As most of the airline industry is struggling to stay afloat, America’s third largest airline company is working to get through its Chapter 11 bankruptcy filing. American Airlines (AA) announced last week that it would be firing 15% of its workforce. As per the bankruptcy agreement, the company has to make some serious financial changes. One of the changes proposed this week is the layoff of about 13,000 people. In addition, AA hopes to eliminate traditional pension plans and cease paying for retiree health benefits. As with any serious changes like these, they have been met with opposition from several parties.
The unions that work with the airlines are lobbying to keep pension plans in place. Company officials are currently in negotiations with the three unions that represent its workers. No matter what the unions say, however, the company is insistent that it must cut labor costs by at least 20 percent. By spending cutting by at least $2 billion per year, the company hopes to see revenues of $1 billion annually. If your company is on the verge of filing for Chapter 11, discuss your financial circumstances with a San Antonio bankruptcy lawyer today by contacting the Malaise Law Firm.