Big U.S. airlines have erased most of the ghosts from their past. They don't engage in many market share battles or fare wars anymore. They don't dump capacity. But they still have labor disputes with their unions. And those can be as disastrous to operations today as they were two or three decades ago.
Passengers flying American Airlines this summer may want to thank a federal judge in Texas for saving their travel plans.
On Friday, when many were preparing for Father’s Day Weekend, John McBryde of the United States District Court for the Northern District of Texas granted American Airlines a temporary restraining order in a case the airline filed against its mechanics union. The judge ordered members of the union, the TWU-IAM Association, to stop what American suggested was a coordinated effort to pull airplanes from service to delay and cancel flights. The two sides have been in contentious negotiations on a new contract, and no resolution is imminent.
Consumers may not have been following closely, but if they plan to fly American soon, they probably should have, as this dispute has caused more operational problems in the past month than the grounding of American’s 24 Boeing 737 Max jets. With the Max not flying indefinitely, American has been canceling flights weeks or months in advance, allowing passengers time to rebook. But the airline never knew when mechanics would discover a problem, so this dispute caused more disruption.
American’s managers may have suspected some of the issues cited by mechanics were dubious, but safety is paramount, so the airline had been forced to park more planes than usual this spring.
In a 23-day period ending June 14, American told the court it had been forced to cancel 722 flights because of what it called a “maintenance slowdown.” During that period, American said more than 175,000 passengers had their travel plans disrupted by the union’s actions.
The union, a representative of which did not reply to a request for comment, denied its members were intentionally slowing the airline. But it is bound by federal law and on Monday, it told its members to comply with the ruling by resuming normal working schedules and practices. “No employee should engage in any concerted refusal to perform normal operations,” it said.
In a statement, an American spokesman said the carrier is pleased with the judge’s ruling. “We look forward to working with them to get back to running the most efficient operation for our customers,” the spokesman said.
Going Too Far
The work slowdown is a time-honored airline tradition.
Under U.S. labor law, unionized airline employees cannot strike until they’re released by government mediators — something that rarely happens. So to exert leverage, union members try other tactics. Pilots might taxi more slowly, refuse to fly an aircraft with a minor problem, or take short delays at the gate. Mechanics, meanwhile, might flag an airplane as unsafe even if, in another time, they might defer the repair. Or they might take longer than usual to fix a broken airplane.
This American situation has been as bad as any in recent memory, including recent similar action by Southwest Airlines’ mechanics. Southwest also sued its mechanics union, but the case became moot after the two sides reached an agreement on a new collective bargaining agreement. Southwest’s workers got a big raise.
In its lawsuit Southwest said between Feb. 11 and Feb. 22 of this year, mechanics pulled from service an average of 46 aircraft per day for technical reasons.
At American it has been worse. In its filing American said mechanics removed from service an average of 61 airplanes per day during a 10-day period ending June 13. In 2017 and 2018, American said, there was not a single day in which the airline had more than 60 planes out of service.
Back to Normal?
Nasty as this saga has been, the worst is probably over. It is unusual for any union to defy a ruling from a federal judge, so American’s operations should improve considerably.
But that doesn’t mean everything is back to normal. The underlying labor dispute remains and should continue until the union has a new comprehensive collective bargaining agreement. That may not happen soon.
American’s situation with its mechanics is more complicated than with other work groups. American, which merged with US Airways in late 2013, now has two different groups working under separate agreements. A group of former US Airways mechanics works under one contract, negotiated long ago by the International Association of Machinists (IAM), while a group of former American mechanics workers under another, negotiated by the Transport Workers Union (TWU).
Rather than choosing one union over the other, as is common, the IAM and TWU decided to join to negotiate a contract for the combined workforce.
There are a lot of stakeholders, all with different ideas, but the combined union has said it has two main sticking points.
First, it doesn’t like that American has been performing more maintenance work outside of the United States. It has objected to American spending roughly $100 million a new maintenance center in Sao Paulo, Brazil. The union calls it outsourcing, but American is using its own mechanics, asking them to perform route work while the airplanes sit for roughly 12 hours between flights. It is similar to how Qantas uses U.S-based mechanics to work on its jets while the airplanes sit all day in Los Angeles.
Second, the union wants better benefits and higher wages, as well as what it calls “retirement security.”
The union has claimed American’s management is not interested in giving it the industry-leading contract it seeks. Over time its leaders have become increasingly angry, with TWU President John Samuelson last month confronting American President Robert Isom at an airline event in New York.
“If this erupts into the bloodiest, ugliest battle that the U.S. labor movement ever saw, that’s what’s going to happen,” Samuelson told Isom at an employee forum.
In an interview later with Brett Snyder, an airline industry expert and blogger, Samuelson declined to back down, saying he “absolutely, totally believes” that American is an enemy of the union. Given the animosity, Snyder said, an agreement might not be coming soon.
“The rhetoric is getting uglier,” Snyder said. “Will that force management to cave? It’s hard to imagine. Will labor give in? The increasing rhetoric — let alone the alleged slowdown — says otherwise. Getting to a contract requires a collaborative approach, and there doesn’t appear to be any movement toward making that happen.”
In public statements American executives have tried to reduce the hostility. Last week American CEO Doug Parker told shareholders American wants a deal, saying American would agree to the same terms any of its competitors have with their mechanics unions. Still he admitted the sides aren’t close.
”We’re working very hard to get that negotiation to a point where we can deliver to our team what we want to deliver, which is by far the best contract in this industry for all of those team members,” he said. “We haven’t been able to crack the code to do that.”
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Photo Credit: American Airlines maintenance technicians repair an overhead bin. The airline is in a labor dispute with its mechanics union. American Airlines