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[P align=center][b][FONT face=Arial size=5]PIT 40 E-News[/FONT][/b][/P]
[P align=center][i][FONT face=Arial size=2]Local 40 PIT /PIW News[/FONT][/i][/P]
[P align=center][FONT face=Arial size=1][i]December 21/2002[/i][/FONT][/P]
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[P align=left][FONT size=2][FONT face=Arial][b][i]Members of Local 40,[/i][/b][/FONT]
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[P][FONT face=Arial size=2]I am writing to you on my way home from DCA where the entire MEC had been in session discussing the Company's latest concessionary demands. As I had written previously on December 3rd, we would engage in discussions with the Company regarding productivity savings as written in our 2002 new ratified Company restructuring agreement only if management takes more concessions beyond their present 2003 agreement, and all labor groups have negotiated agreements. In the early part of this week, CWA, IAM and AFA were threatened that if we did not come to the table, Dr. Bronner of RSA would pull his financing and force a liquidation according to the company. As you know ALPA ratified their proposal within a record breaking 5 days with NO membership ratification. Under this threat of shutting down, CWA came to a T/A followed by TWU and IAM. These Labor groups will send out their proposals from the Company for membership ratification along with AFA.[/FONT][/P][FONT size=2]
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[P][FONT face=Arial size=2]Many of you have responded to the latest mailing I sent to you. I have read every single one, including those that have been e-mailed and placed in the AFA box; I even brought them all with me to DCA to have presented to the Company. I thank you and am grateful for your adamant direction. I want you to know that I never wavered in my position and held steadfast on my commitment to this membership to uphold the integrity of our profession and protect our collective bargaining agreement with all my strength. The Company insisted on a vote from this MEC to send it out with a "[b][u]FOR[/u][/b]" recommendation, as you know it went out with a "[b][u]FOR[/u][/b]" by majority vote. I told our MEC that I would not endorse any proposal that had any pension changes, additional unaffordable increases in medical/dental, or a reserve system that is nothing short of "[b]SLAVERY[/b]".[/FONT][/P][FONT size=2]
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[P][i][FONT face=Arial]Facts you should ponder:[/FONT][/i][/P]
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[P][FONT face=Arial size=2][b]1. [/b]This company had reported an operating profit in October, 2002 of $19 Million dollars, but posted a net loss of $45.6 million for the month after accounting for a $68 million restructuring charge and $21 million in interest expense according to the new filing with the Securities and Exchange Commission and federal bankruptcy court. Operating revenue for October was $572.4 Million while its operating expenses totaled $553.4 Million. About 80 percent of the revenue--$465 million--was from passenger ticket sales. The Company had cash on hand at the end of the month $830.7 Million. Obviously, this shows that their "new business model" works. That is why, I believe, RSA got involved and outbid the Texas Group out of the[/FONT] [FONT face=Arial size=2]investment in our Company. So, does it sound reasonable that Dr. Bronner the CEO (Mr. Labor Friendly) would pull his financing and attempt to ask the board to liquidate this company if he could not get the labor groups to subsidize even more for this company to ensure his profit? Ponder this for a while...[/FONT][/P][FONT size=2]
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[P][FONT face=Arial size=2][b]2. [/b]Texas Group wanted a stake in this company, but was out bid by RSA by $40 million, and the creditor's board and the courts allowed for RSA to be the new stake holders of our company. Do you think that two months later, that Texas Group would not want a piece of our company? We still have labor concessions totaling $850 million, alliance with United who is now free of their creditors, RJs relief from ALPA in place... "fresh start" bankruptcy. Do you think Texas Group would not be interested in our company again? [b]"[i]Hey Dr. Bronner, don't let the door hit you in the head; I would hate that for you.[/i]"[/b][/FONT][/P][FONT size=2]
