June 27, 2012 / 10:44 PM / in 5 years

American Airlines, pilots reach tentative contract

(Reuters) - Pilot union leaders at American Airlines reached a tentative agreement with management on Wednesday on a steep cost-cutting contract aimed at heading off a threat by the carrier to abandon the current deal in bankruptcy and impose stricter terms.

American Airlines aircraft stand on the tarmac at Los Angeles International Airport in Los Angeles April 20, 2012. REUTERS/Lucas Jackson

The Allied Pilots Association board voted 9 to 7 to send the last and best offer to its membership for consideration, the union and the company said.

A vote by members is expected in coming weeks, prompting the judge overseeing American’s case in New York to postpone a ruling that had been scheduled for Friday on whether to allow the airline to abrogate the pilots’ contract, the airline said.

The deal was revisited over the past several days after union board members rejected a previous proposal from American’s parent, AMR Corp AAMRQ.PK.

Details of the tentative deal were not released.

Proposed terms released over the past few days included $315 million in annual cost savings, no layoffs, a gradual pay raise, and an offer to freeze the union’s pension plan, rather than terminating it to save money.

Reporting by Nick Brown and John Crawley; Editing by Gary Hill

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