COUNCIL 41 UPDATE
SEPTEMBER 8, 2004
THE ROAD TO BAD-FAITH NEGOTIATIONS
Once again, the ALPA spin machine is running full tilt. The actions of the MEC at the recently concluded two-week long special MEC meeting in Washington need a lot of truthful explanation, something that has been sorely lacking.
After suffering for another three full months of “negotiations†with the company on what began a long, long time ago as the development of a supposed “transformation plan†to return US Airways to profitability, we discovered that, in fact, we were well past where we needed to be. You might rightfully ask, “How did we get here?â€
In December 2003, Dave Siegel (you remember him, don’t you? He was the person who wasn’t going to, “take my money and run,†yet that is precisely what he did) first began revisiting the Company’s supposedly good Plan of Reorganization. He first floated talk of additional concessions from employees. Remember the carrot of 60 brand-new Airbuses that evaporated as quickly as Siegel’s promise “not to take my money and run†when ALPA publicly announced that we were not interested in receiving any additional plans from Siegel involving more pilot concessions. Although Siegel was not invited to share any of his “plans,†Jerry Glass was eventually invited to do so by the MEC Chairman. This latest management proposal was to reduce CASM by an incredible 4 cents, with 2 of those cents coming from the employees.
This “Going-Forward†plan, as it was next dubbed, was pitched by none other than Mr. Bronner at a meeting in Charlotte that was held last February. Bronner made several statements at that meeting such as, “Those that give the most will share the most in the returns,†and, “We have only 15 to 45 days to execute this plan.†After that meeting the MEC passed a unanimous resolution directing the Negotiating Committee to “participate in developing a plan to return US Airways to profitability.â€
Even though we were told we didn’t have much time, things suddenly quieted down about the “plan†for the entire spring while the dust swirled around the passage of LOA 91 and Siegel’s decision to take the money and run. Once these issues were placed on the back burner, the bulldozer of transformation was once again started and shifted into high gear.
Just days after the votes on LOA 91 were tallied, and almost a full 90 days after Bronner and Lakefield met with the MEC in Charlotte, the Company finally unveiled their “Going Forwardâ€, now “Transformation Plan.†This was their strategy to cut costs at the airline by $1.5 billion; $800 million coming from the employees and the other $700 million from newfound efficiencies in the operation. The pilot’s share of their “pie†was announced as being $295 million.
Within the Company’s presentation were the targets the Company was seeking. Wage rates equal to America West, and productivity equal to JetBlue.
Once the Negotiating Committee began initial discussions with the Company during mid-May, NC Chairman Doug Mowery reported to the MEC in an update that “there’s no rush, we have the time to make sure we do this right,†indicating the Company had a target for completion of these negotiations as the end of September.
Yet, the very next day, MEC Chairman Bill Pollock arranged a special MEC conference call, telling us he had invited members of senior management to address the MEC to discuss the “urgency of the situation.†On this conference call, we were told that we needed to have a deal by the end of June.
For the next few weeks, the NC and Company engaged in preliminary informational exchange discussions. In fact, during this time period there were many times when the Company negotiators were either unavailable to meet or unprepared for discussing specifics at many meetings.
Once the NC made their first offer—an offer for a 12.5% pay rate reduction and forgoing of all raises for the duration of the agreement, there was virtually no acknowledgement by the Company of the value of this very significant move, and this then became the new “starting point†of negotiations—we could only go south from this opening position. They were interested only in what additional concessions we might offer; in other words, it was “business as usual†for them. It took several weeks for the Company to even begin working on a valuation of our proposal. Needless to say, they ultimately and incorrectly valued it at a significantly lower number than we did.
At that point in time, a discernable pattern also began to develop. Each new ALPA proposal was valued significantly lower by the Company than ALPA and our advisors had valued it. As the summer dragged on, each time Doug and the NC would move one step closer, the Company’s position would be to move one step back. The valuation would always drop, resulting in the now familiar, “We want more,†refrain from the Company.