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[P][FONT face=Arial size=2][b]3.[/b] The lump sum return that is in this Co. proposal scheduled for 2007 is only for those flight attendants who are not furloughed and on the property at that time on "mainline". If you happen to flow into Mid-Atlantic...you're out of luck.[/FONT][/P][FONT size=2]
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[P][FONT face=Arial size=2][b]4.[/b] Keep in mind that any productivity savings given to this management means more lost jobs than the 4,700 that will be gone as of January 7, 2003 since 9/11. They say that translates to somewhere in the 300 range of more jobs gone...do you think their calculation is correct? Here is a company that would not cost out what all the productivity savings proposed for the flight attendants are, admit that they didn't calculate a possible confrontation in Iraq, and that revenue decline was "off their projected mark", and that pension contribution was now a problem, and they didn't see this back in June.[/FONT][/P]
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[P][FONT face=Arial size=2][b]5.[/b] The ATSB guarantee, is just that a guaranteed loan by the government. We are [b]NOT[/b] borrowing from the government; they only guarantee who ever finances us. (Just like the FDIC at your bank). In my mind, I do not believe United really cares if they get the ATSB approval. I believe their attempt to qualify for the ATSB, is to get their Labor cost low and in line just like US Airways. Their filing for bankruptcy was to rid themselves of dept and prove to their stockholders that they tried. Genius, don't you think? Just watch the rest of the "big six"; down size and furlough, break the unions.[/FONT][/P]
[P][FONT face=Arial size=2] [/FONT][/P][FONT face=Arial size=2][b]6.[/b] [IMG alt="Jerry Glass of Ford and Harrisson Consultants" src="http://www.afausairways.org/FA/glass_jerry1.jpg" align=left border=0] This new management team will be sending you out information on how very important it is for you to vote "[b]FOR[/b]" this proposal, and attempt to discredit those leaders who speak out. One of our new Labor Friendly Relations senior executives, who came on board this past March and who "[i]spear heads[/i]" all these negotiations, has a Labor Relations Consulting firm. He was hired here to do a job and that was to get labor concessions from all the unionized groups, along with some other new folks that are all VPs. What I was able to investigate is that he is affiliated with a company called [A href="http://www.fordharrison.com/fh/practice/litigation.asp" target=_blank]Ford and Harrison Labor Consultants[/A]. And if you go to their web page and hit "[A href="http://www.fordharrison.com/fh/practice/litigation.asp" target=_blank]Litigation[/A]" (http://www.fordharrison.com/fh/practice/litigation.asp), you will see that their motto regarding Unions is ...[b]"When they roar...we pounce"[/b]. Remember, Borman liquidated Eastern...anyone hear from him since then? Where are Lorenzo and Carl Icahn? Anyone heard from them?[/FONT]
[P][b][FONT face=Arial size=2][i]Salient points of the revisions to our restructuring agreement in the Company's proposal:[/i][/FONT][/P][FONT size=2]
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[P][FONT face=Arial]Effective date: January 1, 2003[/FONT][/P]
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[P][i][FONT face=Arial]Productivity:[/FONT][/i][/P][/FONT][/b]
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[P][FONT face=Arial size=2]Modify duty rigs and VM: rig 1:2 changed to 1:2.25 for day (0600-2159) and 1:2 for night (2200--0559): Variable Minimum day of 5 hours with [b]NO FLOOR OR CEILING[/b].[/FONT] [/P][/LI][/UL][b][FONT size=2]
[P][i][FONT face=Arial]Claiming Sick Leave:[/FONT][/i][/P][/FONT][/b]
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[P][FONT face=Arial size=2]Line holders: may claim sick leave to [b]ONLY [/b]the line value post SAP, post over projection adjustments or preferential bid award (which ever is in effect) for the month [b]MINUS 5 HOURS UNLESS THE SICK CLAIM IS FOR MORE THAN 1/2 OF THE LINE VALUE, IN WHICH CASE THE F/A MAY CLAIM UP TO THE LINE VALUE BY USE OF SICK BANK. [/b][/FONT] [/P][/LI][/UL][b]
