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Strike could hit American
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May 30, 2001: 5:40 p.m. ET
Flight attendants reject arbitration, starting clock to a late June strike
By Staff Writer Chris Isidore
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NEW YORK (CNNfn) - Flight attendants at American Airlines have started the clock ticking toward a possible strike by rejecting an offer of binding arbitration by federal mediators.
Under the labor law controlling negotiations in the airline and railroad industries, the National Mediation Board is now likely to declare a 30-day "cooling off period," after which the flight attendants could conceivably go on strike. Rank and file membership at the nation's second-largest airline, have already voted to authorize a strike.
Officials with the Association of Professional Flight Attendants, the union representing about 23,000 flight attendants, were not immediately available for comment, but Reuters quoted spokesperson Lori Bassanie as saying, "We still believe we can reach an agreement in the next 30 days with American."
The union issued a statement quoting its president, John Ward, as saying, "Whether we strike or not depends on the company." He said in the statement that the company has not been willing to put the money on the table to get a deal done.
The rejection of arbitration by the union was not unexpected. In fact acceptance of arbitration by both management and labor would have been nearly unprecedented in airline negotiations.
A statement from American said it had offered the union a 21.6 percent pay scale increase over the six-year life of the contract, a lump-sum payment equal to 5 percent of earnings from November 1998 through the end of 1999 and a signing bonus equal to 3 percent of wages from July 1 last year through June 30 of this year, as well as profit sharing.
"We are disappointed APFA did not join us in accepting the NMB's proffer of binding arbitration," said the airline's statement. "We believe doing so would have resulted in a fair and fast resolution of the few remaining open issues."
It said it was ready to meet with the union anytime in the next 30 days and that it believed a negotiated settlement was the best solution to the contract dispute.
Bush could block airline strike
Pilots at Delta Air Lines reached an agreement with that airline during their 30-day cooling off period earlier this year. Even if there is no agreement, President Bush has the power to keep flight attendants on the job, a power he used to avert a strike by mechanics at Northwest Airlines in March. Many analysts believe he would use that power to keep American flying as well.
Bush said at the time of his move at Northwest that he was concerned that the impact of a strike at a major airline would have on the slowing U.S. economy. American's statement referred to those comments by the President.
"We want to assure our customers that we do not anticipate any disruption in service," its statement said.
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The company reached an agreement with the union in 1999, only to see rank-and-file members reject what would have been a six-year deal. Donald Carty, CEO of American's parent AMR Corp., (AMR: Research, Estimates) warned shareholders earlier this month that rank and file rejection of tentative agreements is one of the problems reaching labor agreements in the industry today.
The flight attendants' are not the only labor talks facing American. Its pilots, who staged an illegal work stoppage in early 1998, have their contract come up for negotiation later this summer.
AMR recently completed the purchase of Trans World Airlines, making it the world's largest airline holding company, although until TWA is merged into American it remains the second largest airline to United Airlines. Shares of AMR closed down 37 cents to $37.92 in trading Wednesday, ahead of the announcement from the flight attendants. 
Reuters contributed to this report
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