In one negotiating meeting a bit of truth did slip out. When asked about the time frame for the Company’s $700 million share of the Transformation Plan’s cost cuts, Bruce Ashby and Dave Davis both stated that they would not get the $700M until the end of 2007. They then added that our ever-increasing share ($295M+) was needed right now.
ALPA’s proposal had now moved south from the original giveback to 16.25% pay-cuts, 10% lower DC contributions, and 10% lower vacation accrual. Management’s answer was, “Still not enough.â€
Finally, after a long summer of abuse at the hands of Ashby and others, as one deadline after another fell by the wayside, Doug Mowery declared on August 22, that the ability to reach an agreement with Management was not possible. At the time, MEC Chairman Pollock and all the advisors agreed. Doug informed the MEC in a telling metaphor that we had moved well past the 50-yard line, all the way to the Company’s 20-yard line, but they did not meet us there, they had backed into the end zone. Little did he know, they would soon continue backward—into the locker room, and then out to the parking lot.
In what was described as an attempt to move us from a deadlock, the MEC Chairman called yet another special MEC meeting in Washington, D.C. on August 25. The first order of business was a report from the NC. When the discussion began about the fact that the monetary figure the Company wanted was still increasing, several ALPA reps began a discussion about how we could make up more, thereby making excuses for the Company’s inexcusable behavior.
We then moved on to a re-charging of the Negotiating Committee. Your Philadelphia reps along with the Pittsburgh reps put forth a resolution attempting to limit the NC’s movements towards the Company’s ever more expensive positions. We felt that to do otherwise would only further whet the Company’s appetite for ever-increasing contractual concessions.
Once the debate began around the table, we were astounded to listen as the representatives from the other bases put forth an amendment to this resolution that would have directed the Negotiating Committee to, if unable to achieve a deal within those parameters, to simply obtain the best deal they could get. This action is tantamount to announcing publicly, “We will accept anything.†You wouldn’t get far if you approached even a car dealer with these words. This amendment was defeated by a roll call vote.
It was not a coincidence that the MEC Chairman called this meeting at a location in Washington that put us within a stone’s throw from Crystal City. The “Negotiations One†handbook states that it is a mistake to locate yourself in close proximity to your opponent. We should have been somewhere else, but there we were at the Key Bridge Marriott at a conservatively estimated cost of $15,000+ per day—a pretty high cost for an MEC that is allegedly broke. The meeting was finally recessed after the seventh day to the call of the chair, meaning until Pollock called us back into session. As a result, for the next six days, the entire MEC sat on a short leash in Washington awaiting the call to return to session. We had no idea that it would eventually turn into a thirteen-day siege.
As the Negotiating Committee continued, the Company’s proposals became even more draconian, 20% pay and 20% DC, then 21% pay and 40% DC. But, each time, the gap between ALPA and the Company would not close. No amount of money, pilot productivity, or contractual protections could possibly be shoveled into Ashby’s ever-changing bottomless pit. We were finally informed that the gap between the parties had decreased to “only†$30M. Yet, after Doug began shoveling even more into this gap, he was told the gap had now increased to $40M!
The last numbers that the Company put across the table were a 23% pay reduction, a 50% reduction in the DC percentage, onerous work rules and dependability programs, 50% pay for deadhead, 85/90/95 hour caps by position, no increase in the reserve guarantees, ad nausea. Several members of the MEC then offered a resolution to take this unacceptable proposal and send it out to the membership for a vote. Remember, the Negotiating Committee would not approve this proposal, and to bypass the MEC and put a proposal (not something the NC and MEC agreed with) out to the membership would effectively neutralize what little bargaining power your union demonstrated. In other words, we would be enabling the Company to bypass their bargaining agent and begin negotiations directly with the pilots themselves. “Separate the membership from their union representatives,†would become their rallying cry, a basic tenet of union busting, right out of the Lorenzo handbook.
If the foregoing isn’t enough, the content of this latest proposal was so far beyond what was originally proposed by the Company back in February (the America West wages and JetBlue block hours) that it played out, plain and simple, like a “land grab.†Please look this document over on the Pilot’s Only section of the ALPA website.
