APA bracing for a bad outcome!


Jan 9, 2003
30 January 2003
Fellow Pilots,
Hopefully you have been reading and/or listening to each and
every message or Hotline that has come from APA National and
Kevin and me. Since you may not have had the opportunity to read
what the other domicile reps have said to their bases pasted
below are some excerpts of what they wrote. A majority of what is
attached below is compiled from messages from DFW, DCA, and MIA.
The last item is a response from Captain Kudwa to one of our
None of this is meant to spread fear, uncertainty, and doubt
(FUD). Instead it is intended to make you aware of factors
affecting your airline. After reading this you can draw your own
conclusions. There are those who will accuse the APA of
managing/lowering your expectations and others who will accuse
the APA of not having done more, but the reality is the APA is
not in command of this ship. The current management team of
American Airlines has been reluctant to include us in their
planning and decision making process during these difficult
times. The APA stands ready to work with all parties to ensure
American Airlines remains the greatest airline in the world.
>From what you can read in your daily newspaper, it is fairly
obvious that AMR is in precarious financial shape. Fitch Ratings
has assigned AMR a credit rating of CCC+ which essentially put
AMR bonds in junk bond status. The BOD is very concerned with
AMR''s future, along with our careers and families.
The bottom line is AMR needs our cooperation and the cooperation
of all of the employees of AA. That cooperation would be more
forthcoming if CEO Carty immediately stopped his involvement with
CESTA and the ATA which are actively lobbying Congress for a
change in the Railway Labor Act.  We see the current financial
state of AA to be one requiring all resources committed to two
main goals.  First and foremost we all need to commit to the
survival of our company, American Airlines.  Secondly we need to
work together to craft a plan which will make American Airlines a
viable corporation for the future and provide for the success of
our company long term.  These goals cannot be achieved while the
parties fight in the halls of congress over the RLA.  To coin a
phrase We cannot have two people doing the job one man should be
doing.  That job is the survival and eventual success of our
To believe that changes in the RLA will effectively make
management and labor work together is a pipe dream.  To think
that changes to the RLA will potentially remove the problem of
transportation disruption in the Airline Industry some time in
the future, while American Airlines is teetering on the edge of
solvency is misguided use of management''s time and resources.
We must focus on the future, but we must have our current
management team focused on the same goals.  We need a plan from
the current management team, and to this point they have provided
Our current management team continues to request meetings with
the employees and Labor Coalition leaders.  Unfortunately, this
current management team does not bring any suggestions to the
table.  Rehashing the same data which is displayed in the news
paper is of no value in turning the company around.  We have
serious problems, which need serious answers.  Our current
management team has been asked directly What is it you need from
us?  To date, they have answered  Nothing.
We (APA) have proposed a single airline concept.  The savings and
flexibility of such a system and the synergy of putting all the
employees on the same page, working for the same company, with
the same goal are immediately evident.  We face a difficult task
in providing leadership if our current management team continues
to point out the obvious without a plan to resolve the problem.
They must tell us how we can help, and provide a plan to show
such action on our part will not be squandered.  The careers and
futures of our pilots are at stake.  We have expended tremendous
efforts in building the labor coalition and have worked to
understand the other labor groups'' issues.  We (Labor Coalition)
understand the problems confronting this company, but our current
management team needs to present a plan involving more than our
current business plan, which is more of the same.
Our Advice:
Don''t make any major purchases and cut your expenditures. You
need to financially and emotionally prepare yourselves and your
families. VP Kudwa continues to state that we have a 900 pilot
surplus. Combine that with the previously announced 1245
furloughs, and the possible overage of F-100 pilots if AMR once
again changes the retirement schedule of those aircraft, and
we''re looking at  ** potential furloughs IF AMR attempts to
invoke Force Majeure ** in the event of a Iraqi war. We don''t
wish to create fear, uncertainty, and doubt (FUD) but we feel a
responsibility to relate that times are perilous. Remember your
Boy Scout motto: Be Prepared. The situation could get very ugly
before it gets better.  ** My editing **
The APA needs your help.  We need volunteers for Communications
Committee tasking, CommNet, SPC and local domicile volunteers. If
you have writing skills, we can put you to work. Now is the time
to get involved with your career. If not now, when?
