An e-mail sent to Mr. Carty and Ms. Allen by a Flight Attendant found photocopied and distributed around the terminal. The name was blacked out. We can only assume it was authentic. Make you own determination.
Dear Mr. Carty & Ms. Allen,
As I take managements request of a pay wage freeze very seriously, before I am able to make an informed decision, I have heard evidence of lavish expenditures by management that I would like you to confirm or deny. This would assist me in reaching a decision on how to cast an informed ballot.
1. Not long ago, AA hired helicopters to drop orchids. If so, for what purpose was this done and what was the cost?
2. Jane Allen’s party of four boarded a flight bumping 4 first class passengers and 4 people were paid $300 each to get off (A-2 & A-4 pleasure trips force full-fare passengers off full flights). If this is standard operating procedure, don’t you think this is detrimental to our plight?
3. AA bought several cappuccino machines for flight which were not tested first and then found unusable. Not to mention the S-80 in flight automated PA system which also failed. How much was the combined total of these two mistakes?
4. AA is paying $16 a day for management to park at the terminal parking lot. Shouldn’t all employees be parking the in the employee parking lot to save costs?
5. We have flight service managers who have enough time to do grooming checks (sometimes 2 FSM’s per crew), observation rides (costs involved using resources to book the reservation, displacing revenue/non-revenue dollars and access to seats, as well as food/beverage, hotel costs and other misc. expense account charges), which do nothing but lower morale more than it already is. Is the length of my dress more important than the attitude I display to my passengers after a grooming check? I would like to know if these managers have received any training on morale and how to motivate employees because it certainly is not evident. Additionally I’d like to mention the absolutely ludicrous attendance policy which lowers our morale to the bottom of the charts. Lowering morale is the biggest mistake you can make as we have the most impact on passenger loyalty. Is this not our number one concern at this point?
6. For the 2002 election, airlines have given congressional candidates and the two major political parties $4.1 million, and last July, American Airlines executives gave more than $20,000 to a campaign fund that benefits House Minority Leader Richard Gephardt, D-MO, and other house Democrats.
7. AA is paying $14.6 million to upgrade the STL airport (preconditioned air to jetbridges, installing closed circuit tv in the terminals, and replacing carpeting in the terminals.) $1.1 billion dollars on the international terminal in DFW, $1.5 billion dollars on a terminal at Miami, and $1.3 billion dollars on a terminal at JFK. This is a total of nearly FOUR BILLION DOLLARS!! How much were you looking for again? We’ve told that it would be more expensive to halt these projects than to complete them. I would like actuary justification of these statements. Didn’t the AA legal Dept. provide for an escape close in the these contracts?
8. AA is paying $40 million over 20 years to put its name on the AA arena in Miami, $195 million over 30 years to have its name on the Dallas arena, and $8.5 million for the Roundabout Theater. (Please don’t tell me again that our legal dept forgot to put an escape clause in these contracts also.) Do you consider these upgrades & advertising essentials?
9. Mr. Carty received 6 months off his retirement for every year served at AAL and is now receiving his retirement 12 years early. It has also been reported that his retirement is around $80 million.
I can only imagine what other expenditures AA management deems “essential†to running this airline. It looks to me as if you are asking labor to pay for mistakes made by management.
Mr. Carty, as you refuse to share with your employees in good times and continue to spend money on frivolous management perks in bad times, I cannot with a good conscience vote to give up a raise which is already eroded by pre-funding installments, increased monthly medical/dental costs. The cost of living increase alone wipes out the entire raise. Let me quote someone who made an excellent observation, “We are losing $5-6 million per day. $130 million in pay freeze will be gone in 26 days. Then what?
