5.20.03

This is APFA Vice President Jeff Bott with a special APFA HotLine update for Tuesday, May 20, 2003.

The following is additional information about the 777-Atlantic Presidential Staffing Award. As most of you know, the APFA won a decisive victory – a success that will impact us for years to come. Arbitrator Bonnie Weinstock concluded that our Contract was violated when the company removed the #12 flight attendant without reducing the service, and thereby creating an unreasonable workload. She ruled that the company had to either put the #12 flight attendant back on the 777AE or reduce the service to ensure that our work load was not unreasonable. In addition, Arbitrator Weinstock ordered the company to pay under staffing pay to all affected flight attendants from the date the #12 was removed – April 1, 2002 until the #12 is restored or the service is sufficiently reduced.

The 777AE Award was finally signed off on March 20th, in the midst of the specter of imminent bankruptcy and negotiations to cut 340 million dollars out of our contract. Once the Award was announced, the company indicated that it intended to fight the Award in federal court, and possibly delay implementation of the award for years to come. In addition, I had to face the reality that our back pay award could be negated in the event that the company went into bankruptcy. My department has worked to ensure the viability of our 777 award, and I am very pleased with the outcome, particularly under the circumstances in which we were working. This was a hard fought case by both parties as the ramifications of winning this Award is fundamental not only to the back pay issue, but also in determining staffing in the future.

First, the understaffing damages are still accumulating and APFA anticipates the final payout to be about $9 million dollars. The Company expects to resolve the unreasonable workload by June 1, 2003, with a reduction in service, however, APFA retains the right to challenge the level of service as it relates to a Flight Attendant’s workload. Understaffing pay will continue to accrue through May 31, 2003 or until the service is adjusted.

Second, we have agreed upon two options for payment. Each flight attendant who is entitled to payment as a result of the 777AE award will have their damages individually calculated and will be entitled to select their payment option. Option one is in the form of a loan to AA with payment due on October 15, 2004. Flight attendants selecting this option must be on AA pay roll on October 15, 2004 in order to receive payment. This loan has been secured by two of American’s Super-80 aircraft and engines and carries a 4.25% interest rate for the life of the loan. These two Super-80s have no liens superior to ours, therefore, these collateral aircraft will be secured even in bankruptcy if a filing occurs after July 15, 2003. Their tail numbers are N469AA and N430AA. Option two will be compensation in the form of vacation days. Each eligible flight attendant will receive their own calculation, and the vacation day conversion rate. There will be a separate vacation bidding period for flight attendants selecting this option. Vacations will be available for the 2004 vacation period which runs through April 2005. Additional information regarding this issue will be forthcoming.

If you believe you are entitled to understaffing pay under this award, please ensure your address on file with American is accurate so that you can be contacted regarding these two options.

The implications of the 777 arbitration award are far reaching in terms of both safety and job security. I am very grateful to the many representatives in my department who worked long and hard to achieve this outstanding success. This Award can be viewed in its entirety on the APFA Web site.

Now, please stay on the line for the rest of the APFA HotLine.

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This is George Price, APFA National Communications Coordinator with an APFA Hotline Update for Tuesday, May 20, 2003.

The Homeland Security Department has elevated the current threat level to “Orange” or “High.” The SSI Web site has been updated with the very latest information available. To access the information included on this site, go to the Flight Service Web site, click on My Job and then Safety and Security. The APFA Safety Department would like to encourage all Flight Attendants to obtain as much information related to their destination as possible. Always be aware of your surroundings. Alert the authorities any time you feel threatened. On layovers, do not travel alone. Always let other crewmembers know where you are at all times.

Flight Attendants who will be transferring into STL will soon be receiving an information packet from American. The packet will contain information on moving and reimbursement. The company will reimburse Flight Attendants who voluntarily or involuntarily transfer to STL for moving expenses in accordance with Article 16.C of the contract if they elect to relocate.

The Contract Department would like to clarify the fact that Flight Attendants currently on an Overage Leave that will be transferring into STL will have their Overage Leave cancelled for the month of June 2003. This is being done to provide those on Overage Leave the opportunity to attend training and bid for STL for the month of July. Affected Flight Attendants will not fly in June, but will be provided a schedule and will be paid.

From the contract and scheduling desks; The International reduction in force effective June 1 is considered a change of base and will cause you to fall into a new reserve rotation if your seniority is subject to reserve at the domestic base. Therefore, if your seniority is subject to reserve at the domestic base you will be on reserve in June regardless of last month you served reserve.

