16
In the Matter of the Arbitration Between __________________________ American Airlines Inc. And Allied Pilots Association and its AA and TWA Pilot Committees ________________________ Before the Arbitration Panel: Richard I. Bloch, Esq., Chair Stephen B. Goldberg, Esq. Ira F. Jaffe, Esq. APPEARANCES: For American Airlines: Thomas E. Reinert, Jr., Esq. P. David Larson, Esq. (Morgan, Lewis & Bockius, LLP) Michelle A. Peak, Esq. (Senior Attorney, American Airlines, Inc.) For the Allied Pilots Association: Edgar N. James, Esq. (James & Hoffman, P.C.) For the APA AA Pilots Committee: Wesley G. Kennedy, Esq. (Allison, Slutsky & Kennedy, P.C.) For the APA TWA Pilots Committee: John O’B. Clarke, Jr., Esq. (Highsaw, Mahoney & Clarke, P.C.)

In the Matter of the Arbitration Between American Airlines ...9-12-03).pdf · In the Matter of the Arbitration Between _____ American Airlines Inc. And Allied Pilots Association and

Embed Size (px)

Citation preview

In the Matter of the Arbitration Between __________________________ American Airlines Inc. And Allied Pilots Association and its AA and TWA Pilot Committees ________________________ Before the Arbitration Panel:

Richard I. Bloch, Esq., Chair Stephen B. Goldberg, Esq. Ira F. Jaffe, Esq.

APPEARANCES: For American Airlines: Thomas E. Reinert, Jr., Esq. P. David Larson, Esq. (Morgan, Lewis & Bockius, LLP) Michelle A. Peak, Esq. (Senior Attorney, American Airlines, Inc.) For the Allied Pilots Association: Edgar N. James, Esq. (James & Hoffman, P.C.) For the APA AA Pilots Committee: Wesley G. Kennedy, Esq. (Allison, Slutsky & Kennedy, P.C.) For the APA TWA Pilots Committee: John O’B. Clarke, Jr., Esq. (Highsaw, Mahoney & Clarke, P.C.)

American Airlines and APA and the APA AA Pilots Committee and Page 2 of 16 the APA TWA Pilots Committee (LOA 12-05) (Ruling on Contract Language)

OPINION

The Arbitration Panel issued its Opinion and Award in this matter on July 22,

2013. Pursuant to the procedures agreed to by all Parties, American Airlines, the Allied

Pilots Association, the APA AA Pilots Committee, and the APA TWA Pilots Committee

met thereafter to adopt contract language to implement this Panel’s Award. Pursuant to

the provisions of LOA 12-05, this Panel was vested with the responsibility to review the

language and approve it. With the consent of all Parties, the APA AA Pilots Committee

and the APA TWA Pilots Committee were provided with the opportunity to raise any

concerns or objections to the Panel prior to the Panel’s final ruling on contract language.

At the outset, it should be noted that this stage of the proceeding is not a vehicle to

reargue or reconsider our July 22, 2013 Award. That Award is final and the only matter

currently being considered is the approval of the specific contractual language that will

be adopted to implement our Award.

With the exception of one item that will be discussed below, as to which the

Company and the Association submitted to the Panel two possible alternatives (one

urged by the APA AA Pilots Committee, the other urged by the APA TWA Pilots

Committee), the Company and the Association agreed upon the language needed to

implement the Award. Submissions were received by the Panel, including comments by

the APA AA Pilots Committee and by the APA TWA Pilots Committee urging certain

modifications to the language that was agreed upon by the Company and the Association.

All submissions have been given appropriate consideration by the Panel prior to

its issuing its Award approving the contractual language that will be adopted to

implement our Award. All Parties were in agreement that the new language would be

designated as Supplement C and, accordingly, we will reference it as such hereinafter.

American Airlines and APA and the APA AA Pilots Committee and Page 3 of 16 the APA TWA Pilots Committee (LOA 12-05) (Ruling on Contract Language)

A copy of the language of Supplement C, as approved by the Panel, is attached to

this decision and is incorporated herein.

Given the time frames involved in issuing the Award in this matter, while the

Panel has considered all of the Parties’ positions, the Panel has elected to discuss those

matters in summary fashion.