Keeping the interests of the Philadelphia pilots in mind, we could not sign off on this agreement. However, some MEC Officers and members are now attempting to paint these actions as an attempt to deny the membership a vote. THIS IS AN OUTRIGHT LIE!
What would have transpired under the foregoing scenario was a situation where the MEC could “wash their hands†of all responsibility and pass that on to the membership. “You signed on to it, not me,†and “You should have voted for/against it,†would become the buzzwords in defense of this indefensible action. We would not and will not be party to abrogation of our responsibilities as elected representatives. We felt it was the worst possible situation for the pilots, and voted that way.
THIS PROPOSAL IS THE RESULT OF CONTINUED BAD-FAITH BARGAINING ON THE PART OF BRUCE ASHBY AND JERRY GLASS AND SHOULD NOT BE WILLINGLY ACCEPTED BY ANY MAN.
NEGOTIATING COMMITTEE NOTES
Along the way, in order to keep the pilots informed, the MEC authorized the release of all confidential documents. Unfortunately, the only document to be released was the Glanzer Report. The Negotiating Committee notes from the negotiations were to be released also. These notes paint a very different, inside picture of what transpired behind the closed doors. Why just a partial release of information? This is a question for Chairman Pollock.
COMMUNICATIONS STRATEGIES
Along the way, the divide between the sides on the MEC became even more delineated. The MEC Chairman, using his bully pulpit and the Communications Chairman as his willing accomplice, have taken to using official communications such as the code-a-phone and press releases to misinform the pilots and the public of the intentions and actions of your representatives. To foster an atmosphere of such divisiveness at this time can only serve to weaken the position of the pilots as a group. You must ask these individuals why this is being done, for only they know the answer to that question.
Unfortunately, Mr. Lakefield has now stepped up to the plate to bash the PHL and PIT representatives. We are confident that MEC Chairman Bill Pollock will be asking the Department of Labor to have a look at what certainly appears to be management interference in the internal workings of our union. Please feel free to call Bill and ask him how and when he will be proceeding with this.
WHAT MIGHT BE NEXT?
Your representatives remain committed to achieving the goal of truly transforming this airline into a viable competitor. However, we will not be party to what ultimately took the form of an opportunistic and wholesale rape of the US Airways pilots’ working agreement. Any successful transformation can only be accomplished through the efforts of an enlightened management, working in concert with its workers, not through the use of threats and attempted intimidation.
In closing, we would like to thank all the pilots that have made the effort to call or write us with your messages of overwhelming support and confidence. If you have not yet received a personal response, we ask your continued patience.
Fraternally,
John Crocker, Chairman
Dan Von Bargen, Vice-Chairman
Ira Josephson
OUTLINE OF THE LAST COMPANY PROPOSAL
Across the board wage reductions of 23%, all future raises given up
DC Contributions reduced by 50%. Older pilots lose contributions up front. Younger pilots lose the power of compound interest to reach anywhere near their target.
Pay cap either 85, 90 or 95. Each base, airplane, and seat would have a different pay cap monthly dependent on the company’s needs. How can you plan your annual salary?
Deadhead at 50% pay. No IRO when not req’d by FARs.
This plays out to a situation where the IRO DHs to Europe, and then flies the return trip. A 12 hour three-day trip would result. Try getting your 85/90/95 in with a schedule like this.
No change to reserve guarantee – still 72/76
Elimination of retiree medical benefits. You can sell your sick bank back at retirement to buy this at the rate of $18 per hour of sick.
Elimination of retiree dental coverage. Eliminate drug coverage for all retirees, current and future
LTD will be limited to 2 years and you must pay 25% of the premium
Furlough protection gone – where do you think they might take this?
No meaningful returns, profit sharing will likely be wiped out in CH11
EMB 190/195s at other than mainline – these are 106 seat aircraft! Bruce Ashby has said he wants them for one reason…crew costs.
An onerous sick dependability program, only 60 hours of sick allowed annually, then your Chief Pilot will make a decision if you can continue to draw sick time or be placed on unpaid inactive status.
ONLY 60 DAYS OF 1113 PROTECTION!
