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Arizona Company on the Chopping Block in American Airline’s Bankruptcy Plan

Posted on: May 5, 2012

The financial disaster currently swirling around American Airlines has hundreds of employees in an Arizona call center worrying if they will have jobs in the near future. In an effort to cut their spending on labor, American Airlines is proposing to eliminate over 1,000 jobs and close a reservation center in Arizona. The cost cutting is expected to save the company $1.25 billion, enough to help stave off collapse.

The bankruptcy has been a source of contention. American Airlines has been embroiled in a dispute with some of the labor unions that represent its employees. The airline attempted to convince a judge to allow it to void its current union contracts and impose new contracts to ensure that its cost-saving measures were protected. American argued that if it could not void the contracts, the company would not be able to survive and all of the union employees would be without a job. Until this matter is resolved, the company cannot move forward with cost cutting measures designed to give the company breathing room while attempting a merger with US Airways.

The restructuring plan involves outsourcing jobs at airports that have the fewest number of flights. Airports in the following cities will likely be affected: Hartford, CT; Columbus, OH; Memphis, TN; Ontario, CA; Sacramento, CA; Portland, OR; and Reno, NV as well as airports in Calgary and Vancouver, Canada.

The reservation call center in Tucson, Arizona will unfortunately be closed permanently. About 700 of the agents that work at that location will be given an opportunity to take a new position or to work from home. Additionally, 800 agents will move from working in the office to working from home. Several part-time positions will be completely eliminated.

American Airlines’ bankruptcy attorneys are hard at work in federal bankruptcy court to save the company from total destruction. However, large businesses are not the only ones who need the advice of experienced counsel while going through the difficult bankruptcy process. If you are considering filing for bankruptcy and need some guidance, contact the skilled Phoenix bankruptcy attorneys at Ariano & Reppucci, PLLC. Call today at (602) 515-0841.

Source: “AMR Cuts 1,200 More Jobs in $1.25B Savings Plan,” by Mary Schlangenstein, published at Businessweek.com.

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