American Airlines and a subsidiary will pay $9.8 million in stock to settle claims that they failed to help disabled employees return to work.
Federal officials say American and Envoy Air fired or put some workers on unpaid leave instead of making reasonable efforts to reassign them.
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The workers' disabilities ranged from cancer to back and knee injuries.
A lawsuit and consent agreement were filed Friday in federal court in Phoenix by the U.S. Equal Employment Opportunity Commission for 12 named former workers and others in similar circumstances.
The agency says violations of the 1990 Americans with Disabilities Act occurred from 2009 until August 2015.
American spokesman Matt Miller said the policies were legacies of carriers that merged with American, which then worked to "harmonize legacy policies" with present standards.