Manage Your Careers!
In initial discussions with UAL pilots, management has given them
a Term sheet that is management''s Wish List of all the items
they''d like to modify in the pilot contract.  We have copied this
term sheet below. Basically, they are being asked to formalize
permanent, massive, and onerous concessions in their contract. [
] indicate editorial comments.
UAL Proposal to pilots:
Compensation - Discuss methods of reaching cost saving
objectives through compensation adjustments including:
Eliminate the base hourly pay increases.
Eliminate the international override. [Current Capt rate=$8/hr]
Eliminate the incentive pay for late night flying. [Current rate
is $15/hr]
Revise the junior manning assignment override pay.
Revise base hourly pay rates by reducing by 29%.
Revise minimum monthly guarantee from 75 hours to 60 hours.
Low Cost Carrier Competitive Solution - Create a United
Sub-brand that is competitive with Frontier, Jet Blue, Southwest,
ATA, etc.
Eliminate furlough protection for all pilots.
Number of Regional Jets and their deployment - Eliminate the
Eliminate minimum number of pilots related to SJs.
Fleet Number - Eliminate absolute number of aircraft.
Eliminate Section restricting carriers to whom aircraft may be
Number of Block Hours - Eliminate absolute minimum number of
block hours.
Permit United to enter into domestic alliances as needed.
Permit United to enter into international alliances as needed.
Enable route transfer as needed in the business plan.
Hours Maximums from 81/85 to 92 in all circumstances to permit
more productivity.
Eliminate bank provisions.
Eliminate Duty Rigs.  [E & G time]
Trip Rig Revise to provide ratio of 1:4.5 to reduce penalty.
[Currently 1:3.5]
Minimum Day Eliminate.
Days Off :
Revise lineholders minimum days off to 10 days; revise reserves
to 12 days of which 4 are moveable to increase productivity.
Atlantic Augmentation not required under 8 hours.
QWL Letter: best efforts to meet quality of life parameters.
Shuttle Letter Delete Letter 94-11.
Staffing :
Create International Relief Pilot (IRP) applicable to two man
crew aircraft to provide cruise pilot as augmented crew.
Elimination of the minimum pilot provisions in Section 1.
Training Expense Apply a 36-month freeze to each position award.
[Currently 24 months]
Preferential Bidding Implement a preferential bidding system.
Eliminate domicile closure language and permit any base to be
Permit non-seniority list simulator instructors, sale of training
center and greater flexibility in sale of simulator surplus time.
Revise multiplier in the Pilot Defined Benefit Plan. [Currently
Eliminate Company contribution to Pilot Directed Account. [11%
Establish a 401(k) retirement account.
The employee contribution to the cost of retiree medical for pre
and post Medicare retiree medical benefits may be modified.
Replace all current medical and dental plans with a uniform plan
to be available to all Company employees.
All employees shall contribute to the cost of coverage for all
company-sponsored medical, dental plans as set forth in Exhibit A.
Revise pilot long-term disability plan.
Revise hourly per diem expense allowance in Section 4-A to $1.50
domestic and $1.75 international. [Currently $2.10 Dom; $2.60
Revise to provide maximum 35 days of vacation accrual and pay.
[Currently 44 days at 26 years]
Eliminate the vacation overlap pay provision by paying 2.6 hours
per vacation day.
Eliminate requirement for downtown layovers.
Force Majeure.
Grievance Withdrawals ALPA to withdraw specified grievances with
prejudice.  List to be provided.
Success Sharing:
Establish an appropriate success sharing program to ensure that
employees participate in United''s successful transformation.