Release #: 20.17
June 25, 2020

ALPA Applauds Bankruptcy Reform Legislation, Hails Measure as Key Plank in Broader Worker-Protection Effort


MCLEAN, Va.—The Air Line Pilots Association, Int’l (ALPA) today applauded the introduction of the Protecting Employees and Retirees in Business Bankruptcies Act of 2020 as a critical step forward in the union’s broader worker-protection campaign. If enacted, the legislation would prohibit businesses from using the judicial process to alter airline employee collective bargaining agreements in bankruptcy. The bicameral measure, introduced by Sen. Richard Durbin (D-IL) and Rep. Jerry Nadler (D-NY), comes a week after ALPA called for additional measures to save aviation jobs and ensure the economic recovery of the airline industry.

“Airline workers know far too well the devastating effects corporate bankruptcies have on the lives of hardworking Americans. Following 9/11, pilots made enormous financial sacrifices to help save our airlines, only to have tens of billions of dollars taken from us in pension and health-care cuts, as well as other negative forced changes, lasting years longer than the crisis,” said Capt. Joe DePete, ALPA president. “We are grateful to Sen. Durbin and Chairman Nadler for their leadership in bringing forth this comprehensive reform legislation that will prevent a repeat of that sad chapter in our history, provide much-needed transparency to the bankruptcy process, and benefit U.S. workers.”

A key provision of the bankruptcy reform bill would prohibit airlines from using the bankruptcy process to gut collective bargaining agreements. Airlines have abused this process, despite clear evidence that Congress never intended this outcome. As a result, after 9/11 airlines were able to use the courts to squeeze $84 billion in wage and benefit reductions, the dissolution of nearly every defined benefit pension plan, and in some cases dictate 50 percent pay cuts and seven-year contracts in order to cement long-term employee losses. These draconian cuts would have never been achieved at the bargaining table, were grossly disproportionate in substance and duration, and did not reflect economic circumstances. By providing a technical correction, Congress will restore the intent of equitable airline employee treatment in Chapter 11 reorganizations.

“Pilots remain committed to working with management to weather this current public health and economic crisis. However, history shows that airline executives exploited the bankruptcy process to get the most for themselves while leaving frontline workers with the bill—and we will not allow that to happen again. Airline pilots today are still feeling the effects of the last round of bankruptcies that stripped them of their hard-earned pensions, salaries, and work rules. ALPA pilots stand in strong support of this important legislation that will provide much-needed protections for all U.S. workers,” added DePete.

In addition to calling for bankruptcy reform, ALPA last week urged Congress to:

  • Extend the CARES Act worker support program or other financial instruments directed toward worker payroll and benefits beyond October 1 to ensure the stability of the airline industry and a robust rebound to passenger travel;
  • Ensure health-care coverage for frontline workers, including COBRA subsidies for airline and other workers displaced as the result of industry downturn due to the pandemic;
  • Provide hazard pay for essential workers; and
  • Extend sick leave, unemployment benefits, and furlough mitigations related to COVID-19.

Founded in 1931, ALPA is the largest airline pilot union in the world and represents over 63,000 pilots at 34 U.S. and Canadian airlines. Visit the ALPA website at alpa.org or follow us on Twitter @WeAreALPA.

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CONTACT: ALPA Media, 703-481-4440 or Media@alpa.org