DALLAS (AP) -- The flight attendants' union says a bankruptcy judge's ruling against American Airlines' attempt to break its contract with pilots was only a temporary win for workers.
The Association of Professional Flight Attendants says the judge's overall ruling is "a blistering indictment of the labor unions" at American.
In a message to members Thursday morning, the flight attendants' association said the judge rejected almost all the pilots' arguments and merely postponed the "inevitable" cancellation of the pilots' contract. The union says that it would lose an appeal to the same judge, and that flight attendants should keep pushing for a merger with US Airways, which it sees as less hostile than American.
The comments highlight the dilemma facing the unions: They can accept concessionary contracts from American, or they can reject the offers but risk having even harsher cost-cutting terms imposed by the bankruptcy judge.
On Wednesday U.S. Bankruptcy Judge Sean Lane in New York denied a request by American to throw out its contract with pilots and impose measures to reduce the airline's labor costs. The judge said that American largely proved it needs to cut labor costs but failed to prove that it needed two specific items in its plan — unlimited pilot furloughs and outsourcing of flying to other airlines.
The judge said that if American parent AMR Corp. addressed his concerns about unlimited furloughs and outsourcing, it could try again to throw out the pilots' contract. AMR said it would make necessary changes and try again to cancel the pilots' contract.
A lawyer for AMR's unsecured creditors, Jack Butler, said he expected AMR to make the changes needed to cancel the pilots' contract. He said AMR must settle its labor issues — either by agreements with unions or an order from the judge — to continue its restructuring and consider "strategic alternatives," or mergers.
Sterne, Agee & Leach analyst Jeffrey A. Kauffman called Wednesday's ruling "another delay, but likely, not much more" in AMR's restructuring.
Minutes after the ruling was issued Wednesday night, the interim president of the pilots' union, Keith Wilson, called it a rare victory for labor in a bankruptcy case and a setback for AMR management.
The union believes that the ruling, even if reversed, buys it a few weeks to negotiate more favorable terms, including larger wage increases.
Flight attendants are voting through Sunday on a contract offer from American. If they reject it — as pilots did — American would ask the same judge to cancel the attendants' contract and impose stricter cost-cutting terms.
"There is little doubt that the end result, should we reject, will be 2,000 furloughed flight attendants" and others put on reserve status, the union told members.
The association recommended that flight attendants approve the pending contract offer from American "and continue to work toward achieving a merger with US Airways."
