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In hopes of a management-union deal at American Airlines, judge delays ruling on union contracts

American Airlines, under Chapter 11 bankruptcy protection since November, is trying to save $1.25 billion in labor costs. According to a Thomson Reuters June 22, 2012 article, other airlines have gone through this process before and it made them more competitive.

The labor cutting measures targets pilots, flight attendants and some ground crew. American Airlines management has been in talks with these groups. The flight attendants union has stopped negotiations. Therefore, the fate of their contracts will be in the judge’s hands next week. The unions representing the ground workers are split on their decisions.

Pilots typically play a vital role in negotiations, sometimes as an intermediary between management and unions. The pilots’ union would not pass on the latest contractual offers to the other unions for various reasons. Management wanted to cut 17% overall costs while providing a pay increase over five years of nearly 15%.

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