American Airlines Personnel Running head: AMERICAN AIRLINES PERSONNEL MATTERS


American Airlines Personnel Matters Embry Riddle AU

American Airlines Personnel Matters American Airlines is the world’s largest airline and employs over 85,000 people worldwide (PR Newswire, 2005). Over 13,000 of these are pilots with 2,819 of them on furlough (military leave of absence since shortly after the September 11, 2001 attacks). The average pilot’s salary at the major airlines is approximately $120,000 and goes as high as $200,000 (Aviation World, 2005). The Allied Pilots Association (APA) serves as the certified collective bargaining agent for all America American pilots. APA provides all of the traditional union representation services for its members. This includes the lobbying of airline pilots views to Congress and government agencies. In addition, it devotes more than 20 percent of its dues income to support aviation safety (Allied Pilots Association, 2005). The Association of Professional Flight Attendants (APFA) is the largest independent Flight Attendant union in the nation. It represents more than 25,000 Flight Attendants at American Airlines, including 4,240 Flight Attendants who have been on furlough following the events of 9/11 (PR Newswire, 2005). Founded in 1934, the Transportation Workers Union (TWU) represents nearly 125,000 workers in the nation’s transportation industries, including 55,000 workers in the airline and government service industry in virtually all Class and Crafts. The Airlines Division represents 42 Locals 59 labor contracts (PR Newswire, 2005). Maintenance of the airplanes is very important and a continuous process. American Airlines has maintenance stations (contracts) in many parts of the world, United States, Mexico, Japan, Switzerland, and Germany. The maintenance arena is composed of mechanics, Airframe engineers, Avionics engineers, and Engine engineers to mention a few (ATI – Airlines Profile, 2005).

Based on the 85,000 employees and approximately 695 aircraft in service, the ratio of personnel to aircraft is 122 personnel to one aircraft. As of the day of this writing, I could not find any information that would indicate how many pilots have been hired within the last two years. However, as of May 2003, about 2,500 American Airline pilots have lost their jobs, some through retirement, as part of the union’s $660 million in annual concessions to save the company from bankruptcy. In addition, pilot’s salaries have been slashed between 17 and 23 percent in the last three years. These layoffs are affecting about 21 percent of American’s pilots and will be based on seniority (CBS News, 2005). Employee Stock Ownership Plan (ESOP) is a defined contribution benefit plan that allows employees to become owners of stock in the company they work for. It is equity based deferred compensation plan. The ESOP operates through a trust, setup by the company that accepts tax deductible contributions from the company to purchase company stock. The contributions made by the company are distributed to individual employee accounts within the trust. The amount of stock each individual receives may vary according to pre-established formulas based on salary, service, or position. The employees may ‘cash out’ after vesting in the program or when they leave the company. The amount they may cash out may depend on the vesting requirements. Employees receive the vested portion of their accounts at either termination, disability, death, or retirement. These distributions may be made in a lump sum or in installments over a period of years. If employees become disabled or die, they or their beneficiaries receive the vested portion of their ESOP accounts right away (HR Guide to the Internet, 2005). In aviation human error is closely associated in the eyes of the public with incidents and accidents. Furthermore analyses of aircraft operating problems which have been reported,

notably through the Federal Aviation Administration (FAA), show that many of these problems can be classified in terms which are familiar with an ergonomist. These would include social and communication skills; planning, problem solving and decision making; role perception; workload distribution; human performance; control and displays; documentation; human error; and so on. Much airline attention has been focused on what is called management of flight deck resources. Many airlines, with considerable encouragement from the FAA are emphasizing the management of flight deck resources through formal courses in crew resources management (CRM). This course deals with both attitudes and behavior of crewmembers as a team and ensures that all involved are aware of the problems that could cause an incident or accident. Another area of concern from the FAA is with respect to crew proficiency training. This type of training program utilizes flight simulators and highly structured scenario to reflect a total line operational environment. It is called Line-Oriented Flight Training (LOFT). This is a training activity in which errors are allowed to occur, as they would do on a real flight (Hawkins, 2001). The American Airline Flight Academy is an institution dedicated to the safety of air travel. It is recognized by the aerospace industry as one of the finest flight training facilities in the world. Inside the Academy are learning centers, classrooms, flight simulators, a student service center, a safety research center, and the administrative offices of American’s Flight Department. The Academy is geared to the computer age. It contains the world’s most effective visually-equipped airplane simulators that “fly” millions of miles each year, but never leaves the ground. The simulator fleet includes one Boeing 727, three Boeing 767s, six McDonnell Douglas MD80s, one A300 Airbus, three Boeing 757s, one Boeing 757 fixed base, two Fokker 100s, a Fokker 100 fixed base, five B737-800 and three B777-200 simulators. Amercan also has several

American Eagle simulators and Cabin Emergency Evacuation Trainers including an ATR 42, a SAAB 340B and two ERJ 145 (WATS, 2005). Taking in consideration the aftermath of 9/11, American Airlines is trying to do its best as a major airline to remain competitive. In addition, the airline is ensuring that customer satisfaction remain high by providing the best services as budget can allow and still maintain low cost. Furthermore, it is providing the best benefit plans for the employees. .

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