Since your hell bent on blaming the IAM for the outsourcing at US let me give you some education on the matter, and hopefully this will change your tune.
I know I can come across at abrasive, but I have tried to explain this to you and others over and over and I get frustrated as you and others don’t seem to let what happened sink in and understand what has transpired.
After US bought Piedmont and PSA almost everything was done in-house. PSA had a fantastic engine shop and was the exclusive overhaul for the RB211 in North America if an airline vendored out engines for overhaul. PSA also had the tooling for overhaul the CFM56s.
US bought PSA and primarily shutdown Aeromotive, which was PSA engine shop.
After the mergers the airline did all airframe overhauls, landing gear except for the 767 and the 757s didn’t come into the fleet until the 90s. We had shops in INT, GSO, PIT and CLT for component overhaul and the JT8s and the Tays were overhauled in-house and the CFM56s were outsourced.
The IAM filed a grievance on the CFM56 outsourcing we had pictures of the tooling and fixtures that PSA had for the overhaul. The case went to arbitration and we lost as the arbiter ruled that US didn’t have the tooling to accomplish the work, even though we had the pictures and testimony of Plant Maintenance Mechanics and Engine Mechanics who were original PSA.
So US buys PS and PI and then in the early 90s starts to hemorrhage cash, as you all need to remember US was the smallest of all the Major Airlines and was nicely protected in the Northeast, but now had to compete on the national and international scale.
British Airways and Warren Buffet gave a cash infusion Buffet’s investment was $300 million I can’t remember BA’s amount, but in the BA deal we Wet Leased three 767s and painted them in their liveries, but was worked and staffed by US employees.
In the early 90s US closed a bunch of maintenance stations, hangars in INT, which moved to CLT, GSO which moved to CLT and the hangar in ILM was closed, that’s where the 737-300/400 engine balance check was done.
The closing of the bases was just what happened in maintenance, at the time the ramp and csa were non-union and the company devastated them, they lost Express work, most of catering, mail and freight. They downgraded 40% to part-time, took away their vacation, sick time, OJI protections, and froze their pension.
We were unionized and they couldn’t do that to us, we were in contract negotiations at the time which stated in 1989 and ended in 1992 with a strike and a new CBA which we took pay cuts, and some other small concessions ,but no work was lost nor was their layoffs. After the year was up we got 100% of our concessions back in a lump sum and we got stock options, and in year two we also got another 100% concession bonus back.
When we came back from the strike there was a backlog of overhaul and AD compliance issues, the 737 Forward Bulkhead Pressure mods, and the company approached the union as we had a bunch a 732s, some 737s and several 757s that were out of time, to vendor out some of the overhaul and mods, and we flatty refused. Once again standing up for the workers and not allowing outsourcing.
Fast forward then Stephen Wolf takes over the airline, spruces it up, invests in maintenance and the planes. We got a bunch of new equipment to benefit overhaul, line and stores. Even got a new line hangar built in CLT, and a C-check/phase hangar in TPA was built for the airbus Cs and 737s.
Things were running well, then 9/11, SARS and the fuel crisis hit, Wolf resigned, and Gangwal took over and US was still bleeding cash. So Gangwal left and brought in Dave Siegel as the new CEO as all unions were in concessionary bargaining from about June of 2002 till August, ALPA reached a concessionary deal, the AFA, CWA, IAM and TWU did not. One Sunday morning the company came into the negotiating room and threw a final offer on the table and said take it or leave, we are filing Chapter 11 this afternoon to prevent the leaseholders and other creditors from forcing a Chapter 11 filing. So US filed Chapter 11 the first time on a Sunday afternoon at the Bankruptcy Court in Alexandria, VA.
Texas Pacific (who saved CO and HP in Chapter) was our DIP financier and plan sponsor. The Retirement Systems of Alabama run by Dr David Bronner, had a bunch of US debt and leases, he outbid Texas Pacific Group and became our DIP and new owners. We voted on the final offer and it was voted down. Dave Siegel then went behind the IAM’s back and sent letters to each member and their spouse telling them he was going to hold his own vote or seek abrogation. The IAM International decided to have a revote to prevent an abrogation (which I was totally against), upon the revote concessions were ratified, with minimal job loss and no loss of Scope language.