SEPTEMBER 8, 2004
THE ROAD TO BAD-FAITH NEGOTIATIONS
Once again, the ALPA spin machine is running full tilt. The actions of the MEC at the recently concluded two-week long special MEC meeting in Washington need a lot of truthful explanation, something that has been sorely lacking.
After suffering for another three full months of “negotiations†with the company on what began a long, long time ago as the development of a supposed “transformation plan†to return US Airways to profitability, we discovered that, in fact, we were well past where we needed to be. You might rightfully ask, “How did we get here?â€
In December 2003, Dave Siegel (you remember him, don’t you? He was the person who wasn’t going to, “take my money and run,†yet that is precisely what he did) first began revisiting the Company’s supposedly good Plan of Reorganization. He first floated talk of additional concessions from employees. Remember the carrot of 60 brand-new Airbuses that evaporated as quickly as Siegel’s promise “not to take my money and run†when ALPA publicly announced that we were not interested in receiving any additional plans from Siegel involving more pilot concessions. Although Siegel was not invited to share any of his “plans,†Jerry Glass was eventually invited to do so by the MEC Chairman. This latest management proposal was to reduce CASM by an incredible 4 cents, with 2 of those cents coming from the employees.
This “Going-Forward†plan, as it was next dubbed, was pitched by none other than Mr. Bronner at a meeting in Charlotte that was held last February. Bronner made several statements at that meeting such as, “Those that give the most will share the most in the returns,†and, “We have only 15 to 45 days to execute this plan.†After that meeting the MEC passed a unanimous resolution directing the Negotiating Committee to “participate in developing a plan to return US Airways to profitability.â€
Even though we were told we didn’t have much time, things suddenly quieted down about the “plan†for the entire spring while the dust swirled around the passage of LOA 91 and Siegel’s decision to take the money and run. Once these issues were placed on the back burner, the bulldozer of transformation was once again started and shifted into high gear.
Just days after the votes on LOA 91 were tallied, and almost a full 90 days after Bronner and Lakefield met with the MEC in Charlotte, the Company finally unveiled their “Going Forwardâ€, now “Transformation Plan.†This was their strategy to cut costs at the airline by $1.5 billion; $800 million coming from the employees and the other $700 million from newfound efficiencies in the operation. The pilot’s share of their “pie†was announced as being $295 million.
Within the Company’s presentation were the targets the Company was seeking. Wage rates equal to America West, and productivity equal to JetBlue.
Once the Negotiating Committee began initial discussions with the Company during mid-May, NC Chairman Doug Mowery reported to the MEC in an update that “there’s no rush, we have the time to make sure we do this right,†indicating the Company had a target for completion of these negotiations as the end of September.
Yet, the very next day, MEC Chairman Bill Pollock arranged a special MEC conference call, telling us he had invited members of senior management to address the MEC to discuss the “urgency of the situation.†On this conference call, we were told that we needed to have a deal by the end of June.
For the next few weeks, the NC and Company engaged in preliminary informational exchange discussions. In fact, during this time period there were many times when the Company negotiators were either unavailable to meet or unprepared for discussing specifics at many meetings.
Once the NC made their first offer—an offer for a 12.5% pay rate reduction and forgoing of all raises for the duration of the agreement, there was virtually no acknowledgement by the Company of the value of this very significant move, and this then became the new “starting point†of negotiations—we could only go south from this opening position. They were interested only in what additional concessions we might offer; in other words, it was “business as usual†for them. It took several weeks for the Company to even begin working on a valuation of our proposal. Needless to say, they ultimately and incorrectly valued it at a significantly lower number than we did.
At that point in time, a discernable pattern also began to develop. Each new ALPA proposal was valued significantly lower by the Company than ALPA and our advisors had valued it. As the summer dragged on, each time Doug and the NC would move one step closer, the Company’s position would be to move one step back. The valuation would always drop, resulting in the now familiar, “We want more,†refrain from the Company.
