U
UAL_TECH
Guest
Negotiation notes
Rosemont, Illinois, December 9, 2004 9:30 PM
The company returned to the table today with an answer to our counter term sheet proposal of 12-7-04. The offer changed very little. The company restated its position to accept no less than $101 million average annual savings (AAS). While it changed the values of some of the building blocks the net effect remains the same. The company only corrected errors in their original calculations that the union identified. They made no compromises.
A few items changed by a relatively small amount while the largest change occurred in the credit given for allowing the outsourcing of fueling. The National Mediation Board recently ruled that United employees that “preponderantly†performed fueling duties belong in the Mechanic and Related class and craft. The company wants to outsource this work and will issue AMFA a credit for the value of that action. The company’s original term sheet did not give us the full credit. This latest offer, even though better than the first offer, still does not give us full credit.
The counter term sheet proposal reflected the maximum amount of cost saving concessions for HMV work that we outsourced to domestic MROs over a year ago. It also incorporated the fueler work that we never actually performed. The company did not substantively engage the union. It merely rearranged the package and corrected its sloppy initial effort.
Here’s the company’s answer to our counter term sheet:
• AMFA proposed a two-year duration with a Section 6 negotiation opener on 1-1-07.
• Company response: No. The company wants a five-year 364-day duration 1-1-05 to 12-31-10. The company said that the exit lenders required this long duration.
• AMFA proposed a 5% base wage reduction with a 1.5% increase the second year with a Section 6 negotiations opener on 1-1-07
• Company response: Not enough.
• AMFA proposed full fueler credit.
• Company response: Increase credit (double initial offer) but still short of full credit.
• AMFA: Take credit for offshore OSV HMV 747/777.
• Company: Issue credit.
• AMFA: Increase scope of offshore OSV HMV to include all fleets.
• Company: Have not completed the analysis but doesn’t think the savings will be significant.
• AMFA: Eliminate the 2nd step of grievance process to gain efficiencies.
• Company: Expressed little interest.
• AMFA: Keeps all other original term sheet items including the removal of the protection date that will result in more layoffs.
• Company: Still need $101 million in cost savings each year.
The company lead negotiator prefaced the presentation of the company offer with a few remarks. He reminded the union negotiators that reaching a successful agreement would allow our members to share in the future success of the company. CEO Glenn Tilton and COO Pete McDonald made almost identical remarks in the December 6 Eye on UA and the December 7 NewsReal.
In a brief round of questions from negotiators, one union negotiator seemed particularly perturbed by company intransigence in light of this company public relations campaign. This union negotiator pressed the company representative, “Who in AMFA will share in this success? With the removal of the LPP's [labor protective provision – it refers to the October 30, 1989 protection date] and the full outsourcing of PV/GQ, the computer technicians and Utility, we obviously are not invited to the party." The company lead negotiator replied, “I don’t agree.â€
Next week the negotiations continue in San Francisco. That’s Tuesday, Wednesday, and Thursday, December 14-16. Contact Local 9 to sign up for an observer position.
After two weeks of negotiations, the company clearly does not intend to soften on its insistence to take $101 million from our CBA. Just 18 short months ago the company came to us and said, “we must reduce labor costs by $2.5 billion per year until 2009.†Then we would be able to exit bankruptcy as a financially sound company. We gave up, among other things, 13% wage cuts, outsourced all HMVs, and substantially increased our medical costs. And today its déjà vu all over again!
Is there any reason to believe their present business plan?
Is there any reason to believe that taking more and more from labor concessions that will solve their financial crisis?
Will we back here again next year – round three?
I believe the answer lies in the non-CBA proposals that AMFA attempted to place on the table the very first day.
What a surprise?
B) UT
:down: Don't EVER forget EFLOP! 15% profit sharing won't even come close to recouping what you've lost and will still loose!!!! Now TECh does this REALLY sound like a company that has a plan other then to get YOU the employees to give them the DIP financing they need to exit BK. But as in your last statement, like what happenend at USAIR. They'll be back for MORE! SO NOW don't you agree that UniTED SUX'S????
