This is the part we disagree.
I believe there still is an agreement in place, it is just a modified agreement.
But approval of a plan to ermerge will not happen until consensual agreement is reached.
This is why negotiations begin after abrogation, not becuase there is no contract.
You really need to get a clear understanding of this becuase I feel you are being mislead on this issue.
Or I need a clear understanding of the purpose of the 1113 changes of 2005.
My understanding is that the changes of 2005 were to prevent not having an agreement in place and the distruptions that would take place while still under C11 protection you speak about.
I did find this interest PDF
http://www.restructuringamr.com/documents/1113_oal_outcomes_chart_4.16.12.pdf
Each of these list "consensual" agreement.
I still say without consensual agreements the court plan approval to emerge is not going to happen and that is where the leverage is for us and all Unions.
Under 1113 the debtor can file for interum relief, AA chose not to do that. Probably because if they had they would have showed profits since they have to get approval for expenditures from the court and would not have been able to hide the money. UAL did and in Jan of 2003, a month after filing, the court imposed a 14% paycut on their mechanics who at the time were the highest paid in the industry, In April UAL and the mechanics came up with a consensual agreement where they agreed to a 13% paycut. They got 1% back. Interum relief is temporary, until either a new agreement is reached or they abrogate the contract. Howver that same month, outside of BK we agreed to a 25% paycut and the creditors rejected the TA they had with the mechanics, they were told to get more, thanks to us.
Under the interum terms the rest of the contract remains in place. However if a new agreement cant be reached the company then files to abrogate, and shows the court the terms it claims it needs to emerge succussfully from BK, in the case of AA very successfully, they need the concessions so they can earn $3 billion a year in profits.
Now here is where it gets grey, is the company bound to follow the terms? We were told different things, initially we were told that the imposed terms were the new contract and that even if it said six years it was six years, then we were told it wasnt and for the last several weeks we were told if its abrogated we have no contract and they can walk in and start firing people for no reason at all.
So, we have to figure out for ourselves which way it is.
OK, what does "abrogation" mean? It means "to end an agreement or contract formally".
So, we have no contract if its abrogated, however nearly all companies even non-union have written policies they follow, and while they can change them even non-union workers can take legal action if they dont do as their policy states. AA presented terms to the Judge where they said the want the whole contract abrogated AND these are the terms they would put in place, the terms are a list of changes to the contract thats in place. So its no longer a union contract but company policy. So if they deviated from the terms they deviated from the basis upon which the court agreed to terminate our contract, so we should legally be able to take action, even if its not legal we should. The RLA is what really screws things up for Airline workers, SECT 1167 of C-11 simplifies things for Rail workers-their contracts can not be abrogated in BK, all they can do is jump into SECT 6 early and try and get concessions. The courts decided that does not apply to us however when Lorenzo abrogated the Pilots contract they were permitted to strike, the appelate court apparently missed that when they decided that the NWA Flight Attendants could not. The reasoning behind the different treatment under the law between airline workers and railroad workers is simple, they knew that if they tried to do to them what they are doing to us the Rail workers would tell them where they could stick their injunctions and shut down the rails.
700UW is confused because they reached consensual deals, the IAM did the same thing the TWU is doing, they met with the company, changed a few things from the original "ask' and put it before the membership and they ratified it.
From what I'm told consensual deals with labor are not a legal requirement for exiting BK however its unlikely the creditors would approve of a plan where they were not in place, of course if the operation was going to #### then there is no way they would. If that happens we have leverage, however if guys value their CS's and laptop time and overtime more than wages and benefits we are screwed.
