American Airlines lost a court battle in its effort to block a union election vote by nearly 10,000 passenger service agents.
Wednesday's decision by the 5th US Circuit Court of Appeals in New Orleans came amid a separate dispute between the airline's 8,000 pilots and its parent company, AMR. The pilots are expected to approve a strike later this week.
The appeals court ruling reverses an earlier decision by District Judge Terry Means in Fort Worth, Texas that blocked the agents' union election from going forward.
The Communications Workers of America, which is seeking to represent the agents, welcomed the appellate court's ruling and said in a statement the agents had been prevented from voting on whether to organize "for far too long."
Representatives for American Airlines had no immediate comment.
American Airlines sued the National Mediation Board in May after the federal agency authorized the union election.
The lawsuit asserted that the agency had authorized the election based on an outdated standard for deciding if there was enough support by workers to unionize.
A law that took effect in February raised the proportion of employees required to sign cards stating they wanted a union vote to at least 50 percent, up from 35 percent.
Judge Means blocked the election in June, finding that the 50 percent standard applied to the CWA's application to represent the agents.
But in a two-page order, a three-judge panel of 5th Circuit said the trial court "erred in exercising its jurisdiction." The court said review of National Mediation Board decisions is only warranted when the board has committed "egregious error."
The National Mediation Board will now need to schedule a new vote, said Chuck Porcari, a CWA spokesman. The vote had initially been scheduled for between June and August 2012, he said.