In one negotiating meeting a bit of truth did slip out. When asked about the time frame for the Company’s $700 million share of the Transformation Plan’s cost cuts, Bruce Ashby and Dave Davis both stated that they would not get the $700M until the end of 2007. They then added that our ever-increasing share ($295M+) was needed right now.
ALPA’s proposal had now moved south from the original giveback to 16.25% pay-cuts, 10% lower DC contributions, and 10% lower vacation accrual. Management’s answer was, “Still not enough.â€
Finally, after a long summer of abuse at the hands of Ashby and others, as one deadline after another fell by the wayside, Doug Mowery declared on August 22, that the ability to reach an agreement with Management was not possible. At the time, MEC Chairman Pollock and all the advisors agreed. Doug informed the MEC in a telling metaphor that we had moved well past the 50-yard line, all the way to the Company’s 20-yard line, but they did not meet us there, they had backed into the end zone. Little did he know, they would soon continue backward—into the locker room, and then out to the parking lot.
In what was described as an attempt to move us from a deadlock, the MEC Chairman called yet another special MEC meeting in Washington, D.C. on August 25. The first order of business was a report from the NC. When the discussion began about the fact that the monetary figure the Company wanted was still increasing, several ALPA reps began a discussion about how we could make up more, thereby making excuses for the Company’s inexcusable behavior.
We then moved on to a re-charging of the Negotiating Committee. Your Philadelphia reps along with the Pittsburgh reps put forth a resolution attempting to limit the NC’s movements towards the Company’s ever more expensive positions. We felt that to do otherwise would only further whet the Company’s appetite for ever-increasing contractual concessions.
Once the debate began around the table, we were astounded to listen as the representatives from the other bases put forth an amendment to this resolution that would have directed the Negotiating Committee to, if unable to achieve a deal within those parameters, to simply obtain the best deal they could get. This action is tantamount to announcing publicly, “We will accept anything.†You wouldn’t get far if you approached even a car dealer with these words. This amendment was defeated by a roll call vote.
It was not a coincidence that the MEC Chairman called this meeting at a location in Washington that put us within a stone’s throw from Crystal City. The “Negotiations One†handbook states that it is a mistake to locate yourself in close proximity to your opponent. We should have been somewhere else, but there we were at the Key Bridge Marriott at a conservatively estimated cost of $15,000+ per day—a pretty high cost for an MEC that is allegedly broke. The meeting was finally recessed after the seventh day to the call of the chair, meaning until Pollock called us back into session. As a result, for the next six days, the entire MEC sat on a short leash in Washington awaiting the call to return to session. We had no idea that it would eventually turn into a thirteen-day siege.
As the Negotiating Committee continued, the Company’s proposals became even more draconian, 20% pay and 20% DC, then 21% pay and 40% DC. But, each time, the gap between ALPA and the Company would not close. No amount of money, pilot productivity, or contractual protections could possibly be shoveled into Ashby’s ever-changing bottomless pit. We were finally informed that the gap between the parties had decreased to “only†$30M. Yet, after Doug began shoveling even more into this gap, he was told the gap had now increased to $40M!
The last numbers that the Company put across the table were a 23% pay reduction, a 50% reduction in the DC percentage, onerous work rules and dependability programs, 50% pay for deadhead, 85/90/95 hour caps by position, no increase in the reserve guarantees, ad nausea. Several members of the MEC then offered a resolution to take this unacceptable proposal and send it out to the membership for a vote. Remember, the Negotiating Committee would not approve this proposal, and to bypass the MEC and put a proposal (not something the NC and MEC agreed with) out to the membership would effectively neutralize what little bargaining power your union demonstrated. In other words, we would be enabling the Company to bypass their bargaining agent and begin negotiations directly with the pilots themselves. “Separate the membership from their union representatives,†would become their rallying cry, a basic tenet of union busting, right out of the Lorenzo handbook.
If the foregoing isn’t enough, the content of this latest proposal was so far beyond what was originally proposed by the Company back in February (the America West wages and JetBlue block hours) that it played out, plain and simple, like a “land grab.†Please look this document over on the Pilot’s Only section of the ALPA website.
