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US Airways MEC Merger Committee Update - September 12, 2007
Since the Nicolau Award was issued, efforts have been proceeding on two fronts to address the Award. While you have been getting numerous updates about individual activities, the Merger Committee would like to take the opportunity to bring it all together and give you an overview of where we are and where we’re headed.
As we discuss these issues, it is important to keep in mind that there are four parties involved: the AAA and AWA Pilots, ALPA International and Management. Each of these parties have very specific goals.
The AWA Pilots want the award implemented ASAP in order to capture US Airways Pilots jobs vacated by attrition. For every five pilots who retire, four of them are US Airways Pilots and they view these jobs as lost opportunities as each day goes by. The US Airways Pilots want the award vacated, but for now, we are capturing our own attrition evidenced by the recalling and hiring of pilots that has been taking place. ALPA International would like to see a settlement, through negotiations, which is why the Rice Committee was established. The Association is also wrestling with the decertification effort. As for management, while they once threaten separate operations to influence negotiations, they now indicate they wish to have these issues settled so that they can prepare for industry consolidation.
For our pilots, there are three main issues with the Nicolau Award. First, protection of our jobs. We bring about 1,200 captain jobs to the merger with AWA bringing about 850. Implementation of the Nicolau Award causes these numbers to reverse, with the US Airways count decreasing and the America West count increasing. The negative effects from this situation increase as the years go by for the foreseeable future. Clearly the America West pilots are benefiting from US Airways attrition at the expense of US Airways pilots. Our captain jobs are being handed over to the America West pilots. The America West pilots think they have an entitlement to the jobs brought to the merger by US Airways. This sense of entitlement includes our premium transcontinental flying in which they brought none to the merger. As a result of the Northwest-Republic merger, Northwest pilots’ Wide Body International flying was protected for twenty years. The AWA sense of entitlement is indicated by their continued insistence that ALPA hand over the Award as is.
The second issue is the next merger. As we stated above, Mr. Parker makes no secret of his desire to do another deal. Under the Nicolau Award, many of our pilots will be blocked from accessing the attrition we brought to the merger by AWA pilots with far less service at their carrier. This situation will be magnified by another merger unless the issue is addressed in one or more of the ways discussed below.
The third issue relates to furloughs. A pilot with 16 years of service should not be furloughed while a pilot who had only six months of service when the merger was announced remains working.
In addition to just keeping the operations separate, there are at least three other ways to address these serious issues. The merged list can be re-sequenced. The bidding restrictions accompanying the list can be altered and, additional contract provisions can be negotiated.
Subsequent to our presentation on May 21st in Herndon, the ALPA Executive Council passed resolutions directing the two MECs to “explore consensual approaches that promote mutual career protection and mutual success, as part of achieving acceptable collective bargaining outcomes that improve pay, benefits, work rules and job security for both pilot groupsâ€. The Executive Council also recognizes that “serious issues exist affecting the ability of both pilot groups to complete and ratify a merged collective bargaining agreementâ€.
The Nicolau list is currently being held by ALPA, something that has never happened before. Captain Prater has appointed the Rice Committee consisting of ALPA First Vice President Paul Rice (UAL), Executive Board member David Webb (FDX), and Executive Council member Ray Miller (NWA), to work with both sides to try and find a solution that we all can live with.
We currently have a stand off. The America West pilots are sitting with a huge windfall and want the Award implemented along with pay, benefit and work rule improvements. The US Airways pilots have made it clear that they aren’t about to ratify a merged contract including those improvements, if it also implements the Nicolau Award. If the Nicolau Award stands as is, the US Airway pilots may take themselves and the America West pilots out of ALPA. The company for its part is currently not interested in agreeing to separate contract improvements for the US Airways pilots.