We conclude that the language submitted by the Company and the Association

satisfactorily implements our July 22, 2013 Award. Generally, the final language

submitted to the Panel incorporated a number of the suggestions made by the APA TWA

Pilots Committee and by the APA AA Pilots Committee and also provided some

additional rights to the former TWA pilots that were not explicitly provided for by our

Award, but are consistent with its intent. Other requests fall into two different categories

in our view. The first set of requests seeks to have us reconsider items we explicitly ruled

on in our Award. We decline to do so for two reasons. First, it is not clear we have the

authority to reconsider items that were the subject of explicit ruling in the July 22, 2013

Award in the context of reviewing submitted language for approval. Second, even if we

had such discretion, we are unpersuaded that the requested changes are appropriate or

necessary. The second set of requests seeks to have us incorporate items that were not

explicitly part of our original Award. For similar reasons, we decline to modify the

submitted language to address those matters. We are unpersuaded that the proposed

additional language is either necessary to implement our original Award or appropriate

or necessary for adoption.

The lone remaining area of dispute relates to the language of Paragraph D.5. of

Supplement C – the provisions addressing the discretion provided to the Company to

transition protected TWA Pilot positions from the MD-80 aircraft to Airbus Group II

aircraft prior to the time there are insufficient MD-80 positions available due to the

retirement of MD-80 aircraft. The Award contained no specific limitation of when the

American Airlines and APA and the APA AA Pilots Committee and Page 4 of 16 the APA TWA Pilots Committee (LOA 12-05) (Ruling on Contract Language)

Company could exercise that discretion. American and APA could not agree on language

resolving this issue and requested the Panel to do so. The alternatives presented to us,

the first of which was supported by the APA AA Pilots Committee, the second by the APA

TWA Pilots Committee, were these:

APA AA Pilots Committee opinion: a. In order to provide for an efficient training and operational transition, the Company may

transition protected TWA Pilot positions from the MD-80 to Airbus Group II aircraft at the time that the MD-80 fleet size is forecast to be 120% (a 20% buffer) of that necessary to provide the required number of MD-80 protected CA positions.

APA TWA Pilots Committee opinion:

a. The Company, at its option and in order to provide for efficient training and operational transition, may meet the protected position guarantees with positions on domestic Airbus Group II aircraft prior to the time that there are insufficient MD80 positions available due to the retirement of the MD80 aircraft.

The Panel approves the language urged by the APA AA Pilots Committee for two

reasons. The metric included in the proposed language for triggering the possible

transition and training is one which the Company indicated made operational sense and

to which it had no objection. Moreover, the adoption of an objective trigger may well

avoid future disputes about an allegedly inappropriate exercise of discretion by the

Company.

American Airlines and APA and the APA AA Pilots Committee and Page 5 of 16 the APA TWA Pilots Committee (LOA 12-05) (Ruling on Contract Language)

For all of these reasons, we approve the Supplement C language attached to this

Award.

Issued this 12th day of September 2013:

STEPHEN B. GOLDBERG, Esq.

IRA F. JAFFE, Esq.

American Airlines and APA and the APA AA Pilots Committee and Page 6 of 16 the APA TWA Pilots Committee (LOA 12-05) (Ruling on Contract Language)

SUPPLEMENT C

AGREEMENT Between

AMERICAN AIRLINES, INC. and

THE AIR LINE PILOTS in the service of

AMERICAN AIRLINES, INC. as represented by

ALLIED PILOTS ASSOCIATION

THIS AGREEMENT is made and entered into in accordance with the provisions of the Railway Labor Act, as amended, by and between AMERICAN AIRLINES, INC. (“American” or the “Company”) and the AIR LINE PILOTS in the service of AMERICAN AIRLINES, INC., as represented by the ALLIED PILOTS ASSOCIATION (“APA” or the “Association”). WHEREAS, the Company filed Chapter 11 proceedings under the United States Bankruptcy code in the Southern District of New York on November 29, 2011, and WHEREAS, the Court subsequently approved the Company’s request to abrogate the Collective Bargaining Agreement then in existence between American and the APA on September 5, 2012, and WHEREAS, part of that abrogated Collective Bargaining Agreement was Supplement CC, a provision governing the seniority integration of the TWA Pilots and AA Pilots, and certain exceptions to the Agreement and certain fences and bidding rights for the TWA Pilots and AA Pilots, and WHEREAS, the Company and the Association entered into a new Collective Bargaining Agreement (“CBA”) which was ratified by the membership and became effective on January 1, 2013, and WHEREAS, that CBA includes a provision known as LOA 12-05 which establishes a dispute resolution procedure to determine what alternative contractual rights should be provided to TWA Pilots as a result of the termination of Supplement CC, and the potential closing of the STL pilot base, and WHEREAS, that dispute resolution procedure is a final and binding interest arbitration pursuant to Section 7 of the Railway Labor Act, and WHEREAS, the Award of the interest arbitration panel (the ‘Board”) was issued on July 22, 2013 providing for certain alternative contractual rights for the TWA Pilots,