Keeping the interests of the Philadelphia pilots in mind, we could not sign off on this agreement. However, some MEC Officers and members are now attempting to paint these actions as an attempt to deny the membership a vote. THIS IS AN OUTRIGHT LIE!
What would have transpired under the foregoing scenario was a situation where the MEC could “wash their hands†of all responsibility and pass that on to the membership. “You signed on to it, not me,†and “You should have voted for/against it,†would become the buzzwords in defense of this indefensible action. We would not and will not be party to abrogation of our responsibilities as elected representatives. We felt it was the worst possible situation for the pilots, and voted that way.
THIS PROPOSAL IS THE RESULT OF CONTINUED BAD-FAITH BARGAINING ON THE PART OF BRUCE ASHBY AND JERRY GLASS AND SHOULD NOT BE WILLINGLY ACCEPTED BY ANY MAN.
NEGOTIATING COMMITTEE NOTES
Along the way, in order to keep the pilots informed, the MEC authorized the release of all confidential documents. Unfortunately, the only document to be released was the Glanzer Report. The Negotiating Committee notes from the negotiations were to be released also. These notes paint a very different, inside picture of what transpired behind the closed doors. Why just a partial release of information? This is a question for Chairman Pollock.
COMMUNICATIONS STRATEGIES
Along the way, the divide between the sides on the MEC became even more delineated. The MEC Chairman, using his bully pulpit and the Communications Chairman as his willing accomplice, have taken to using official communications such as the code-a-phone and press releases to misinform the pilots and the public of the intentions and actions of your representatives. To foster an atmosphere of such divisiveness at this time can only serve to weaken the position of the pilots as a group. You must ask these individuals why this is being done, for only they know the answer to that question.
Unfortunately, Mr. Lakefield has now stepped up to the plate to bash the PHL and PIT representatives. We are confident that MEC Chairman Bill Pollock will be asking the Department of Labor to have a look at what certainly appears to be management interference in the internal workings of our union. Please feel free to call Bill and ask him how and when he will be proceeding with this.
WHAT MIGHT BE NEXT?
Your representatives remain committed to achieving the goal of truly transforming this airline into a viable competitor. However, we will not be party to what ultimately took the form of an opportunistic and wholesale rape of the US Airways pilots’ working agreement. Any successful transformation can only be accomplished through the efforts of an enlightened management, working in concert with its workers, not through the use of threats and attempted intimidation.
In closing, we would like to thank all the pilots that have made the effort to call or write us with your messages of overwhelming support and confidence. If you have not yet received a personal response, we ask your continued patience.
Fraternally,
John Crocker, Chairman
Dan Von Bargen, Vice-Chairman
Ira Josephson
OUTLINE OF THE LAST COMPANY PROPOSAL
Across the board wage reductions of 23%, all future raises given up
DC Contributions reduced by 50%. Older pilots lose contributions up front. Younger pilots lose the power of compound interest to reach anywhere near their target.
Pay cap either 85, 90 or 95. Each base, airplane, and seat would have a different pay cap monthly dependent on the company’s needs. How can you plan your annual salary?
Deadhead at 50% pay. No IRO when not req’d by FARs.
This plays out to a situation where the IRO DHs to Europe, and then flies the return trip. A 12 hour three-day trip would result. Try getting your 85/90/95 in with a schedule like this.
No change to reserve guarantee – still 72/76
Elimination of retiree medical benefits. You can sell your sick bank back at retirement to buy this at the rate of $18 per hour of sick.
Elimination of retiree dental coverage. Eliminate drug coverage for all retirees, current and future
LTD will be limited to 2 years and you must pay 25% of the premium
Furlough protection gone – where do you think they might take this?
No meaningful returns, profit sharing will likely be wiped out in CH11
EMB 190/195s at other than mainline – these are 106 seat aircraft! Bruce Ashby has said he wants them for one reason…crew costs.
An onerous sick dependability program, only 60 hours of sick allowed annually, then your Chief Pilot will make a decision if you can continue to draw sick time or be placed on unpaid inactive status.
ONLY 60 DAYS OF 1113 PROTECTION!
)
