Filing for Chapter 11 bankruptcy is one way to restructure a business and keep the doors open. Tennessee business owners who are struggling in these tough economic times should learn about their options for debt relief and which kind of bankruptcy is right for them.
The story of American Airlines' bankruptcy continues to make headlines as the company strides to emerge from Chapter 11. The airline giant recently got some good news when a federal judge approved the elimination of the pilots' union contract. American Airlines had already negotiated away some concessions previously enjoyed by the flight attendants and other employees, but this new decision will allow the airline to lower payroll for pilots as well.
The news maybe isn't so great for the pilots, for whom the ruling wasn't really a surprise. But from a business perspective, the judgment is bound to help American Airlines successfully restructure the company and get out of Chapter 11.
There are approximately 7,500 pilots who will be affected by the ruling, and a spokesperson for American Airlines indicated that the company wants to create new contracts with those pilots. The company is reportedly eliminating and lowering other expenses where possible, and a merger with US Airways Group may also be on the horizon.
Although the business bankruptcy process can be a stressful time for everyone involved, the overarching goal is a stronger financial future. The American Airlines story illustrates some of the tough decisions business owners may have to make in the process of reemerging on steadier financial footing.
Source: wmctv.com, "Bankruptcy judge throws out AMR pilots' contract," Scott Mayerowitz, Sept. 4, 2012