The Rice Committee has no small challenge before it. Clearly it is in the Association’s best interest to try and work out an agreement. If the Association were to force a solution on either side, the battles would just be starting. To do nothing and allow the Nicolau Award to stand would cause a schism within the post-merger pilot group and be detrimental to the Association. Captain Prater certainly doesn’t want to have as the first significant event of his presidency the most damaging defection from ALPA since American Airlines. Obviously all ALPA pilots benefit if pilot pay and working conditions can be significantly improved at US Airways, but we won’t stand by and have that accomplished at the cost of the East pilot’s seniority. It will be very difficult to break the current logjam.
The Rice Committee has begun meeting with the Negotiating Committees from both sides. The Rice Committee’s focus so far has been on using contract provisions to address our issues. They have floated the ideas of doing this through a single merged contract and a single operation or through separate contracts and separate operations. Our MEC has taken the position that the operations should remain separate indefinitely. Meetings are scheduled to continue between the two Negotiating Committees and the Rice Committee.
The other venue in which we are fighting the Nicolau Award is in the Superior Court of the District of Columbia. The MEC has retained Roland Wilder of Baptiste and Wilder, P.C., the firm that represented the Shuttle pilots when they were merged into USAir. Dan Katz, our merger attorney, could not represent us for this case as he represents ALPA in other matters creating a conflict of interest.
On June 26th we filed an application to vacate the Nicolau Award in the District of Columbia Superior Court. The lawsuit is filed under the District of Columbia Arbitration Act. We filed in state court because the arbitration under ALPA Merger Policy is between two labor organizations that are not subject to Section 301 of the Labor-Management Relations Act (that is part of the National Labor Relations Act (“NLRAâ€). Since Section 301 does not apply, the federal courts have no jurisdiction over ALPA Merger Policy and the arbitration is subject to state law. The District of Columbia was selected because the arbitration hearings occurred there.
Under the DC Arbitration Act, a party can ask the court to vacate an arbitration award where the arbitrator exceeded his powers under the arbitration agreement. If the arbitration award does not “draw its essence†from the agreement (that is, the award does not conform to the requirements of the agreement) it can be set aside. Our argument under the Arbitration Act is that the Nicolau Award violates the ALPA Merger Policy prohibition on granting one group windfalls at the expense of the other. We also argue that the award failed to fulfill other goals of ALPA Merger Policy to “minimize detrimental changes to career expectations†and to “maintain or improve pre-merger pilot status.†(The award, not the merger transaction has caused the detrimental changes to US Airways pilots). Finally, we argue that the Award contradicts its own factual findings regarding the active status of pilots and the expectations of AWA pilots for wide-body captaincies.
The Superior Court set an initial scheduling conference for October 5, 2007. Due to AWA pilots filing a Notice of Removal to federal court on July 24, 2007, that date has been canceled and the Superior Court action stayed (technically, the case is dismissed in Superior Court unless and until the federal court orders the case returned to Superior Court).
The Notice of Removal filed by the AWA pilots is a procedural maneuver permitted under federal law when a party believes that a state court action is actually subject to federal court jurisdiction. The principal basis for federal jurisdiction in a labor case is the presence of a “federal question†(that is, a lawsuit under the federal constitution, treaties or statutes). The AWA pilots filed their Notice of Removal alleging that the AAA MEC’s challenge to the Nicolau Award presented a federal question. The federal question alleged by the AWA pilots is that the arbitration award challenge actually states a Duty of Fair Representation claim against ALPA and the relief we seek (setting aside the Nicolau Award) seeks to dictate bargaining proposals to ALPA (since ALPA presents the award produced by the merger process to the carrier.). The AWA pilots did not file a response in the Superior Court to our application under the Arbitration Act.
The AWA pilots filed the Notice of Removal as a gambit to bring ALPA National into the dispute on the side of the AWA pilots. It is also an attempt to get the AWA MEC dismissed from the lawsuit (on the ground that the AWA MEC owes no DFR to the Airways pilots—which is correct, but irrelevant).