Here are 2 additional quotes I would like to share:
11/23/02 USA Today:
“More than 40 U.S. steel companies, stuck with high fixed cost structures that make it hard to be nimble, have gone bankrupt in recent years. Yet Nucor continues to thrive. It pays its steelworkers $70,000 to $100,000 per year, far above the industry average. And it is have never gone through a layoff. “When business is bad, as its bound to occasionally be in a highly cyclical industry like ours, the first thing to go is every executive perk and bonus, followed by every plant manager and supervisor giving up theirs,†says Nucors CEO, Dan DiMicco.
In reference to competing with lower-cost carriers (ie Southwest): “Speaking of delusions, American would actually have to change its corporate culture, instead of just talking about it.†In a recent business book it was written, “Where a less farsighted businessman might have tried to keep costs down by treating his employees like dirt, Herb (Kelleher) understood that speed (in this case, quick turnarounds at the gate), safety and flexibility would do more to keep costs down than screwing with the employees. So, Southwest has the most heavily unionized workforce in the airline business. They are the happiest?†In fortune magazine, Kelleher himself wrote, “You have to treat your employees like your customers. When you treat them right, then they will treat your customers right. That has been a powerful competitive weapon for us.†Among other things, high morale equals high productivity. Its an intangible that adds to the bottom line and one that American, and most other premium carriers, has chosen to ignore. However, maybe what Carty really should be looking at is bringing down Americans executive compensation costs down to that of Southwest’s. Last year, AMR lost $1.7 billion, but Don Carty’s compensation package for 2001 was valued at $7.1 million. Southwest, on the other hand, actually earned a profit last year of $511.1 million. Its CEO, James Parker, had a pay package of $4 million. Hence, Carty’s pay package was 77.5% higher than Mr. Parkers. When comparing financial performance, the disparity between the two doesn’t quite make economic and justifiable sense. Perhaps Carty would think twice of intoning comparisons to Southwest if he knew the first thing to come down to the level of Southwest would be CEO pay.â€
I would truly love to hear both your responses regarding employee morale. Do you honestly not realize the impact that poor morale among Flight Attendants has on our customers?
I realize there are numerous and important questions here, but an answer to each would help the flight attendant workforce in our decision to forego our raise.
Thank you and I look forward to your prompt response.
***********************Name Removed************************
Dear Mr. Carty & Ms. Allen,
As I take managements request of a pay wage freeze very seriously, before I am able to make an informed decision, I have heard evidence of lavish expenditures by management that I would like you to confirm or deny. This would assist me in reaching a decision on how to cast an informed ballot.
1. Not long ago, AA hired helicopters to drop orchids. If so, for what purpose was this done and what was the cost?
2. Jane Allen’s party of four boarded a flight bumping 4 first class passengers and 4 people were paid $300 each to get off (A-2 & A-4 pleasure trips force full-fare passengers off full flights). If this is standard operating procedure, don’t you think this is detrimental to our plight?
3. AA bought several cappuccino machines for flight which were not tested first and then found unusable. Not to mention the S-80 in flight automated PA system which also failed. How much was the combined total of these two mistakes?
4. AA is paying $16 a day for management to park at the terminal parking lot. Shouldn’t all employees be parking the in the employee parking lot to save costs?
5. We have flight service managers who have enough time to do grooming checks (sometimes 2 FSM’s per crew), observation rides (costs involved using resources to book the reservation, displacing revenue/non-revenue dollars and access to seats, as well as food/beverage, hotel costs and other misc. expense account charges), which do nothing but lower morale more than it already is. Is the length of my dress more important than the attitude I display to my passengers after a grooming check? I would like to know if these managers have received any training on morale and how to motivate employees because it certainly is not evident. Additionally I’d like to mention the absolutely ludicrous attendance policy which lowers our morale to the bottom of the charts. Lowering morale is the biggest mistake you can make as we have the most impact on passenger loyalty. Is this not our number one concern at this point?
6. For the 2002 election, airlines have given congressional candidates and the two major political parties $4.1 million, and last July, American Airlines executives gave more than $20,000 to a campaign fund that benefits House Minority Leader Richard Gephardt, D-MO, and other house Democrats.
