Beyond repair: Union strife divides AA mechanics
By D.R. STEWART World Staff Writer
4/11/2004
A backyard fight is becoming a national debate.
The union battle at American Airlines for the loyalty of 16,000 aircraft mechanics is turning into a referendum on economic and national security issues that mirrors the November presidential election.
The campaign between the incumbent Transport Workers Union, a traditional industrial union that has represented American mechanics since 1946, the year George W. Bush was born, and the upstart Aircraft Mechanics Fraternal Association features the familiar themes of post-9/11 security, democracy and job loss.
But the campaign also will gauge how mechanics view themselves, the future of their profession and the TWU, which agreed to 17 percent pay and benefit reductions and thousands of job cuts to avert a bankruptcy filing by American last spring.
In March, AMFA filed documents with the National Mediation Board for an election to determine union representation at American.
The board is in the process of verifying that sufficient authorization cards have been signed by American mechanics. AMFA needs signed authorization cards from 50 percent plus one of American's mechanics to hold an election.
If AMFA's documents are in order, an election could be held by summer, officials said.
While the nation's presidential candidates will debate the role of the United States in Iraq, domestic security versus domestic freedoms, tax cuts and energy policy, American Airlines mechanics are discussing job losses, wage and benefit concessions, bankruptcy and the future of the airline and the industry in the aftermath of the terrorist attacks and the start of wars in Iraq and Afghanistan.
Coming amid industrywide losses estimated at $2.2 billion in 2004, rising fuel prices, hot competition from discount carriers, surplus capacity that constrains the major airlines' ability to raise ticket prices and an industry trend toward outsourcing of aircraft maintenance, the debate will be interesting, according to mechanics, union officials and analysts.
"The large hub-and-spoke carriers are having the most trouble, and there's not much they can do," said John Pincavage, who follows the airline industry for Pincavage & Associates in Westport, Conn. "You can't de-hub: You shed revenue faster than you can cut costs."
It's been a year since American's unionized mechanics, pilots and flight attendants voted to accept $1.8 billion a year in wage and benefit reductions to keep American from filing bankruptcy. At the same time, airline management trimmed an additional $2.2 billion in costs -- closing terminals, cutting thousands of jobs and parking hundreds of airplanes in the desert.
But in the aftermath of Chief Executive Officer Gerard Arpey's campaign "Come Together, Win Together," many mechanics are unhappy.
Pat Kinnamon, an American mechanic in Tulsa and TWU shop steward, said the concessions cost him $946 a month in wages and benefits, and five vacation days. He said he accepted the lower standard of living until it became obvious -- with the revelations of executive perks and bonuses last spring -- that the sacrifices were not being shared.
"Whether you support the TWU or AMFA, we all want the same thing: we want the airline to be profitable; we want competitive wages and benefits; and we want to be able to trust the wise leadership of the company and union," Kinnamon said. "But with everything that's gone on, everybody has lost credibility and faith in the union and the leadership of the company."
AMFA, a craft union not affiliated with the AFL-CIO and founded 40 years ago by former American mechanic O.V. Delle-Femine, has gathered strength in proportion to the discontent at American, say officials of TWU and AMFA.
Don Rodgers, chairman of the AMFA organizing committee in Tulsa, is a former TWU shop steward and an American mechanic since 1997. He said he broke ranks with the TWU because the industrial union is not democratic.
"If you asked the wrong questions, you weren't welcome," Rodgers said. "When it became obvious to me that they were more interested in putting dues in the international's pocket or getting out of work or being more worried about politics than the membership's best interests, I decided I would just work on airplanes, learn my trade, do my eight hours and go home. Discontent is what breeds change."
Bob Owens, an American mechanic at JFK International Airport in New York, said in a recent e-mail that the TWU talks about democracy, but its actions say otherwise.
"Last year when we got that concessionary contract rammed down our throats by Jim Little (TWU air transport division director in Fort Worth) with his crooked voting system and his 'without further ratification' signature, several locals sued," Owens writes. "In court, the TWU said that we do not even have the right to vote on our contracts, it's the international's contract, and they can modify it as they see fit without our permission, and the court, after reviewing our constitution, agreed.
"All you have to do is look at the cover of the contract book. It states that the TWU owns this contract -- no individual local has jurisdiction. So while the TWU tells the members about how they are in control and the locals are autonomous, just look at what they say in court when the members or locals want to actually assert the rights they were led to believe they had. They say the direct opposite. Their own testimony exposes them for the liars they are."
Little calls his critics "Monday morning quarterbacks."