In response to the Notice of Removal, we filed a “motion to remand†the lawsuit to the Superior Court (if the motion is granted the federal court would order the case returned to the DC Superior Court). The basis of our motion is that no federal question is presented since the ALPA Merger Policy is subject to state law and we do not allege any DFR violation by ALPA National in the Superior Court complaint. In addition to returning the lawsuit to Superior Court, we have asked the federal court to order the AWA MEC to pay the attorneys’ fees and costs incurred in seeking the remand.
The AWA pilots have made obvious their intent to entangle ALPA National in the dispute by filing a motion to “implead†ALPA to the lawsuit. The motion asks the federal court to add ALPA as a defendant in the lawsuit and order ALPA to participate in the case as a defendant. We have filed our opposition to this motion based on the same grounds of our motion to remand—our complaint does not state any claim against ALPA and ALPA is not a party to the arbitration agreement since it is to remain strictly neutral under ALPA Merger Policy.
The AWA pilots will file their reply on their motion to implead ALPA and their opposition to our motion to remand on September 14, 2007. We will then file a reply brief on the motion to remand responding to the AWA pilots’ opposition.
Once all of the papers on the two motions are filed, we anticipate that the federal court will order a hearing date on the motions. We cannot know when that will occur, but it will likely take place sometime in late October or in November. Because our motion to remand challenges the jurisdiction of the federal court, it will first address whether it should send the case back to Superior Court before it addresses whether ALPA should be involved in the case. The Superior Court case is stayed pending the decision of the federal court on the motion to remand. If the federal court grants our motion to remand and sends the case back to Superior Court, the Superior Court will set a new scheduling conference date and we will then have a new trial schedule for the case.
As we proceed on these two fronts, the best we can do is take it a step at a time. There is no quick fix for the Nicolau Award. It is going to take time to reach any resolution that is acceptable to the US Airways pilots, and during that time, we are capturing our own attrition.
Capt. Bob Kirch
Capt. Phil Carey
F/O Kevin Barry
Since the Nicolau Award was issued, efforts have been proceeding on two fronts to address the Award. While you have been getting numerous updates about individual activities, the Merger Committee would like to take the opportunity to bring it all together and give you an overview of where we are and where we’re headed.
As we discuss these issues, it is important to keep in mind that there are four parties involved: the AAA and AWA Pilots, ALPA International and Management. Each of these parties have very specific goals.
The AWA Pilots want the award implemented ASAP in order to capture US Airways Pilots jobs vacated by attrition. For every five pilots who retire, four of them are US Airways Pilots and they view these jobs as lost opportunities as each day goes by. The US Airways Pilots want the award vacated, but for now, we are capturing our own attrition evidenced by the recalling and hiring of pilots that has been taking place. ALPA International would like to see a settlement, through negotiations, which is why the Rice Committee was established. The Association is also wrestling with the decertification effort. As for management, while they once threaten separate operations to influence negotiations, they now indicate they wish to have these issues settled so that they can prepare for industry consolidation.
For our pilots, there are three main issues with the Nicolau Award. First, protection of our jobs. We bring about 1,200 captain jobs to the merger with AWA bringing about 850. Implementation of the Nicolau Award causes these numbers to reverse, with the US Airways count decreasing and the America West count increasing. The negative effects from this situation increase as the years go by for the foreseeable future. Clearly the America West pilots are benefiting from US Airways attrition at the expense of US Airways pilots. Our captain jobs are being handed over to the America West pilots. The America West pilots think they have an entitlement to the jobs brought to the merger by US Airways. This sense of entitlement includes our premium transcontinental flying in which they brought none to the merger. As a result of the Northwest-Republic merger, Northwest pilots’ Wide Body International flying was protected for twenty years. The AWA sense of entitlement is indicated by their continued insistence that ALPA hand over the Award as is.