7. AA is paying $14.6 million to upgrade the STL airport (preconditioned air to jetbridges, installing closed circuit tv in the terminals, and replacing carpeting in the terminals.) $1.1 billion dollars on the international terminal in DFW, $1.5 billion dollars on a terminal at Miami, and $1.3 billion dollars on a terminal at JFK. This is a total of nearly FOUR BILLION DOLLARS!! How much were you looking for again? We’ve told that it would be more expensive to halt these projects than to complete them. I would like actuary justification of these statements. Didn’t the AA legal Dept. provide for an escape close in the these contracts?
8. AA is paying $40 million over 20 years to put its name on the AA arena in Miami, $195 million over 30 years to have its name on the Dallas arena, and $8.5 million for the Roundabout Theater. (Please don’t tell me again that our legal dept forgot to put an escape clause in these contracts also.) Do you consider these upgrades & advertising essentials?
9. Mr. Carty received 6 months off his retirement for every year served at AAL and is now receiving his retirement 12 years early. It has also been reported that his retirement is around $80 million.
I can only imagine what other expenditures AA management deems “essential†to running this airline. It looks to me as if you are asking labor to pay for mistakes made by management.
Mr. Carty, as you refuse to share with your employees in good times and continue to spend money on frivolous management perks in bad times, I cannot with a good conscience vote to give up a raise which is already eroded by pre-funding installments, increased monthly medical/dental costs. The cost of living increase alone wipes out the entire raise. Let me quote someone who made an excellent observation, “We are losing $5-6 million per day. $130 million in pay freeze will be gone in 26 days. Then what?
Here are 2 additional quotes I would like to share:
11/23/02 USA Today:
“More than 40 U.S. steel companies, stuck with high fixed cost structures that make it hard to be nimble, have gone bankrupt in recent years. Yet Nucor continues to thrive. It pays its steelworkers $70,000 to $100,000 per year, far above the industry average. And it is have never gone through a layoff. “When business is bad, as its bound to occasionally be in a highly cyclical industry like ours, the first thing to go is every executive perk and bonus, followed by every plant manager and supervisor giving up theirs,†says Nucors CEO, Dan DiMicco.
In reference to competing with lower-cost carriers (ie Southwest): “Speaking of delusions, American would actually have to change its corporate culture, instead of just talking about it.†In a recent business book it was written, “Where a less farsighted businessman might have tried to keep costs down by treating his employees like dirt, Herb (Kelleher) understood that speed (in this case, quick turnarounds at the gate), safety and flexibility would do more to keep costs down than screwing with the employees. So, Southwest has the most heavily unionized workforce in the airline business. They are the happiest?†In fortune magazine, Kelleher himself wrote, “You have to treat your employees like your customers. When you treat them right, then they will treat your customers right. That has been a powerful competitive weapon for us.†Among other things, high morale equals high productivity. Its an intangible that adds to the bottom line and one that American, and most other premium carriers, has chosen to ignore. However, maybe what Carty really should be looking at is bringing down Americans executive compensation costs down to that of Southwest’s. Last year, AMR lost $1.7 billion, but Don Carty’s compensation package for 2001 was valued at $7.1 million. Southwest, on the other hand, actually earned a profit last year of $511.1 million. Its CEO, James Parker, had a pay package of $4 million. Hence, Carty’s pay package was 77.5% higher than Mr. Parkers. When comparing financial performance, the disparity between the two doesn’t quite make economic and justifiable sense. Perhaps Carty would think twice of intoning comparisons to Southwest if he knew the first thing to come down to the level of Southwest would be CEO pay.â€
I would truly love to hear both your responses regarding employee morale. Do you honestly not realize the impact that poor morale among Flight Attendants has on our customers?
I realize there are numerous and important questions here, but an answer to each would help the flight attendant workforce in our decision to forego our raise.
Thank you and I look forward to your prompt response.
***********************Name Removed************************