After TWU members ratified the five-year concessionary contract last spring, company and union negotiators agreed on three contract modifications that the membership didn't vote on.
They included reopening the contract in 2006 for possible amendments, the union's ability to swap contract provisions of equal value and management's ability to participate in a performance bonus program based on company profitability.
"We knew if we went to a revote, American would file for bankruptcy," Little said. "Everyone told me you don't want to go there -- it would be disastrous; 12,000 people would lose their jobs."
AMFA's tough talk about not accepting concessions is just hot air, he said.
"They haven't been there; they didn't do the financial analyses," Little said. "We hired a financial banking group, three attorneys knowledgeable about bankruptcy, a research analyst -- but no one could tell us that we would be better off in bankruptcy. The pilots did their own analysis, and they found it was uncertain whether American could survive bankruptcy."
Art Luby, a Washington, D.C., lawyer for the TWU, said AMFA leaders tell supporters that they would have taken the company into bankruptcy and forced it to prove its case.
"The company was losing $5 million to $7 million a day. There would have been a (bankruptcy) filing sometime in late spring," Luby said. "The company (without concessions) would have run out of capital to sustain itself. I'm not aware of any analyst who came up with a different position."
Delle-Femine has told American mechanics that AMFA does not accept wage and benefit concessions.
"Northwest asked for concessions last year, and we had an outside firm look at their books and we decided they didn't need them," Delle-Femine said. "We don't believe in giving any company we represent long-term concessions for short-term economic problems. We said, 'If you need help, we will give you a loan, and after a year if your profits are up, you pay it back.' "
AMFA, however, has represented mechanics at Northwest Airlines during the past five years when Northwest eliminated thousands of mechanics' jobs. In June 1999, when AMFA took over from the International Association of Machinists, 9,500 mechanics and related workers were employed at Northwest. About half have been laid off, retired or taken voluntary layoffs, officials said.
Today, 3,500 mechanics are members of AMFA Local 33 in Minneapolis, and Northwest has shifted heavy maintenance to bases in Singapore and China, said Jim Atkinson, president of Local 33.
"The disturbing thing for us is that all major airline mechanics in this country must go through a 10-year criminal background check by the FBI," Atkinson said. "That was initiated after 9/11.
"Our ongoing question to the federal government is what kind of background check is being done on the people in Singapore and China? It's a concern to us that we know the backgrounds of these people who have full access to the airplanes."
At American, mechanics agreed to wage and benefit cuts until 2008 in return for preserving jobs and the Alliance Airport maintenance base in Fort Worth and the Kansas City International Airport maintenance facility, company and TWU officials said.
"I think there are better times ahead and American, not being in bankruptcy, will be better able to adjust to the times ahead," Little said.
Senior TWU officers have been meeting once a month with Arpey and his senior staff to discuss issues of importance to mechanics, Little said. TWU officers also meet periodically with American's chief financial officer to review the company's books.
"We have their books analyzed by our financial people. That's unprecedented," Little said.
Some mechanics are uncomfortable with the close ties between management and union officers.
Dave Stewart, an American mechanic in Tulsa and co-chair of the AMFA organizing committee, said if TWU officials violate the constitution or the law, the membership can vote them out.
"But if they continue selling you out by signing off on secret letters of agreement with management, you can't do anything about it," Stewart said. "What happens then is that with no accountability of officers, you have no accountability of members, which leads to discipline and production problems."
The TWU has become a business that sells members life, medical, short-term disability and supplemental medical insurance, Stewart said.
"It has become an institution that is a business within itself," he said. "They make decisions not based on members' well-being but on institutional financial well-being."
Rick Mullings, spokesman for TWU Local 514 in Tulsa, said the union has saved jobs and preserved a tradition unique among U.S. airlines.
"American Airlines is the only airline left in the industry doing over 80 percent of its maintenance in-house," Mullings said. "Our union is all about protecting workers and their rights.
"AMFA's unwillingness to take part in Washington politics is very bad for their members. If you believe you are a union and all you do is collect dues and not represent members' interests in Washington, that is just foolish. It's pretty obvious which union is protecting jobs and their members' interests."
Members of both unions said they worry about the stability of the airline industry and the future of their profession.
"The professionalism, passion and loyalty to the individual and the company is dropping, and it scares me," Stewart said. "There's a strong argument that the continued erosion of pay and benefits for skilled technicians will eventually erode the safety margin that is provided for the flying public.
"I'm not saying it's not safe to fly today, but the continued erosion of pay and benefits is going to have an effect."
