A Dallas-based legal advocacy group sent a letter to American Airlines (AA) on Tuesday demanding that the company retract hiring and other policies explicitly based on race within 30 days.
The letter appears to be addressed to the directors and officers of AA and informs them that their knowledge, established by the letter, of the illegality of these policies would likely void the indemnity clauses enjoyed by such agents of the organization when faced with legal challenges.
The American Civil Rights Project (ACR Project) reportedly wrote the letter on behalf of AA shareholders, to include the National Center for Public Policy Research (NCPPR), according to Dan Morenoff, the executive director of the ACR Project.
The letter states that if within 30 days of receipt, no response is received, “the Stockholders will be forced to seek judicial relief to protect American and the Stockholders’ interests in the company from your continued breaches of your fiduciary duties.”
This may set up a high-profile legal dispute, as the airline has admitted that it weighs race as a factor in hiring and in contracting, according to materials reviewed. In a shareholder meeting last June, the NCPPR reported that AA CEO Doug Parker said the airline “absolutely” weighs “diversity, equity, and inclusion” in its hiring process for pilots.
“One of our focal points is to confront companies, especially iconic companies such as American Airlines, that violate the law,” Morenoff said. “AA policies inject race into the company’s internal and external contracting.”
Morenoff said those policies violate state laws and Title VII of the Civil Rights Act of 1964. He said the company rewarded members of its leadership team based on progress toward racial goals in hiring to “ensure the diversity of [its] team reflects the diversity of [its] customers.”
“None of this is legal,” Morenoff told The Dallas Express. “American Airlines is American Airlines and should know better than putting its name at risk with stockholders and potential employees.”
In 2021, AA’s annual hiring quotas included increased requirements for one racial demographic already overrepresented in the company’s workforce relative to the total population, the ACR Project said in a news release.
In 2022, the Fortune 500 company deemed progress toward racial quotas a factor in the calculation of executive compensation packages, according to the ACR Project.
Scott Shepard, director of the Free Enterprise Project at NCPPR, said hiring and promoting on merit is a hallmark of publicly traded companies.
“Hiring pilots and other aviation personnel on any other basis is not just illegal and a breach of duty to shareholders and the flying public; it is quite frankly insane,” Shepard said in the news release.
“AA must not only end these programs immediately but put transparent policies and procedures in place to make sure that merit is the only metric it uses in any employment-related decision or process,” he added in the statement.
Further, according to the letter, AA also committed to race-based contracting in violation of settled contract law. The press release describes American’s commitment to reshaping its supply chain through a Supplier Diversity Program “that qualifies vendors based on the race, sex, and gender of their ownership.”
The Dallas Express reached out for comment from American Airlines. The company did not respond by the publication deadline.
The company’s official website contains a page about pilot credentials. The description falls under the headline, “It’s Not Just What We Do, It’s Who We Are,” and explains the company’s need for “safe, professional, skilled” pilots.
“Our pilots are not only leaders on the aircraft — they are also leaders in our operation,” the page states. “That requires a special type of person, someone who can anticipate a need, develop a plan and draw all the necessary players together to make it happen.
“Whether you’re ready to be hired now or just figuring out where you want to land, look to American.”
AA’s stock price was $16 a share at the close of business Tuesday. The company was valued at $55.5 billion in December 2021.
The ACR Project has a history of confronting companies that operate with similar policies. The group previously wrote letters to Coca-Cola and Lowe’s and helped reverse hiring practices based on race and sex, Morenoff said.
“I hope American Airlines will read our letter and reverse its policies,” Morenoff told The Dallas Express. “I expect a lawyer will write us back, saying they will look into it, then stall.”