[P][FONT face=Arial size=2][i]Example - [/i][/FONT][/b][FONT face=Arial size=2]If you are on 95 hour option and your post sap is 80 hour line, you can claim 75 hours sick;[b] NOT 80 [/b]and not your option no matter how much bank time you have. If you claim only one trip sick and fly the rest of the month you may not be able to claim the entire trip sick. Ex. I am on 95Hr/option and have a line worth 80 hours. I call in sick for a 4 day worth 20 hours, and then fly 74 hours to try to get to my option...and then add the 20 hours to come in with 94 hours...[b]WRONG[/b]... you can only claim [u]1 hour[/u] sick bank time...as your line was worth 80 hours minus 5 hours plus your 74 hours flown plus 1 hour sick bank get you to 75 hours only. You would have to keep on flying and claim nothing out of your bank in order to have a full paycheck. So be careful and plan on never ever getting sick because you will be going home with less pay for that month, and when and if you decide to access your medical, remember you have deductibles and co-pays to pay out. So, it depends on what you fly and what your line value is minus 5 hours always. In essence calling in sick and using your sick bank is a penalty of less take home pay for the month. Reserves: (much worse) A reserve's sick claim, when added to [b]PREVIOUS AND SUBSEQUENT FLYING and OTHER CREDITED TIME [/b](training etc) for that month, [b]MAY NOT EXCEED YOUR MONTHLY GUARANTEE! [/b]However [b]ONLY[/b] those reserves who are on 90-95 and l00-l05 hr option [b]CAN[/b] claim sick up to their option [b]MINUS[/b] (of course) 5 hours. [b][i][u]Good job management! Who thought of that? Would you say that this new management cares for their employees? Is this labor friendly in your opinion?[/u][/i][/b][/FONT][/P][b][FONT size=2]
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[P][i][FONT face=Arial]LTD:[/FONT][/i][/P][/FONT][/b]
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[P][FONT face=Arial size=2]120 day waiting replaces the 90 day wait and only 50% of your earnings instead of 60%.[/FONT] [/P][/LI][/UL][FONT size=2][b]
[P][i][FONT face=Arial]OJI:[/FONT][/i][/P][/b]
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[P][FONT face=Arial]Salary continuance of 6 months replaces 15 months.[/FONT] [/P][/LI][/UL][b]
[P][i][FONT face=Arial]MEDICAL/DENTAL CONTRIBUTIONS:[/FONT][/i][/P][/b][/FONT]
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[P][FONT face=Arial size=2]Additional increases in contributions in options 2 and 3 and are higher than previously negotiated commencing in 2003. (Company will reopen the enrollment in January in case f/as find that the option they chose in October is unaffordable). Also [b]DEDUCTIBLES WILL NOT REMAIN A CONSTANT GOING FORWARD.[/b] They will commence increasing in 2005 along with co-pays. Please read the packet on medical carefully.[/FONT] [/P][/LI][/UL][FONT size=2][b]
[P][i][FONT face=Arial]Dental increases respectively.[/FONT][/i][/P]
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[P][i][FONT face=Arial]PENSION: [/FONT][/i][/P]
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[P][FONT face=Arial]NO CHANGES[/FONT] [/P][/LI][/UL]
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[P][i][FONT face=Arial]RESERVE MODIFICATION:[/FONT][/i][/P]
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[P][FONT face=Arial]NO[/FONT][/b][FONT face=Arial] passing.[/FONT] [/P]
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[P][FONT face=Arial]Time balancing that is driven by credited time NOT seniority.[/FONT] [/P]
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[P][FONT face=Arial]No increase in guarantee to go along with these changes.[/FONT] [/P]
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[P][FONT face=Arial]Increase in Involuable days from 6 to 8, but still having 11 days off. (Please read the details in the Company Proposal).[/FONT] [/P][/LI][/UL][b]
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[P][i][FONT face=Arial]WAR CONTINGENCY:[/FONT][/i][/P][/b][/FONT]
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[P][FONT face=Arial size=2]5% wage cut (deferral) if in the event that the US invades Iraq OR there is an act of terrorism which has an adverse impact on commercial aviation, there will be an immediate 5% pay cut (deferral) for up to 18 months and repayment will commence [b]AFTER[/b] these 18 months in monthly installments. If the co. reports a pre tax profit with respect to any quarter during which the pay deferral is in effect, the deferral will immediately stop and repayment will begin in the next month to continue for the same number of months as were included in the deferral, management will participate in this deferral as well.[/FONT] [/P][/LI][/UL][b][FONT size=2]
