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Shutdown Looms as American, Pilots Begin Negotiation Talks

By David Segal
The Washington Post

Travel agents have started urging customers not to book American Airlines as the country's second-largest carrier and its pilots union began talks Monday aimed at heading off a strike that could begin at 12:01 a.m. Saturday.

Representatives from the airline and the Allied Pilots Association, which represents American's 9,000 pilots, met into the evening at a downtown hotel in an attempt to overcome disagreements over wages and whether American's subsidiary commuter airlines will be permitted to fly jets.

With the weekend deadline looming, some travel agents said they are recommending that passengers avoid American if they intend to fly after Friday.

Last week, officials at American sent memos to travel agencies advising them that passengers holding American tickets have three options: they can reschedule without incurring any charges, they can receive travel vouchers worth the value of their fare, or they can request a full refund.

Local travel agents say they assume that American officials will soon announce that another airline - or two - would accommodate their passengers, as is common when one airline suspends operations.

The talks between the airline and its union, which are being overseen by federal mediators, started with an afternoon session Monday to set an agenda for the coming four days of meetings.

The talks are expected to focus on two core issues. The APA has asked for pay increases, cost of living adjustments and stock options that the airline says will cost $200 million per year.

In January, APA members rejected a tentative contract the union leadership had reached with the airline last September, fired its negotiating committee and issued new demands.

In a recorded message, officials at American Monday reiterated their intention to shut down the entire airline and send 80,000 employees home without pay if a settlement is not reached.

Even if passengers are able to find alternative flights, the impact of a strike on American could be devastating, say experts.

"American had about $14 billion in sales last year and a strike that lasts a month would basically wipe away all of its profits in '96," said Darryl Jenkins, a professor of airline management at George Washington University.