The second issue is the next merger. As we stated above, Mr. Parker makes no secret of his desire to do another deal. Under the Nicolau Award, many of our pilots will be blocked from accessing the attrition we brought to the merger by AWA pilots with far less service at their carrier. This situation will be magnified by another merger unless the issue is addressed in one or more of the ways discussed below.
The third issue relates to furloughs. A pilot with 16 years of service should not be furloughed while a pilot who had only six months of service when the merger was announced remains working.
In addition to just keeping the operations separate, there are at least three other ways to address these serious issues. The merged list can be re-sequenced. The bidding restrictions accompanying the list can be altered and, additional contract provisions can be negotiated.
Subsequent to our presentation on May 21st in Herndon, the ALPA Executive Council passed resolutions directing the two MECs to “explore consensual approaches that promote mutual career protection and mutual success, as part of achieving acceptable collective bargaining outcomes that improve pay, benefits, work rules and job security for both pilot groupsâ€. The Executive Council also recognizes that “serious issues exist affecting the ability of both pilot groups to complete and ratify a merged collective bargaining agreementâ€.
The Nicolau list is currently being held by ALPA, something that has never happened before. Captain Prater has appointed the Rice Committee consisting of ALPA First Vice President Paul Rice (UAL), Executive Board member David Webb (FDX), and Executive Council member Ray Miller (NWA), to work with both sides to try and find a solution that we all can live with.
We currently have a stand off. The America West pilots are sitting with a huge windfall and want the Award implemented along with pay, benefit and work rule improvements. The US Airways pilots have made it clear that they aren’t about to ratify a merged contract including those improvements, if it also implements the Nicolau Award. If the Nicolau Award stands as is, the US Airway pilots may take themselves and the America West pilots out of ALPA. The company for its part is currently not interested in agreeing to separate contract improvements for the US Airways pilots.
The Rice Committee has no small challenge before it. Clearly it is in the Association’s best interest to try and work out an agreement. If the Association were to force a solution on either side, the battles would just be starting. To do nothing and allow the Nicolau Award to stand would cause a schism within the post-merger pilot group and be detrimental to the Association. Captain Prater certainly doesn’t want to have as the first significant event of his presidency the most damaging defection from ALPA since American Airlines. Obviously all ALPA pilots benefit if pilot pay and working conditions can be significantly improved at US Airways, but we won’t stand by and have that accomplished at the cost of the East pilot’s seniority. It will be very difficult to break the current logjam.
The Rice Committee has begun meeting with the Negotiating Committees from both sides. The Rice Committee’s focus so far has been on using contract provisions to address our issues. They have floated the ideas of doing this through a single merged contract and a single operation or through separate contracts and separate operations. Our MEC has taken the position that the operations should remain separate indefinitely. Meetings are scheduled to continue between the two Negotiating Committees and the Rice Committee.
The other venue in which we are fighting the Nicolau Award is in the Superior Court of the District of Columbia. The MEC has retained Roland Wilder of Baptiste and Wilder, P.C., the firm that represented the Shuttle pilots when they were merged into USAir. Dan Katz, our merger attorney, could not represent us for this case as he represents ALPA in other matters creating a conflict of interest.
On June 26th we filed an application to vacate the Nicolau Award in the District of Columbia Superior Court. The lawsuit is filed under the District of Columbia Arbitration Act. We filed in state court because the arbitration under ALPA Merger Policy is between two labor organizations that are not subject to Section 301 of the Labor-Management Relations Act (that is part of the National Labor Relations Act (“NLRAâ€). Since Section 301 does not apply, the federal courts have no jurisdiction over ALPA Merger Policy and the arbitration is subject to state law. The District of Columbia was selected because the arbitration hearings occurred there.
