Hostess and American Airlines workers resist bankruptcy cuts

Union members and supporters rallied yesterday at the Dallas-Fort Worth International Airport to show solidarity with American Airlines workers facing job cuts and loss of benefits if the company’s bankruptcy restructuring plan is approved. The day before, the Teamsters announced that their members voted to strike Hostess Brands, the maker of Twinkies and other snack food, if the company’s unfair bankruptcy restructuring proposal is imposed on them.

It appears that for the time being the ongoing war on workers has shifted to a another battlefield–the bankruptcy court. Both Hostess and AMR, American’s parent company, recently filed for bankruptcy in order to rewrite their labor contracts. Both are proposing major cuts that will lower the standard of living for thousands of workers. Both say that the cuts are the only way to make the companies profitable again.

American, which submitted its plan to the bankruptcy court earlier this month, estimates that its proposal if adopted will save $2 billion a year; $1.25 billion, or nearly two-thirds of the savings, would be borne by its workers. Laura Glading, president of the Association of Professional Flight Attendants, which organized yesterday’s DFW rally, said that the $1.25 billion figure is too low and that the actual amount of American workers’ sacrifice would be $1.8 billion a year.

American’s plan if adopted by the bankruptcy court would eliminate 13,000 jobs and cut health care benefits. American also wants to jettison its pension plans for 130,000 workers and retirees, a move that Joshua Gotbaum, director of the federal Pension Benefit Guaranty Corporation, called “a drastic action” that American needs to reconsider.

At the Tuesday’s rally, which was attended by about 400 people, Glading said that her union would resist American’s plan. “We’re here today to show we’re not going to back down without a fight,” Glading told demonstrators.

The Transport Workers Union, which represents ground crew workers at American and co-hosted the DFW rally, has been trying to organize community support for affected workers. It’s asking people to sign an online pledge of support and yesterday announced that it would submit an alternative to American’s proposals to the bankruptcy court after the company provides financial information requested by the union.

While American wants its workers to give up their jobs and pensions, and accept cuts to their health care, it has taken steps to protect the financial well-being of its executives. On TWU’s website, Little  said that prior to filing for bankruptcy, American gave its executive “huge bonuses for years.”

Likewise, Hostess has taken steps to protect its CEO, who demanded that the company’s workers accept health care and pension cuts as well as new work rules that would make them work longer and harder with no additional compensation.

The Wall Street Journal reports that “Hostess Brands Inc. is seeking (bankruptcy) court permission for a new employment deal that would hand millions of dollars to Chief Executive Brian J. Driscoll, ‘architect’ of the company’s plan to cut costs and jettison its pension plans.”

“They have amazing laws in this land that allow a company to file bankruptcy and give the CEO such a lucrative contract while demanding deep, deep givebacks from its employees,” said Frank Hurt, president of the Bakery, Confectionary, Tobacco Workers, and Grain Millers International Union, which represents 5,000 Hostess workers, to the Journal.

A hearing on the motion is scheduled for February 21.

Meanwhile, the Teamsters, which represents 7,500 Hostess workers announced Tuesday that 90 percent of its Hostess members voted to strike if the new contract proposed by the company is imposed on them. David Raymond of the Teamsters said that its unfair to expect workers to make all the sacrifices to save the company.

“This vote shows that, while our Hostess members are willing to take significant steps to save the company, they can only go so far,” Raymond said. “Twice before, they have made sacrifices to help this company with no progress to show for it. They need to see their sacrifices matched by other key stakeholders and they need protections to make sure their sacrifices are not made in vain again due to mismanagement. While we remain committed to finding a solution to save the company, it won’t be done solely on the backs of our members and Hostess employees.”


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