INDIANAPOLIS (AP) -- Union leaders representing ATA Airlines' pilots have endorsed a new contract that gives the pilots partial ownership of the airline in exchange for wage concessions and clears the way for a membership vote on the proposal, the union said.
Rusty Ayers, a spokesman for the Air Line Pilots Association, said Monday that a majority of the 12 members of the union's master executive council voted for the deal on Saturday.
As a result, 800 pilots and flight mechanics of the bankrupt airline are to start voting on the proposal Tuesday morning, with balloting ending Sept. 28, two days before the current tentative agreement expires, he said.
Under the three-year deal, Ayers said ATA pilots would receive 4 percent ownership of the Indianapolis-based airline company in the form of stock options.
It also provides for slightly higher pay, better work rules and fewer cuts in health and retirement benefits than a plan he said ATA submitted to a U.S. Bankruptcy Court in Indianapolis to replace the existing agreement.
''What we negotiated was something that was better for us than what the company wanted to impose on us,'' Ayers said.
If ratified, the new concessions package would cost ATA's pilots $84.5 million (euro69.6 million) more in concessions by the end of 2007, he said. The contract would be the fourth time in 15 months the pilots have agreed to concessions to help the company, Ayers said.
Last week, the union said its members had voted to authorize a strike. After that vote, union and company officials resumed negotiations.
In a statement, ATA President and CEO John Denison said an approved contract would allow the airline to stay on course to emerge from bankruptcy by the end of the year or in early 2006.
Richard Meyer, ATA's senior vice president of labor relations, said a new contract would let investors ''see ATA as a much stronger and stable'' company as it seeks another $100 million (euro82 million) in capital to complete its restructuring.
ATA, which is owned by ATA Holdings Corp., filed for Chapter 11 bankruptcy protection in October 2004. It has cut about 3,100 jobs since it began downsizing from a work force of 7,800 people two years ago.
Industry experts have said a pilot walkout would quickly lead to the demise of the 32-year-old carrier.
ATA, once the nation's 10th-largest carrier, flies to 28 cities in the U.S., Aruba and Mexico. It operates a hub at Chicago's Midway Airport and is the largest North American operator of commercial and military charters.
Copyright 2005 Associated Press