AMR Corp.'s American Airlines said today it would switch from terminating pensions to freezing them for most employees, seeking to hasten agreements on $1.25 billion in concessions sought in bankruptcy.

The Transport Workers Union, the largest labor group at American, reached a tentative agreement on the freeze after it was offered. American said it will seek additional capital to fund the frozen pensions, without being more specific. The freeze doesn't apply to pilots.

American has made little progress in talks with its unions since proposing concessions on Feb. 1, and has warned the clock is ticking on securing consensual agreements. Labor givebacks and work-rule changes are a key part of a plan to cut costs by $2 billion a year and raise an additional $1 billion in revenue as parent AMR restructures after filing for Chapter 11 Nov. 29.

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