By D.R. STEWART World Staff Writer
4/11/2004
A backyard fight is becoming a national debate.
The union battle at American Airlines for the loyalty of 16,000 aircraft mechanics is turning into a referendum on economic and national security issues that mirrors the November presidential election.
The campaign between the incumbent Transport Workers Union, a traditional industrial union that has represented American mechanics since 1946, the year George W. Bush was born, and the upstart Aircraft Mechanics Fraternal Association features the familiar themes of post-9/11 security, democracy and job loss.
But the campaign also will gauge how mechanics view themselves, the future of their profession and the TWU, which agreed to 17 percent pay and benefit reductions and thousands of job cuts to avert a bankruptcy filing by American last spring.
In March, AMFA filed documents with the National Mediation Board for an election to determine union representation at American.
The board is in the process of verifying that sufficient authorization cards have been signed by American mechanics. AMFA needs signed authorization cards from 50 percent plus one of American's mechanics to hold an election.
If AMFA's documents are in order, an election could be held by summer, officials said.
While the nation's presidential candidates will debate the role of the United States in Iraq, domestic security versus domestic freedoms, tax cuts and energy policy, American Airlines mechanics are discussing job losses, wage and benefit concessions, bankruptcy and the future of the airline and the industry in the aftermath of the terrorist attacks and the start of wars in Iraq and Afghanistan.
Coming amid industrywide losses estimated at $2.2 billion in 2004, rising fuel prices, hot competition from discount carriers, surplus capacity that constrains the major airlines' ability to raise ticket prices and an industry trend toward outsourcing of aircraft maintenance, the debate will be interesting, according to mechanics, union officials and analysts.
"The large hub-and-spoke carriers are having the most trouble, and there's not much they can do," said John Pincavage, who follows the airline industry for Pincavage & Associates in Westport, Conn. "You can't de-hub: You shed revenue faster than you can cut costs."
It's been a year since American's unionized mechanics, pilots and flight attendants voted to accept $1.8 billion a year in wage and benefit reductions to keep American from filing bankruptcy. At the same time, airline management trimmed an additional $2.2 billion in costs -- closing terminals, cutting thousands of jobs and parking hundreds of airplanes in the desert.
But in the aftermath of Chief Executive Officer Gerard Arpey's campaign "Come Together, Win Together," many mechanics are unhappy.
Pat Kinnamon, an American mechanic in Tulsa and TWU shop steward, said the concessions cost him $946 a month in wages and benefits, and five vacation days. He said he accepted the lower standard of living until it became obvious -- with the revelations of executive perks and bonuses last spring -- that the sacrifices were not being shared.
"Whether you support the TWU or AMFA, we all want the same thing: we want the airline to be profitable; we want competitive wages and benefits; and we want to be able to trust the wise leadership of the company and union," Kinnamon said. "But with everything that's gone on, everybody has lost credibility and faith in the union and the leadership of the company."
AMFA, a craft union not affiliated with the AFL-CIO and founded 40 years ago by former American mechanic O.V. Delle-Femine, has gathered strength in proportion to the discontent at American, say officials of TWU and AMFA.
Don Rodgers, chairman of the AMFA organizing committee in Tulsa, is a former TWU shop steward and an American mechanic since 1997. He said he broke ranks with the TWU because the industrial union is not democratic.
"If you asked the wrong questions, you weren't welcome," Rodgers said. "When it became obvious to me that they were more interested in putting dues in the international's pocket or getting out of work or being more worried about politics than the membership's best interests, I decided I would just work on airplanes, learn my trade, do my eight hours and go home. Discontent is what breeds change."
Bob Owens, an American mechanic at JFK International Airport in New York, said in a recent e-mail that the TWU talks about democracy, but its actions say otherwise.
"Last year when we got that concessionary contract rammed down our throats by Jim Little (TWU air transport division director in Fort Worth) with his crooked voting system and his 'without further ratification' signature, several locals sued," Owens writes. "In court, the TWU said that we do not even have the right to vote on our contracts, it's the international's contract, and they can modify it as they see fit without our permission, and the court, after reviewing our constitution, agreed.
"All you have to do is look at the cover of the contract book. It states that the TWU owns this contract -- no individual local has jurisdiction. So while the TWU tells the members about how they are in control and the locals are autonomous, just look at what they say in court when the members or locals want to actually assert the rights they were led to believe they had. They say the direct opposite. Their own testimony exposes them for the liars they are."
Little calls his critics "Monday morning quarterbacks."
