American Airlines to eliminate 200 pilot jobs

American Airlines is cutting 200 pilot jobs as it sheds 8 percent of its work force to cope with higher costs for jet fuel.

American, the nation's largest airline, gave its pilots union a plan Tuesday that includes incentives for senior pilots to leave voluntarily.

A spokesman for the Allied Pilots Association said the union needed time to review the proposal. American has about 8,500 pilots.

The pilots' union had hoped to avoid any job cuts, noting that the airline recalled about 25 pilots in June. But at a contract-bargaining session Tuesday, executives notified union representatives of the reductions.

"They have the opportunity to properly man the airline instead of undermanning it," said union spokesman Karl Schricker. "We think (the job reductions) should be zero."

Tim Wagner, a spokesman for American, a unit of Fort Worth-based AMR Corp., said "any pilot reductions are regrettable, but the current economic environment is forcing us to make adjustments throughout the company."

Executives told employees two weeks ago that they planned to eliminate 8 percent of the work force at American and sister carrier American Eagle, or about 6,800 jobs, when the airline reduces flights after the peak summer travel season.

They have indicated that up to 900 flight attendant jobs will be eliminated beginning Aug. 31, and have filed notices to cut several hundred jobs at airports around the country.

Flight attendants, who have their own union, and ground workers represented by the Transport Workers Union, reached agreement with the company on severance offers for older employees. American also has provisions for letting employees take leaves of absence.

Wagner said the company's proposal to the pilots union would give financial incentives for senior pilots who "may be ready to voluntarily leave" while giving younger counterparts a chance at advancement.

If enough pilots take the offers, the company could avoid layoffs, he said.

The stock market swoon could also make layoffs less likely because part of the pilots' pension plan fluctuates with the market.

A clause in the union's contract lets pilots lock in the value of their retirement benefits for 90 days by filing for retirement. At the end of the 90 days, if the market has recovered, pilots can rescind their retirement.

After another stock market slump, 143 pilots retired in February.

Wagner said the recent market decline could result in "an unusually high number of early retirements" in August and September. He said the airline considered this when setting pilot-staffing needs.

AMR shares fell 6 cents, to $4.41, after dropping to a 52-week low of $4 earlier Tuesday.