So right before Christmas of 2002 US wasn’t doing well financially and Dr Bronner threatened to liquidate US if all the unions didn’t take concessions again. So by February we agreed to a second round of concessions to prevent US from going out of business. The concessions from the IAM Mechanic and Related employees was about $367 million a year. And once again, we didn’t lose scope.
The ink wasn’t even dry nor were the I’s dotted and the T’s crossed and US filed a grievance against the IAM to allow US to outsource the Airbus S-Check, which is the five year heavy maintenance check.
They sent several planes, wanting up to ten to Singapore Aerospace Technologies in Mobile, AL for overhaul. Funny how we were owned by RSA and they chose a foreign owned company in Alabama for overhaul.
We filed a Federal Major Dispute lawsuit and won, and the company was forced to stop work at ST MAE. They did get permission to finish the plane that was apart. And as a side note, the work at ST MAE was complete garbage, the first plane they did made several emergency landings due to improper flight control rigging, so our IAM represented mechanics had to redo their work to make the planes safe.
US filed an appeal and on appeal was successful in getting the TRO removed and proceeded to still outsource, but the appeals court remanded the case to arbitration and upon the arbitration the IAM was successful and won. It was about a $400 million award and would have made US increase the mechanic headcount in order to do the work in-house.
US filed chapter 11 once again, and the award was forced into a claim in court and never paid as the judge wiped it out. And we got the same judge in the second bankruptcy case as we did in the first, and even though the IAM and AFA petitioned the court for Judge Mitchell to recluse himself, he refused.
US filed the second time and we started negotiations in November. Big division on the committee, PIT was willing to sacrifice Utility and CLT wasn’t.
Main reason for utility being outsourced was the company didn’t want to manage them, with all the problems, attendance, late, and not doing their job. Wildcat strike in LGA when agents were cleaning planes under the direction of the station manager all walked out except the shop steward.
We gave the company a full CBA which protected and added utility at the hubs and the 10 of 15 largest stations. Company rejected it.
We also gave them a full comprehensive plan to keep all the overhaul and shops, which they refused as they didn’t want to employ people and manage them.
We never reached an agreement and the judge abrogated our CBA and forced us to vote on the final offer or he would impose the company’s original offer which was worse. As they wanted to layoff 46% of the workforce, have unlimited outsourcing and terminate our pension. The members approved the final offer, as they voted for their severance.
So you all praise AMFA for taking the same stance at NW as the IAM did at US, but you all blame and chastise the IAM at US for what happened.
When a company files chapter 11, the unions have no position of power, as due to the NW winning a case against the AFA that prevented a union from striking when their CBA is abrogated.
We got no equity or anything to compensate us for our losses.
So it took the courts system to abrogate our CBA for US to gain the right to outsource as much as they wanted. As the IAM never agreed to any outsourcing.
Which the company did and had a massive layoff and an early out package.
So fast forward to 2008 when the IAM was able to reach a Transition Agreement with the HP merger, which the IAM was successful in bringing back 50% of Airframe Overhaul in-house, from 2005-2008 US had unlimited outsourcing and put a formula in place to ensure US was in compliance with 50% of billable hours of airframe in-house.
The first Section 6 negotiations since bankruptcy didn’t occur until 2011 or 2012, and while in negotiations US wouldn’t budge so we had to go into Mediated Negotiations with a mediator from the NMB.
Then the merger was taking place and the company wanted to stop Section 6 Negotiations and proceed into JCBA negotiations with the IAM and TWU. The IAM learned its lesson on doing that at UA/CO which failed the members. So the IAM with the backing of the TWU refused to go into JCBA negotiations before the IAM was able to reach a Section 6 agreement.
So because of the merger and the impending JCBA negotiations going to take place, the IAM was able to reach a bridge agreement to get them into JCBA talks, so the IAM informed the members of the new tactic of a bridge agreement as the company wasn’t willing to budge and the Mediator explained to the company they were going down the path of bad faith negotiations. So a bridge Section 6 CBA was agreed to and ratified by the members.
Sorry about the lengthy post, but people forget US was the smallest major and was bleeding cash for over a decade at times. And wasn’t on the same level as AA, CO, DL, NW and UA. The IAM did the best they could with the circumstances we were all faced with. But the laws are written to protect the companies and the creditors not the union and its members.
