Member # 722
American Airlines Retirees Committee ....Protecting Our Benefits Through the Chapter 11 Process
AMRRC Members Briefing July 16, 2012
The briefing you are about to read is full of new & important fact based information for retirees. Recent events have occurred in the AMR bankruptcy case which may directly impact current retiree benefits and thus would also impact all future retiree benefits. Please consider passing this information on to others who are not members of AMRRC and encourage them to join our efforts to protect the retirement benefits of all AMR/TWA retirees!
As you know the Section 1114 Retiree Committee was appointed in April 2012 by the BK Court responsible for overseeing the AMR bankruptcy case. When the Retiree Committee was formed AMR had not officially filed a Section 1114 - the adversarial bankruptcy mechanism which a corporation uses to alter or remove retired employee benefits.
Effective July 6, 2012 AMR management filed its notice that they have entered the Section 1114 process. The Section 1114 notice is in the form of a lawsuit which is listed in the Chapter 11 Case No. 11-15463 as AMR Corporation, [Debtors] & AMR Corp & AA [plaintiffs] Versus Committee of Retired Employees [Defendant]. Further, on the same date AMR management also requested the Court to schedule a pre-motion conference asking permission of the Court to file a summary judgment motion on the issue of whether the Debtors have the "unilateral right to modify both life and health retiree benefits."
If you are an American Airlines (or former TWA) retiree you were sent a letter dated July 3, 2012 from Denise Lynn, Senior VP of 'People', noticing you in a most 'friendly' manner that "one of the remaining areas we must address [in the BK process] is company-paid medical benefits and life insurance for retirees." This letter also informed you that "we will propose to the Retiree Committee appointed by the U.S. Bankruptcy Court changes to company-paid medical benefits and life insurance for retirees and surviving spouses of AA and TWA." Ms. Lynn's letter also stated that "talks with the Committee. . . will follow as a part of an ongoing process." In fact what AA management did on July 6th was to file an 1114 lawsuit against the Retiree Committee and request that they be allowed to argue in a hearing that the Debtors [AMR management team] have the unilateral right to modify retiree benefits forthwith.
The 1114 Retiree Committee forwarded a response to the Court dated July 12, 2012 which in part states "the Retiree Committee does not yet have access to the documents necessary to evaluate [AMR's] claims [made in the complaint] or in the previewed summary judgment motion." These said letters as well as the AMR Complaint can be found in full at the conclusion of this AMRRC Members Briefing.
On a more positive note AMRRC is pleased to announce that on July 9, 2012 APFA President Laura Glading appointed Jill Frank-Smoak as an additional APFA representative to the 1114 Retiree Committee. Jill will be working with Laura, Patrick Hancock (APFA's voting alternate Representative), the entire 1114 Retiree Committee and professional counsel. As you know, Jill has served as a board member of AMRRC since January, working with the other AMRRC retiree leaders who stepped forward following AMR's bankruptcy filing at the end of last year. This appointment, however, has required Jill's resignation from AMRRC's board.
This circumstance is a loss to AMRRC but certainly a gain to the 1114 Retiree Committee. You will find Jill's letter of resignation to the AMRRC Board dated July 13, 2012 at the bottom of this Members Briefing. AMRRC will offer suggested solutions to the 1114 Committee throughout this process. We look forward to their communication announcements during this challenging bankruptcy process.
The AMRRC Board is also pleased to announced that Jill did not leave her 'FA seat' unattended. Prior to her resignation Jill asked former APFA President and current AA FA retiree Tommie L. Hutto-Blake to take her AMRRC board seat and Tommie has agreed to do so for a limited time period until a qualified retired FA can be identified to serve on the AMRRC Board. Tommie has been an active AMRRC member since our organization formed and our Board looks forward to her continued involvement.
In closing, please note that the goals of AMRRC to protect the AMR retired employee benefits are unchanged by this now 'active stage' of the 1114 bankruptcy process. AMRRC will continue all means to protect the negotiated & established life time retiree benefits that we earned during our active service with our former employer. We signed our retirement papers with the understanding that we had very specific lifetime retirement benefits; some of which we had prefunded via payroll deductions during our active employment.
There are very recent court decisions [9th Cir. May 2012] that state in part "collective bargaining agreements in effect when the plaintiffs retired controlled and that those agreements did not give the employer the unilateral right to terminate benefits. . ." The history on AA's property is once negotiated by the unions the non-unionized work force subsequently receives the same benefits via company policy revisions.
There are over 40,000 retirees involved in this bankruptcy case, as well as any changes to retiree benefits that will ultimately impact the active employees who hope to retire one day. This is a fight that deserves the Courts full attention to the labor/management history on this property. The Court must give proper time to evaluate this history of just how these benefits were agreed to by the parties - all the facts from both sides of these complaints and counter complaints. It is time for the Court to pay full attention to the efforts of the 1114 Retiree Committee.
AMRRC stands ready to assist the efforts of the 1114 Retiree Committee as they follow this required court ordered mechanism to protect the life time retiree benefits earned during employment! The leadership of AMRRC encourages each of you to read in full the attached documents referenced in this AMRRC Members Briefing. We plan to remain totally involved in this bankruptcy case and to keep you, the AMRRC members - representing all employment workgroups, fully informed throughout
Visit us at www.amrcc.net.
Posts: 1402 | From: Hampton, NH and Naples, FL
| IP: Logged