American Airlines and APA and the APA AA Pilots Committee and Page 7 of 16 the APA TWA Pilots Committee (LOA 12-05) (Ruling on Contract Language)

WHEREAS, LOA 12-05 and the Award provide for the parties to enter implementing provisions to be made part of the CBA, NOW, THEREFORE, the parties hereby agree to the following terms, provided that the provisions of the CBA shall apply except as modified herein, and in the event of a conflict, the provisions herein shall apply: B. Definitions

1. For purposes of this Supplement, the terms “American” and “the Company” mean American Airlines, Inc. or its successor, including as provided in the Memorandum of Understanding among American Airlines, US Airways, APA, and USAPA.

2. For purposes of this Supplement, the term “TWA Pilot” means any American Airlines pilot on the System Seniority List who was hired by TWA with a date-of-hire on or before April 10, 2001, who had not left the employ of TWA prior to April 10, 2001, and who still retains seniority with the Company on the effective date of this Supplement.

3. For purposes of this Supplement, the term “AA Pilot” means any American Airlines pilot on the System Seniority List who was hired by American with a date-of-hire on or before April 10, 2001, who had not left the employ of American prior to April 10, 2001, and who stillretains seniority with the Company on the effective date of this Supplement.

4. The “effective date” of this Supplement shall be the first day of the contractual month after the date the language of this Supplement is approved by the Board under LOA 12-05.

5. For purposes of this Supplement, the term “CBA” means the Agreement between American and APA, effective January 1, 2013, as amended, including all Supplements, Appendices and Letters of Agreement.

6. For purposes of this Supplement, the term “small wide-body aircraft (SWB)” means an Equipment Group III aircraft operated by the Company, and a “protected” SWB position means a position on a B767-200, B767-300, or B-757designated for priority award to a TWA Pilot.

7. For purposes of this Supplement, the term “narrow-body aircraft (NB)” means an Equipment Group II aircraft operated by the Company, and a “protected” NB position means a position on a MD-80, (or Airbus 319/320/321 as provided for in Paragraph C.5 or 6), designated for priority award to a TWA Pilot.

8. For purposes of this Supplement, the term “large wide-body aircraft (LWB)” means an Equipment Group IV or Group V aircraft operated by the Company.

American Airlines and APA and the APA AA Pilots Committee and Page 8 of 16 the APA TWA Pilots Committee (LOA 12-05) (Ruling on Contract Language)

9. For purposes of this Supplement, a TWA protected Captain position

means one of 260 (or as adjusted by the provisions of Paragraphs C.6.a., D.4.a,,F.2, or F.3) narrowbody Captain positions, or one of the 86 small widebody Captain positions designated by the Company as a protected position and subsequently awarded and occupied by a TWA Pilot using his/her system seniority in accordance with Paragraph B. or Paragraph C. of this Supplement.

10. For purposes of this Supplement, a First Officer position “protected” for the TWA Pilots means one of the First Officer positions, on narrowbody or small widebody aircraft designated by the Company as a protected position in accordance with Paragraph B. or Paragraph C. of this Supplement. The number of such First Officer positions shall be equal to the number of protected narrowbody and small widebody Captain positions minus the number of large wide body First Officer positions occupied by TWA Pilots, as provided in Paragraph D.

11. For purposes of this Supplement, “counted position” means a non-

protected Group II through V Captain position, or a Group IV or V FO position, awarded by the exercise of system seniority to a TWA Pilot (and in the case of the LWB CA or FO position, awarded to a TWA Pilot senior to B.D. White) without any preference under this Supplement.

12. For purposes of this Supplement, the terms “STL” and “SLT” are interchangeable.

Except as otherwise may be provided in this Supplement, the parties intend that terms be defined in accordance with their meaning under the CBA.

C. Transition Implementation Provisions

1. This Paragraph B addresses the process for reducing the size of the STL base and the implementation of protected positions for TWA Pilots at locations other than STL.