After TWU members ratified the five-year concessionary contract last spring, company and union negotiators agreed on three contract modifications that the membership didn't vote on.
They included reopening the contract in 2006 for possible amendments, the union's ability to swap contract provisions of equal value and management's ability to participate in a performance bonus program based on company profitability.
"We knew if we went to a revote, American would file for bankruptcy," Little said. "Everyone told me you don't want to go there -- it would be disastrous; 12,000 people would lose their jobs."
AMFA's tough talk about not accepting concessions is just hot air, he said.
"They haven't been there; they didn't do the financial analyses," Little said. "We hired a financial banking group, three attorneys knowledgeable about bankruptcy, a research analyst -- but no one could tell us that we would be better off in bankruptcy. The pilots did their own analysis, and they found it was uncertain whether American could survive bankruptcy."
Art Luby, a Washington, D.C., lawyer for the TWU, said AMFA leaders tell supporters that they would have taken the company into bankruptcy and forced it to prove its case.
"The company was losing $5 million to $7 million a day. There would have been a (bankruptcy) filing sometime in late spring," Luby said. "The company (without concessions) would have run out of capital to sustain itself. I'm not aware of any analyst who came up with a different position."
Delle-Femine has told American mechanics that AMFA does not accept wage and benefit concessions.
"Northwest asked for concessions last year, and we had an outside firm look at their books and we decided they didn't need them," Delle-Femine said. "We don't believe in giving any company we represent long-term concessions for short-term economic problems. We said, 'If you need help, we will give you a loan, and after a year if your profits are up, you pay it back.' "
AMFA, however, has represented mechanics at Northwest Airlines during the past five years when Northwest eliminated thousands of mechanics' jobs. In June 1999, when AMFA took over from the International Association of Machinists, 9,500 mechanics and related workers were employed at Northwest. About half have been laid off, retired or taken voluntary layoffs, officials said.
Today, 3,500 mechanics are members of AMFA Local 33 in Minneapolis, and Northwest has shifted heavy maintenance to bases in Singapore and China, said Jim Atkinson, president of Local 33.
"The disturbing thing for us is that all major airline mechanics in this country must go through a 10-year criminal background check by the FBI," Atkinson said. "That was initiated after 9/11.
"Our ongoing question to the federal government is what kind of background check is being done on the people in Singapore and China? It's a concern to us that we know the backgrounds of these people who have full access to the airplanes."
At American, mechanics agreed to wage and benefit cuts until 2008 in return for preserving jobs and the Alliance Airport maintenance base in Fort Worth and the Kansas City International Airport maintenance facility, company and TWU officials said.
"I think there are better times ahead and American, not being in bankruptcy, will be better able to adjust to the times ahead," Little said.
Senior TWU officers have been meeting once a month with Arpey and his senior staff to discuss issues of importance to mechanics, Little said. TWU officers also meet periodically with American's chief financial officer to review the company's books.
"We have their books analyzed by our financial people. That's unprecedented," Little said.
Some mechanics are uncomfortable with the close ties between management and union officers.
Dave Stewart, an American mechanic in Tulsa and co-chair of the AMFA organizing committee, said if TWU officials violate the constitution or the law, the membership can vote them out.
"But if they continue selling you out by signing off on secret letters of agreement with management, you can't do anything about it," Stewart said. "What happens then is that with no accountability of officers, you have no accountability of members, which leads to discipline and production problems."
The TWU has become a business that sells members life, medical, short-term disability and supplemental medical insurance, Stewart said.
"It has become an institution that is a business within itself," he said. "They make decisions not based on members' well-being but on institutional financial well-being."
Rick Mullings, spokesman for TWU Local 514 in Tulsa, said the union has saved jobs and preserved a tradition unique among U.S. airlines.
"American Airlines is the only airline left in the industry doing over 80 percent of its maintenance in-house," Mullings said. "Our union is all about protecting workers and their rights.
"AMFA's unwillingness to take part in Washington politics is very bad for their members. If you believe you are a union and all you do is collect dues and not represent members' interests in Washington, that is just foolish. It's pretty obvious which union is protecting jobs and their members' interests."
Members of both unions said they worry about the stability of the airline industry and the future of their profession.
"The professionalism, passion and loyalty to the individual and the company is dropping, and it scares me," Stewart said. "There's a strong argument that the continued erosion of pay and benefits for skilled technicians will eventually erode the safety margin that is provided for the flying public.
"I'm not saying it's not safe to fly today, but the continued erosion of pay and benefits is going to have an effect."