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[P][i][FONT face=Arial]PREFERENTIAL BIDDING:[/FONT][/i][/P][/FONT][/b]
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[P][FONT face=Arial size=2]All primary lines, SAP, and secondary lines will be replaced with Preferential bidding system.[/FONT] [/P][/LI][/UL][b][FONT size=2]
[P][i][FONT face=Arial]Bid sheet modification: [/FONT][/i][/P][/FONT][/b]
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[P][FONT face=Arial size=2]Change is that there will be [b]NO[/b] minimum requirement of 10% open time (sec. 9.B.4 eliminated. So, is the bid sheet still there?[/FONT] [/P][/LI][/UL][FONT size=2][b]
[P][FONT face=Arial][i]EQUITY PARTICIPATION: [/i][/FONT][/b][FONT face=Arial](This [b]ONLY[/b] means vesting, [b]NOT[/b] receiving payment)[b] [/b][/FONT][/P][/FONT]
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[P][FONT face=Arial size=2]25% schedule until you reach 100% vesting which takes three years). Accelerated the vesting schedule to reflect 25% on the first day of the month 60 days after the emergence from bankruptcy. (Please read the details in the proposal) Also receive a lump sum payment no later than March 2007 and March 2008 of 2% of adjusted w-2 earnings from the preceding year [b](DOES NOT INCLUDE MDA EARNINGS WHICH IS PROBABLY MUCH BIGGER AT THAT TIME, AND IF YOU ARE STILL FLYING MAINLINE AND NOT FURLOUGHED OR IN MDA).[/b][/FONT] [/P][/LI][/UL][b]
[P][FONT size=2][i][FONT face=Arial]MID ATLANTIC:[/FONT][/i][/P][/FONT][/b][FONT size=2]
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[P][FONT face=Arial]No contract negotiations.[/FONT] [/P]
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[P][FONT face=Arial]Division of mainline.[/FONT] [/FONT][/P]
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[P][FONT face=Arial size=2]Mirror contract of present American Eagle's flight attendant agreement (they are currently in negotiations, and if they receive a better agreement, we won't get that). AFA International states that their agreement is one of the worst in the Industry.[/FONT] [/P][/LI][/UL]
[P][FONT face=Arial size=2]As your union representative, I will [b]NOT[/b] give you a recommendation on how you should vote for this proposal. Our negotiating Committee of MEC Officers (Pres and Vice) attempted to negotiate with this company for two straight days, [SPAN]hour upon hour, while we, the MEC, [/SPAN][SPAN]waited[/SPAN] in the hotel conference room for them to return. [b]AGAIN,[/b] the idea by this "new" management team was "demand and concede. I believe that we as flight attendants are worth much more than this company is willing to recognize, and I do not believe that a job that only provides me to pay a few of my household bills and borrow the rest on a VISA is considered a "good job". I can find those kinds of jobs anywhere. Each flight attendant will have to evaluate what this job means to them personally and financially, consider what you can live with and how long. No matter what the outcome, I can live with what comes next if this fails; I have already thought it through. You decide.[/FONT][/P][b][FONT size=2]
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[P][FONT face=Arial size=2]In a broader sense our actions as labor will have a rippled effect across our industry as well as all industries where there are unions and those attempting to organize as there now has started a "domino effect" with these major airlines running to get their "free pass" and "fresh start" by filing for Chapter 11 or those who are entertaining the idea to file. This I know is a [b]FATAL STEP FOR ORGANIZED LABOR.[/b] It is the Labor Relations consultant that sits up there in the crystal palace who has been hired by our Company, who will be considered KING and be able to write his own ticket to "bust" as many unions as he can if he succeeds in getting labor to concede to all of their demands in the future. It is we who will have to endure the pain for 7 years of our viable working careers. [/FONT][/P][b]
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[P][FONT size=2][FONT face=Arial]Will I facilitate him in piercing the very heart of our contract...[b]N - E - V - E - R![/b][/FONT][/P][b]
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[P][FONT face=Arial]Together we stand,[/FONT][/P]
[P][FONT face=Arial]Teddy Xidas[/FONT][/P]
[P][FONT face=Arial]LEC President, Local 40 PIT/PIW[/FONT][/P][/FONT]