2. The Company shall have an obligation to establish, and fill through vacancy bidding, protected NB and SWB Captain and First Officer positions, in the number and on the specific aircraft types provided by the Award and this Supplement that are designated protected for award to TWA Pilots. The number of protected positions shall continue for the duration of this Supplement, provided that the number of positions protected for bid by TWA Pilots may subsequently be reduced according to the terms of the Award and this Supplement, and provided further, that protected positions not bid by TWA Pilots may be filled by other pilots on the System Seniority List in accordance with the CBA.

3. The Company in its discretion will determine, based on available information and schedules, the number of positions to remain based in STL, if any. Any flying allocated to STL on Group II or Group III aircraft while these protections remain in effect will be protected for vacancy bid

American Airlines and APA and the APA AA Pilots Committee and Page 9 of 16 the APA TWA Pilots Committee (LOA 12-05) (Ruling on Contract Language)

by TWA Pilots and, when filled by TWA Pilots, will be counted toward the number of positions protected to TWA Pilots.

4. The Company in its discretion will also determine, based on available information and schedules, the crew bases to which the CA and FO positions protected for bid by the TWA Pilots will be assigned, and the number of protected positions to be assigned to each base.

5. Prior to implementation through displacement and vacancy bids, the Company will inform the airline’s pilots and the Association of the anticipated distribution of positions protected for bid by TWA Pilots. The information provided will also be available electronically and will include, at a minimum, base, category, and equipment type. Based on that projected distribution, the TWA Pilots will have an opportunity to bid, using system seniority:

a. to remain in the STL base, for the number of positions anticipated for a

reduced base or Home Base or

b. to participate in the vacancy run process to be awarded one of the protected positions at a different base,

c. to bid using system seniority to a position not designated as a protected vacancy. Pilots awarded positions to vacancies that are not designated as “protected” shall be counted as follows: (1) Pilots awarded a Group II CA position will be counted toward the

260 NB CA protected positions.

(2) Pilots awarded a Group III CA position will be counted toward the 86 SWB CA protected positions.

(3) TWA Pilots senior to B.D. White awarded a Group IV or V FO position will be counted toward the 260 NB CA protected positions.

6. Except for the initial implementation of the TWA Pilot protected positions

at STL with the reduction at that base, no AA Pilot will be displaced from a base or bid status to accommodate a TWA Pilot moving to a new protected position in a base.

7. The Company will consider all pilots currently based in SLT, who are changing bid status from SLT as a result of the implementation of Paragraph B of this Supplement, as qualified for moving expense provisions of Section 17.S.2 and Section 8 of the CBA. Pilots who complete a Company paid move under this paragraph will retain reinstatement rights to SLT and will not be subject to a lock in period. Furthermore, the affected pilots will have a period of one year, from the effective date of their non-STL bid status, to complete the Company paid move.

8. All pilots who leave a STL bid status, whether through preference or displacement award, will be provided a reinstatement right to their previous STL category status. STL pilots will also be provided a

American Airlines and APA and the APA AA Pilots Committee and Page 10 of 16 the APA TWA Pilots Committee (LOA 12-05) (Ruling on Contract Language)

reinstatement right to the STL MD80 CA and FO bid statuses. Furthermore, TWA Pilots with reinstatement rights will have preference to vacancies in STL over other pilots on the system seniority list for Group II and III aircraft.

9. Other than at STL, pilots will utilize their system seniority for all contractual provisions, including monthly schedule bidding, pick-up, TTOT/TTS and vacation bidding purposes. At STL, provided STL Group II or Group III aircraft flying remains protected for vacancy bid pursuant to the provisions of this Supplement, any other pilot holding such a position will bid for monthly line schedules in seniority order, but subordinate to all TWA Pilots in the same bid status.

10. Nothing herein shall prevent the Company from using a phased process to appropriately size the STL base, transition STL based aircraft to other locations, or to designate the locations and number of the protected positions elsewhere in the system. The Company may also implement these provisions by processing STL as a base closing for bidding purposes, or by performing a “Master Shuffle” or similar approach that allows all TWA Pilots to bid their preferences followed by a phased implementation. As a part of any “Master Shuffle” the Company will provide all TWA Pilots an opportunity to participate in a “trial run” in advance of the actual Master Shuffle in order to give those pilots a forecast of the “Master Shuffle” results. While the Company anticipates a transition to a reduced STL base or Home Base, there is no assurance that any pilot positions will remain based in STL for the longer term.

