Alaska Airlines Contracts With Menzies Aviation For Seattle Ramp Services
5/13/2005 3:15 a.m.
SEATTLE — As part of a continuing cost-management initiative to secure the airline's future, Alaska Airlines has contracted with Menzies Aviation to provide ramp services at Seattle-Tacoma International Airport.
Effective immediately, the move means the loss of 472 ramp service positions in Seattle held by company employees. Ramp services include loading and unloading baggage, and guiding aircraft to and from airport gates.
Alaska Airlines currently contracts with outside companies to provide ramp services in 41 of the 56 cities it serves. The decision to work with a service provider in Seattle is projected to save the airline more than $13 million annually.
"A decision of this kind, impacting people who have served this company well, is extremely difficult," Alaska's CEO Bill Ayer said. "But the ongoing turmoil in the airline industry, coupled with high fuel prices and pressure from low-cost carriers, puts us in a position where we must continue to find ways to reduce the cost of running our airline.
"Our success working with providers in other cities gives us confidence that we can continue moving Seattle customers' bags reliably while reducing our operating costs significantly," Ayer said.
The decision came after a lengthy evaluation process in which Alaska Airlines considered numerous options for saving money while improving the efficiency of the airline's ramp services. In addition to requesting proposals from outside providers, the airline conducted talks over a period of 20 months with the International Association of Machinists and Aerospace Workers (IAM) to discuss contract changes focused on achieving a more market-competitive rate for delivering these services to customers. "Unfortunately, we were unable to achieve a contract approaching the savings available from service providers," said Ed White, Alaska's vice president of ground operations.
"To ease the transition for affected employees, we are working with the IAM to offer a more lucrative severance package than that specified in the current contract," White said. In line with the severance offered to management, maintenance and fleet service employees last year, this package would include two weeks of base pay for each year of service; a cash bonus of $3,000 to $15,000 based on length of service; one year of company-paid health care coverage; and travel benefits for the employee and eligible dependents; in addition to a nine-week extension of current wages and benefits, as required by law. The airline also will provide information on outplacement assistance, career counseling, retraining resources and opportunities with other local employers.
Employees impacted by the Seattle decision will have the option to receive full company severance while applying for jobs with the new service provider. Still under negotiation with the IAM is the contract covering more than 450 ramp service, air freight and supply agents in the state of Alaska; nearly 140 air freight and supply agents in Seattle; and 13 supply agents in Los Angeles, Oakland, Phoenix, Portland and San Francisco. The airline plans to participate in mediated sessions with the union this summer focused on reaching an agreement with this bargaining unit.
Menzies Aviation is a global provider of ground handling services to more than 500 airline customers at some of the world's busiest airports. The company provides ramp services for Alaska Airlines in Los Angeles, Portland, San Francisco, San Jose and at all Mexican airports the airline serves.