Under the DC Arbitration Act, a party can ask the court to vacate an arbitration award where the arbitrator exceeded his powers under the arbitration agreement. If the arbitration award does not “draw its essence†from the agreement (that is, the award does not conform to the requirements of the agreement) it can be set aside. Our argument under the Arbitration Act is that the Nicolau Award violates the ALPA Merger Policy prohibition on granting one group windfalls at the expense of the other. We also argue that the award failed to fulfill other goals of ALPA Merger Policy to “minimize detrimental changes to career expectations†and to “maintain or improve pre-merger pilot status.†(The award, not the merger transaction has caused the detrimental changes to US Airways pilots). Finally, we argue that the Award contradicts its own factual findings regarding the active status of pilots and the expectations of AWA pilots for wide-body captaincies.
The Superior Court set an initial scheduling conference for October 5, 2007. Due to AWA pilots filing a Notice of Removal to federal court on July 24, 2007, that date has been canceled and the Superior Court action stayed (technically, the case is dismissed in Superior Court unless and until the federal court orders the case returned to Superior Court).
The Notice of Removal filed by the AWA pilots is a procedural maneuver permitted under federal law when a party believes that a state court action is actually subject to federal court jurisdiction. The principal basis for federal jurisdiction in a labor case is the presence of a “federal question†(that is, a lawsuit under the federal constitution, treaties or statutes). The AWA pilots filed their Notice of Removal alleging that the AAA MEC’s challenge to the Nicolau Award presented a federal question. The federal question alleged by the AWA pilots is that the arbitration award challenge actually states a Duty of Fair Representation claim against ALPA and the relief we seek (setting aside the Nicolau Award) seeks to dictate bargaining proposals to ALPA (since ALPA presents the award produced by the merger process to the carrier.). The AWA pilots did not file a response in the Superior Court to our application under the Arbitration Act.
The AWA pilots filed the Notice of Removal as a gambit to bring ALPA National into the dispute on the side of the AWA pilots. It is also an attempt to get the AWA MEC dismissed from the lawsuit (on the ground that the AWA MEC owes no DFR to the Airways pilots—which is correct, but irrelevant).
In response to the Notice of Removal, we filed a “motion to remand†the lawsuit to the Superior Court (if the motion is granted the federal court would order the case returned to the DC Superior Court). The basis of our motion is that no federal question is presented since the ALPA Merger Policy is subject to state law and we do not allege any DFR violation by ALPA National in the Superior Court complaint. In addition to returning the lawsuit to Superior Court, we have asked the federal court to order the AWA MEC to pay the attorneys’ fees and costs incurred in seeking the remand.
The AWA pilots have made obvious their intent to entangle ALPA National in the dispute by filing a motion to “implead†ALPA to the lawsuit. The motion asks the federal court to add ALPA as a defendant in the lawsuit and order ALPA to participate in the case as a defendant. We have filed our opposition to this motion based on the same grounds of our motion to remand—our complaint does not state any claim against ALPA and ALPA is not a party to the arbitration agreement since it is to remain strictly neutral under ALPA Merger Policy.
The AWA pilots will file their reply on their motion to implead ALPA and their opposition to our motion to remand on September 14, 2007. We will then file a reply brief on the motion to remand responding to the AWA pilots’ opposition.
Once all of the papers on the two motions are filed, we anticipate that the federal court will order a hearing date on the motions. We cannot know when that will occur, but it will likely take place sometime in late October or in November. Because our motion to remand challenges the jurisdiction of the federal court, it will first address whether it should send the case back to Superior Court before it addresses whether ALPA should be involved in the case. The Superior Court case is stayed pending the decision of the federal court on the motion to remand. If the federal court grants our motion to remand and sends the case back to Superior Court, the Superior Court will set a new scheduling conference date and we will then have a new trial schedule for the case.
As we proceed on these two fronts, the best we can do is take it a step at a time. There is no quick fix for the Nicolau Award. It is going to take time to reach any resolution that is acceptable to the US Airways pilots, and during that time, we are capturing our own attrition.
Capt. Bob Kirch
Capt. Phil Carey
F/O Kevin Barry
...or, at least a guest segment on Penn and Teller's show Bullsh-t 