D. Filling of Future Vacancies in Protected Positions

1. This Paragraph C addresses the process for maintaining the required number of TWA protected positions after the transition of aircraft and pilots from STL to other bases and for the continued duration of this Letter of Agreement.

2. The Company shall have a continuing obligation to maintain, establish and fill through vacancy bidding, protected NB and SWB Captain and First Officer positions, in the number and on the specific aircraft types provided by the Award and this Supplement.

3. In the event of (a) a future vacancy in a protected position, (b) the Company continues to designate that position as protected, consistent with the terms of the Award, this Supplement, and the CBA, and (c) the number of protected and counted positions does not exceed the guaranteed number of positions for the relevant fence, then TWA Pilots will have priority to be awarded such a protected position using system seniority.

American Airlines and APA and the APA AA Pilots Committee and Page 11 of 16 the APA TWA Pilots Committee (LOA 12-05) (Ruling on Contract Language)

4. The Company shall determine the number, location, and aircraft type of such protected positions, consistent with the terms of the Award, this Supplement, and the CBA prior to filling any vacancy.

5. If, because of MD80 aircraft retirements, there are insufficient positions available to maintain the necessary number of protected positions on the MD80, the Company shall provide a sufficient number of Airbus Group II domestic CA positions to meet the necessary number of protected positions. a. In order to provide for an efficient training and operational transition,

the Company may transition protected TWA Pilot positions from the MD-80 to Airbus Group II aircraft at the time that the MD-80 fleet size is forecast to be 120% (a 20% buffer) of that necessary to provide the required number of MD-80 protected CA positions.

6. If insufficient SWB domestic flying is available to meet the necessary

number of protected SWB CA, the Company shall provide the TWA Pilot(s) with their choice of an International SWB protected position or a NB CA protected position. There need not be a vacancy available in either of those offered protected positions for a TWA Pilot to be awarded such. The choice of the affected TWA Pilot(s) will be made via the provisions of Section 17 of the CBA. a. In the event a pilot elects the NB CA position, the SWB CA guarantee

will be reduced accordingly and the NB CA guarantee will be increased accordingly, such that the total of 346 combined CA positions remains constant.

7. Over time, after all TWA Pilots have been offered a protected pilot position, the number of available TWA Pilots will become insufficient to fill all of the FO positions protected for TWA Pilots – both in the NB and SWB bid statuses. The required number of TWA protected FO positions offered will not be reduced. Any unfilled protected positions will be available to all pilots and filled via the provisions of Section 17 of the CBA.

8. Any Group I flying assigned to STL will be filled in accordance with the CBA. There shall be no preference for TWA Pilots for such flying. Group I CA positions will not be counted toward the protected CA positions, and the provisions of B.9 with respect to monthly bidding at STL shall not apply.

9. If the Company determines to continue STL as a smaller domicile or a Home Base, the relevant terms of the CBA will apply to that operation, except in so far as provided in Paragraph B.9. above for bidding at STL.

10. Nothing in this Supplement shall preclude a TWA Pilot from exercising his or her system seniority to bid for and be awarded any vacancy if eligible under the CBA.

American Airlines and APA and the APA AA Pilots Committee and Page 12 of 16 the APA TWA Pilots Committee (LOA 12-05) (Ruling on Contract Language)

E. Counting of Protected Positions

1. This Paragraph D sets forth the counting methodology with respect to protected positions that shall apply for all purposes under this Supplement, except as superseded by Paragraph B.

2. Any TWA Pilot holding a

a. CA position on a Group II aircraft, or

b. a FO position on Group IV or V aircraft, provided that the TWA Pilot is senior to AA Pilot B.D. White, DOH 4/9/01 (or in the event that B.D. White ceases to be on the System Seniority List, the remaining AA Pilot immediately senior to B. D. White)

while the NB protected position obligation remains in effect, will count toward the required number of narrowbody protected CA positions, regardless of whether the position was obtained by virtue of bidding for a protected position or through the use of system seniority in a vacancy bid.

3. Initially, the Company will establish the required number of protected NB First Officer positions in the same bases and numbers of protected NB CA positions.