The provision of the Restructuring Participation Agreement that provides for deadhead pay at 100% and credit at 50% will be implemented for the contractual month of June 2003. At the time bidsheets went to print the Company’s allocation department did not show the proper amount of deadhead pay in the sequences. Therefore, if you look at a sequence in the bidsheet, you will not see the appropriate amount of pay associated with deadheading. The proper amount of pay is reflected in DECS in the HSS entry for sequences beginning in the contractual month of June. The omission of pay from the sequence would not alter the value of the trip credit showing on selections as there is no credit involved in the error. However, it is possible that a selection will have additional pay if it contains sequences with deadheading.

The Contract Desk has received many calls from Flight Attendants who were “subject to” furlough asking why they are not eligible to take an Overage Leave now that their “subject to furlough” notices are being rescinded. Per Article 16.A of the contract, “Prior to a reduction in force, the Company will, to the extent possible, make leaves of absence available to Flight Attendants who are not “subject to furlough.” Only if the Company had rescinded the “subject to furlough” notice prior to the end of the Overage Leave bidding period would Flight Attendants “subject to furlough” be eligible to proffer for Overage Leaves and Partnership Flying.

American’s Outplace Development Office in conjunction with various state unemployment offices and Division of Work Force Development offices are working to setup informational meetings for Flight Attendants affected by reduction in force. APFA has been working with the company’s Outplacement Representatives to publicize these meetings. The meetings are designed to provide information regarding unemployment benefits, COBRA, grant information, job placement, financial planning, and additional information useful to employees facing reduction in force. APFA highly encourages all Flight Attendants who will be affected by reduction in force to attend one of these meetings. The following is a list of meetings that have been finalized:

LGA-May 21st at 1000 and 1400. Flight Service Conference Room, Hanger 3, 3rd Floor.

JFK-May 22nd at 0900, 1130, and 1500. Group Room, Terminal 8-Mezzanine Level.

DFW-May 22nd at 1000 and 1530. Yandry Center across from gate C3.

More information on these meetings can be found on the APFA Web site on the base pages of the bases affected, the “Furlough Assistance Events” on the Furlough page, and the Calendar. We will update this information as new meetings are finalized by the Company’s Outplacement Development Office.

A Retirement Seminar is scheduled for Boston on May 22nd at 1030 in the Virgin Atlantic Room.

From the APFA Health Department: The following bullets points may assist you with the problems that you may incur with your current benefit changes. The deadline for changes is May 20, 2003. You may change your plan type only. You may not change specifics within the plan at this time. You may change specifics within your plan during the annual fall enrollment for the year 2004.

*Flight Attendants on Leave of Absence (LOA) are not considered to have adjusted benefits yet and therefore are unable to make changes at this time. Changes may be made within 30 days after returning from leave.

*Due to IRS laws, Flex Benefits and Daycare Reimbursement Accounts cannot be changed until annual enrollment in the fall for 2004. Changes may only be made to these accounts if a Life Event occurs. Salary reduction and benefit cost increase do not qualify as a Life Event.

*The APFA Health Department has notified Employee Services of the difficulties Flight Attendants are having making these benefit changes. If you are unable to complete your change due to “system” complications, please notify your FSM and the APFA Health Department (ext.8301) or contact the APFA Health Department via e-mail at [email protected].

*American will no longer split the cost of health benefits between employees married to other American employees. In order to waive your insurance coverage and add yourself to your spouse’s coverage, you must first add the employee who will be waiving coverage to the employee that will be carrying the family coverage. The employee waiving benefits will select “Employee AA Married.” It will show zero cost. If both employees have Dental coverage, it will carry over to the married plan.

APFA President John Ward along with other National Officers plan to visit each base in the system during the month of June. Once the meeting plans are finalized, we will be sending each Flight Attendant a schedule of the meetings including dates, times, and locations. This information will also be included on the APFA Web site and APFA Hotline. Due to hotel meeting room availability in many cities, we will be unable to finalize the plans prior to the closing of the June bids.

Late last week, the APFA Web site encountered a technical problem, which unfortunately restricted use of the “members only” section of the web site for a few members. This problem was corrected within a few hours, and all member’s access was restored. We apologize for any inconvenience.

That is it for this edition of the APFA Hotline. For the latest information and past editions of the APFA Hotline, please visit the APFA Web site at www.www.apfa.org.