. We were willing to help our ailing company, but we weren't willing to forfeit decades of collective bargaining simply to satisfy management's unsubstantiated hysteria, not to mention intimidation and harassment.

Sadly though, for the flight attendants, NO wasn't good enough. When flight attendants voted NO 9842 to 9309 on April 15, 2003, American's senior management and APFA's leadership banded together and agreed to reopen voting. This resulted in a YES vote the very next day, one with fewer NO votes then the previous day even though the votes had already been tallied. When APFA couldn't explain the voting anomalies, they declared the vote "tainted," promising members a revote, a revote that was later reneged upon and replaced with the will of the company. The flight attendants’ voice was silenced completely.

A group of the flight attendants then filed a Federal Complaint in an effort to overturn an agreement that wasn’t properly costed, properly negotiated or properly ratified. While, again, we were willing to help our ailing company, we weren’t willing to forfeit decades of collective bargaining based on corporate assertions that weren’t supported with any facts. We wanted a tangible contract with readable language, and we wanted snap-backs and/or contingencies that would protect us from having to watch AMR executives lavish themselves with employee contributions. We were asking for facts and figures but instead what we got is a contract that is so different from what we were told to expect that the company and union refuse to even print it. Seven years we've been waiting for a written contract and still we wait. See for yourself; ask for the contract. What you’ll get is a document printed off the computer, one that the company and union can change at will with employees being none the wiser. Honestly, what good is a contract if you don’t have a hardcopy. It’s meaningless.


Instead of siding with the flight attendants and forcing the company back to the barging table, APFA leadership instead sided with the company in defense of the concessionary agreement. While execs continued to dole out hundreds upon hundreds of millions in bonuses to themselves as a reward for taking money rather than making money, APFA stood right next to management and defended the company’s right to grossly enrich themselves stating that employees have no right to sue their employer even when it’s alleged that the employer colluded with the union leadership. APFA spent $2.5 million in membership dues protecting corporate greed while their own members were tossed out onto the street like bags of trash. The leadership even went as far as to give themselves a pay raise in July of 2003 so as to not suffer the hardships caused by the agreement that they had just jammed down our throats. Our current president, Laura Glading, continues to enjoy that pay raise even today.


The union leadership, in an effort to protect corporate greed, even went as far as to destroy key voting records associated with the company’s 2003 restructuring even though the union was legally required to maintain those voting records for one full year. Plaintiffs asked for those voting records in court because we discovered that the voting system had a huge security flaw built into right it, one which would allow anyone with a Seniority List and knowledge of the security hole to vote for whomever they wanted. The security flaw was that the PIN numbers where sequential alphabetically by base. We believed that individuals other than the voters themselves were placing votes in favor of concessions. Given that the union knew of the security flaw but allowed it to continue, and given that the union later destroyed the voting records prematurely when the records were demanded in court, our suspicions were well founded.

Now rather than investigating the loss of the voting records, union leadership instead reappointed the individual whose responsibility it was to maintain those records. Either the union leadership took on a new policy of rewarding incompetence, or the union leadership was simply protecting itself from what appeared to be blatant voter fraud. In either case, the union was protecting the company, not the flight attendants.


Our last union president, Tommie Hutto-Blake, was able to retire with an unprecedented retirement perk — unlimited, lifetime, positive-space A5 travel. She’s the only APFA president ever to do so. It’s important to note that the last time American sold an unlimited, lifetime, positive-space AAirpass the year was 2004 and that pass sold for $3 million dollars. Needless to say, eyebrows were raised everywhere but at union headquarters where the Glading administration opted to not investigate.


Just when you think the relationship between American Airlines and APFA couldn’t get anymore incestuous, in the Fall of 2007 Missouri senator Claire McCaskill became involved in APFA’s union officer election without disclosing that she was close personal friends with the incumbent administration. Sources tell me that the senator and APFA Negotiating Chairperson Anne Loew, whom I’m sure you’ve met, were roommates in college. While I don't know the exact relationship between Senator McCaskill and Anne Loew — whether they were roommates or not — what I do know is that the two studied political science at the University of Missouri and both graduated one-year apart — 1975 and 1976. Also known is the fact that the senator's sister, Anne Moroh, is a retired American Airlines flight attendant, a former APFA treasurer, and a named Plaintiff in a lawsuit filed against APFA in 1984 — Adams-Lundy vs. APFA. Without a doubt, the senator had a long standing rapport with APFA, certainly the incumbent APFA administration, even though the senator failed to mention that relationship knowing that the union was in the midst of a union officer election.

Why this is important is because while the union was telling flight attendants that the company wouldn’t agree to a recall extension in 2007 for the former TWA flight attendants, in reality the company and union re-extended the Two-Year Recall Extension again in 2009 and have since agreed to unlimited recall rights for everyone furloughed after November of 2002, neither of which necessitated the senator’s political involvement. The only reason the senator got involved in 2007 was because APFA was (1) in the midst of a very important union officer election, one which would determine whether the union continued defending the company in court or whether they would side with the flight attendants against the concessionary agreement in an effort to overturn it, and (2) Anne Loew’s future within the organization hinged on whether or not the incumbent administration maintained control of the union. Given that the Glading administration opted to continue supporting the company, it’s fair to suggest that the senator was protecting her friend, not her constituents.

It’s important to note, Mr. Hoglander, that only those furloughed during the company’s restructuring were given a recall extension, those furlough before were not even though many were Senator McCaskill’s constituents. The only reason the company and union extended recall was because of the lawsuit challenging the validity of the furlough. That’s why the extension date is set to November 2002. Needless to say, it was in the best interest of the company AND union to extend recall and therefore the senator’s involvement wasn’t needed at all. The senator’s involvement was about manipulating the election — that’s’ all. The senator helped create 410 additional voters overnight who were encouraged by their APFA Base reps to withhold votes during the primary election so as to support a candidate during the run-off. By Senator McCaskill’s own account, the Recall Extension affected 1,200 flight attendants. John Ward lost the election by 1,057.

When I look at the Letter of Agreement (LOA) extending recall for the former TWA flight attendants and compare the names on the letter to the contributions made to Senator McCaskill's 2008 Campaign Fund I see that several AMR executives donated to her campaign even though these executives made very few contributions outside of the American Airlines PAC. Mark Burdette, Wil Ris, Laurie Curtis Hadobas and Dan Garton, all of whom signed the 2007 Recall Extension, donated to Senator McCaskill's Campaign Fund as did Gerard Arpey and Jeffery Brundage. From APFA, only the Senator's friend, Anne Loew, donated. She donated twice in 2006, and these were Ms. Loew's sole political contributions, which means that Senator McCaskill held a special place in her heart even before the national officer election.


And so, Mr. Hoglander, American and APFA have been working together now for seven years going on eight, but now they want flight attendants and yourself to believe that they can’t work together to hammer out a new contract. That’s hogwash. If the Glading administration can defend an agreement that’s grossly enriched executives at the expense of flight attendants, surely they can’t negotiate a new contract. And the same goes for the company. If they can reward our last union president with a $3 million dollar retirement perk and hand out almost $400 million to executives, then surely there’s enough money for a new contract.

Don’t let ‘em fool you Mr. Hoglander. We’re not fooled, and neither should you be.

Rock Salomon
American Airlines Flight Attendant BOS
Association of Professional Flight Attendants Member