4. Any TWA Pilot holding a CA position on a 767-200, 767-300, or 757, while the SWB protected position obligation remains in effect, will count toward the required number of protected SWB CA positions, regardless of whether the position was obtained by virtue of bidding for a protected position or through the use of system seniority in a vacancy bid. a. In the event that there are insufficient domestic SWB CA positions to

fulfill the required number of protected positions, the protected SWB CA(s) will be given a choice of either an international SWB CA position(s) designated by the Company, (to the degree such a bid status exists), or a NB CA protected position(s). The choice will be effected using the system vacancy process. In the event that he/she elects NB CA, the required number of NB CA protected positions will be increased, and the required number of SWB protected CA positions will be decremented accordingly. No current NB CA will be displaced as a result of this election.

5. Initially, the Company will establish the required number of protected SWB First Officer positions in the same bases and numbers of protected SWB CA positions.

6. A TWA Pilot holding a protected CA position who exercises system seniority to an unprotected FO position, on other than a Group IV or V aircraft for a TWA Pilots senior to B.D. White, will no longer count toward satisfying the number of protected CA positions.

7. In the event that the actual number of counted protected positions exceeds the guaranteed number, no displacement will be automatically effected to bring the number back to the guaranteed number of protected

American Airlines and APA and the APA AA Pilots Committee and Page 13 of 16 the APA TWA Pilots Committee (LOA 12-05) (Ruling on Contract Language)

positions. However, the pilots in a protected bid position, where the actual number of counted protected positions exceeds the guaranteed number, are subject to the normal displacement provisions of Section 17 of the CBA, but only to the extent that the displacement(s) brings the number back to the guaranteed number of protected positions. Attrition in the protected positions, where the actual number of counted protected positions exceeds the guaranteed number, will not result in vacancies being offered exclusively to TWA Pilots until the actual number of protected positions is less than the guaranteed number of protected positions.

TWA Pilot Counted Positions Applicability Chart TWA Pilot bid status NB CA SWB CA CA Group I aircraft CA S80 ! CA 737 ! CA 320 ! CA 767 ! CA Group IV aircraft ! CA Group V aircraft ! FO Group IV aircraft ! FO Group V aircraft !

F. Duration

1. The alternative protections awarded as a result of the LOA 12-05 Arbitration shall continue in effect for the same period as the current AA-APA agreement. The “current AA-APA agreement” includes the Merger Transition Agreement (MTA) and the Joint Collective Bargaining Agreement (JCBA) as specified in the Memorandum of Understanding Regarding Contingent Collective Bargaining Agreement (“MOU”).

2. This Supplement may not be amended prior to January 1, 2019, and may be changed thereafter in accord with the procedures for changing the terms of the AA-APA Agreement as set forth in that Agreement and the Railway Labor Act.

3. All guarantees and preferences related to SWB positions will end as of the date Morgan Fischer, DOH 9/28/90 (or, in the event that Morgan Fischer ceases to be on the System Seniority List, the remaining TWA Pilot immediately senior to Morgan Fischer) has sufficient seniority to hold a four part bid status as CA on a Group III aircraft anywhere in the AA system.

4. All guarantees and preferences related to the NB CA positions (MD-80 or domestic Airbus Group II aircraft) will end as of the date that Magnus

American Airlines and APA and the APA AA Pilots Committee and Page 14 of 16 the APA TWA Pilots Committee (LOA 12-05) (Ruling on Contract Language)

Alehult, DOH 7/17/97 (or, in the event that Magnus Alehult ceases to be on the System Seniority List, the remaining TWA Pilot immediately senior to Magnus Alehult) has sufficient seniority to hold a four part bid status as CA on any aircraft.

5. In the event that the guarantees related to the NB CA positions terminate under Paragraph 4 above, while the protected positions related to SWB CA remain in effect, the total number of remaining protected CA positions shall revert to 86. In this event the senior most 86 TWA Pilots holding SWB CA, NB CA, and/or LWB FO positions shall be those pilots who count towards the remaining 86 protected positions. All guarantees and preferences related to these remaining 86 protected CA positions will end as of the date Morgan Fischer (described in E.3 above) has sufficient seniority to hold a bid position held by any the 86 pilots.

G. Other Considerations

1. There will be no system flush following the date(s) on which the guarantees and preferences provided for in this Letter of Agreement end. All vacancies will be filled thereafter in accord with the procedures contained in the CBA.

