American Airlines furloughing pilots

In this Oct. 28, 2009 photo, an American Airlines jet is seen at Lambert St. Louis International Airport in St. Louis. American Airlines said Friday, Jan. 22, 2010, it will lay off up to 175 pilots beginning next month because it needs fewer pilots after cutting some flights. (AP Photo/Jeff Roberson)

January 22, 2010 9:44:48 AM PST
American Airlines says it will furlough up to 175 pilots beginning next month because it has too many pilots after reducing its flight schedule. American said Friday it sent notices to 80 pilots that they will lose their jobs at the end of February. Officials said there could be a second round of furloughs in the spring.

The airline cut passenger-carrying capacity 7.2 percent in 2009 as it struggled with a downturn in travel and lost $1.49 billion. Airlines cut capacity by eliminating flights and using smaller planes with fewer seats.

American spokeswoman Missy Latham said the company would furlough up to 175 pilots -- about 2 percent of its 7,800 pilots -- in the first half of the year. She said the company has too many pilots after reducing flights and experiencing less employee attrition than expected.

The company said it already has about 1,800 pilots on furlough. They were laid off but retain rehiring rights by seniority.

American last furloughed pilots in 2005, and small numbers had been rehired since then. The pilots losing their jobs in February are among those who rehired in the past few years, said Gregg Overman, spokesman for the Allied Pilots Association.

Overman said the latest furloughs were "just another indication of the concessions our pilots have made since 2003," when the airline's unions agreed to wage cuts to save the company from bankruptcy.

Overman disputed American's claim of a pilot surplus, saying the airline is "pretty tightly manned."

The union and the company said they were discussing steps to limit furloughs, which Overman said could include early-retirement incentives.

Overman said a recent change in federal law that allowed pilots to work past age 60 could be resulting in fewer retirements.

Latham said the company and union moved up the first 80 furloughs by one day into February to make those pilots eligible for subsidized health insurance. People who lose their jobs on or before Feb. 28 can continue to buy health insurance through their former employer, with the federal government paying 65 percent of the cost.

This week, American parent AMR Corp. reported a $344 million loss for the fourth quarter. The company has lost $3.59 billion in the past two years.

American is currently locked in contentious contract negotiations with its three unions, which represent pilots, flight attendants and ground workers. The unions are seeking wage increases; the company wants to reduce labor costs.