Exclusive: AMR Ground Workers Would Get 4.3% Raises in Merger

Tickers in this article: AAMRQ.PK LCC

CHARLOTTE (TheStreet) -- In one more indication that a merger between US Airways (LCC) and bankrupt AMR (AAMRQ.PK) is moving ahead, ground workers at American have become the latest work group to be promised a raise if the merger occurs.

The 21,000 Transport Workers Union members at American would receive 4.3% increases if the merger, widely expected to be announced in February, takes place, union leaders told members gathered at American's Tulsa, Okla., maintenance base on Monday morning. The merger was previously widely expected to be announced in January. TWU, the largest union at American, represents fleet service workers, mechanics and other ground workers.

The increase is laid out in a memo of understanding between the union, the two airlines and American's bankruptcy creditors.

"We are pleased American has reached a three-party (MOU) with the Transport Workers Union and US Airways, the terms of which will only become effective in the event of a merger," AMR said Monday, in a prepared statement. "The MOU was reached to give the parties greater clarity on both the costs and integration processes associated with a potential merger with US Airways."

Flight attendants at American, represented by the Association of Professional Flight Attendants, signed a MOU in January. The Allied Pilots Association, representing American pilots, has agreed to an MOU expected to add $522 million in wages and benefits over six years to a contract agreement, reached in December, for a stand-alone American.

Pilots at US Airways, represented by the US Airline Pilots Association, are voting on an MOU that would boost their wages and benefits by an estimated $1.6 billion. It is expected to pass in voting that ends Feb. 8, although some pilot leaders have reportedly spoken against it.

The 4.3% increase for TWU members would exceed the wages in TWU contract agreements, approved by the bankruptcy court in August, for a stand-alone airline.

-- Written by Ted Reed in Charlotte, N.C.

>To contact the writer of this article, click here: Ted Reed