2. In the event that MD80 aircraft are retired without sufficient replacement Airbus Group II domestic aircraft to support the required number of protected NB CA positions, and there is a reduction in force of AA pilots in CA positions on Group II aircraft from that which existed on the Effective Date, there will be made, on a proportionate basis, a reduction in the number of protected NB CA positions for TWA Pilots. In the event that additional Group II CA positions are created thereafter during the life of the guarantees and preferences directed by the Award and outlined in this Supplement, then until the required number of protected NB CA positions is reached, any new CA positions in Group II aircraft will also be awarded on a proportionate basis between TWA and AA pilots. All other provisions of the CBA regarding reductions in force will remain applicable.

3. In the event that B757/767 as well as MD80 aircraft are retired without sufficient replacement Airbus Group II domestic aircraft to support the required number of protected SWB CA positions, and there is a reduction in force of AA pilots in CA positions on Group III aircraft from that which existed on the Effective Date, there will be made, on a proportionate basis, a reduction in the number of protected SWB CA positions for TWA Pilots. In the event that additional SWB CA positions are created thereafter during the life of the guarantees and preferences directed by the Award and outlined in this Supplement, then until the required number of protected SWB CA positions is reached, any new SWB CA positions in

American Airlines and APA and the APA AA Pilots Committee and Page 15 of 16 the APA TWA Pilots Committee (LOA 12-05) (Ruling on Contract Language)

eligible aircraft will also be awarded on a proportionate basis between TWA and AA pilots. All other provisions of the CBA regarding reductions in force will remain applicable.

4. The Company shall be free to utilize limited pay protection for transitional situations, in accordance with the provisions of the CBA.

H. Force Majeure

1. If the Company is unable to satisfy the protected positions due to

conditions beyond the Company’s control, then the Company will be exempted from the requirement to provide the number of protected and guaranteed positions for the period of time necessary to rectify the situation, if the Company is taking all practicable steps to restore operations, including by repairing or replacing the affected aircraft.

2. “Conditions beyond the Company’s control” shall include, but not be limited to, the following: a. an act of God, b. a strike by any other Company employee group or by the employees of

a Commuter Air Carrier, operating pursuant to Section 1.D. of the CBA. c. national emergency, d. involuntary revocation of the Company’s operating certificate(s), e. grounding of a substantial number of the Company’s aircraft, f. a reduction in the Company’s operation resulting from a decrease in

available fuel supply caused by either governmental action or by commercial suppliers being unable to meet the Company’s demands,

g. the unavailability of aircraft scheduled for delivery.

I. American Airlines / US Airways Merger 1. The Memorandum of Understanding among American Airlines, US

Airways, APA, and USAPA provides at Paragraph 10.i that: “Nothing in this paragraph 10 shall modify the decision of the arbitration panel in Letter of Agreement 12-05 of the 2013 [2012 sic] CBA.” Accordingly, any subsequent agreement or arbitration with respect to integration of seniority or a collective bargaining agreement covering all pilots at any merged operation will not serve to modify the alternative guarantees and preferences awarded in this matter by the Panel.

J. Reporting 1. During the period this Supplement is in effect, the Company will prepare a

compliance summary report each month, showing TWA Pilots who represent a protected and/or counted pilot bid position in accordance with this Letter of Agreement. The report will be made available electronically

American Airlines and APA and the APA AA Pilots Committee and Page 16 of 16 the APA TWA Pilots Committee (LOA 12-05) (Ruling on Contract Language)

and will identify each pilot by name, employee number, system seniority number and four-part bid status.

K. Dispute Resolution

1. Pursuant to the terms of LOA 12-05, the Board shall continue to have

jurisdiction of any disputes arising under LOA 12-05 and the interim terms with respect to the STL operation that applied prior to the effective date of this Supplement. The Board shall have jurisdiction to review and approve the language of this Letter of Agreement and to determine whether such language conforms with the meaning of its Award. All other disputes following approval of the language of this Supplement will be handled in accordance with the CBA, Sections 21, 22, and 23. If available, Richard Bloch shall sit as the neutral member of the System Board for disputes arising under this Letter of Agreement. If Richard Bloch is unable or unwilling to serve, the parties will select the first available date from either Stephen Goldberg or Ira Jaffe, the other two members of the LOA 12-05 Interest Arbitration Panel. In the event that neither of them is willing or able to serve, the arbitrator selection procedures of Section 23 of the CBA will be utilized to select an arbitrator.