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Judge gives pilots a break
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February 17, 1999: 2:38 p.m. ET
Pilots have less than 60 days to refute claim sick-out cost airline $150M
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NEW YORK (CNNfn) - A federal judge Wednesday gave American Airlines pilots two months to come up with figures refuting management's charge that the recently-ended 10-day sick-out cost the airline $150 million.
The Allied Pilots Association had asked U.S. District Judge Joseph Kendall for a 90-day continuance, but Kendall shortened the period to less than 60 days and scheduled arguments and rebuttals for April 12.
In the interim, the two sides can exchange scheduling information and other documents and the union must provide American with a list of witnesses.
Kendall said it was time to end "the fussing and the fighting" and to "de-escalate the tension."
"I don't want to take a bad situation and make it worse," Kendall said. "The planes are back in the air now. It's time to cool down and take the loaded guns away from each other's heads."
Kendall had found the association in contempt after pilots ignored his back to work order.
Doug Herring, the airline's vice president-controller, said the job action resulted in overall lost revenue of $150 million. For the three-day period in which Kendall found the pilots in contempt, Herring said, damages came to $58.7 million.
That assessment factored in fuel and food cost savings the airline enjoyed because of thousands of flight cancellations, but it did not factor in overtime costs incurred by reservation agents and others because of the chaos resulting from the job action.
Kendall ordered the union to post $10 million with the court until he decides on how much to fine it for failing to clearly notify its pilots to end their job action after he ordered it to do so. The APA complied Tuesday.
The judge also docked APA President Rich LaVoy $10,000 and vice president Brian Mayhew $5,000.
The sick-out forced the airline to cancel more than 7,000 flights and disrupt travel for more than a half-million passengers. The airline announced no new cancellations Wednesday for the first time since the sick-out began Feb. 6.
It said it would resume negotiations with the APA later Wednesday. The dispute involves lower salaries for 300 pilots at Reno Air, a western regional carrier acquired by American's holding company, AMR. Corp. (AMR), in December.
Those pilots are paid an average of $75,000-half the average for American's 9,200 pilots. The APA wants one pay and seniority scale for all pilots. The company has agreed to integrate the Reno Air pilots into American's system, but not immediately.
Its most recent offer, announced Tuesday, was to increase salaries of Reno pilots by 50 percent immediately. The union is concerned that American is trying to build in a two-tier pay scale that ultimately would erode the salaries of higher-seniority American pilots and possibly threaten their jobs.
Kendall noted that if the United States could make its two World War II enemies - Japan and Germany - its biggest post-war trading partners and the Cold War could end in a heap with the fall of the Berlin Wall, "surely the two sides (in this dispute) ought to be able to sit down and get this behind you."
AMR was up 1-3/16 at 56-3/16 in afternoon trading.
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