Andy,
When did the f/as vote for a Transition Agreement???
I was informed that the joint negotiating committee is still negotiating a "transition agreement", and once they obtain a completed agreement it will go out to all f/as for a vote. The East MEC voted last year to share with West f/as the "profit sharing" provision from the East contract whereby increasing the pool of f/as to share their 14.5% which is $8.5 million. Which means instead of approx 4,700 f/as sharing in the East operation profits, the approx 3,000 f/as from the West will share in a profit sharing plan that encompasses profits from West operation AND the East operation. The Company would not negotiate a separate profit sharing for the West and establish their own West pool from the profits made by the West operation.
Please clarify your above statment.
The JNC is negotiating our
Merged Contract and once they have that completed it will be sent to all US Airways Flight Attendants to ratify. The
Transition Agreement was drafted by the Company and the AWA MEC and USA MEC…
The East MEC decided to include the West Flight Attendants in the profit sharing plan as part of the Transition Agreement. Most of the other labor groups have included their West counterparts in the profit sharing plan. AFA's decision to include the West Flight Attendants in the plan was decided by the East MEC in January 2006.
HOW DID THE PROFIT SHARING PLAN COME ABOUT? (USA/MEC E-line)
The profit sharing plan was originally introduced to the employees by the Company, then controlled by the Retirement System of Alabama (remember them), prior to the September 2004 bankruptcy filing. The plan proposed at the time was to pay 10% of the pre-tax profits for margins between zero and 5%, and 25% of pre tax profits for margins above 5% Then CEO, Bruce Lakefield, described the plan as "industry leading", but it would only be implemented if the Company could reorganize outside of bankruptcy.
Initial Company proposals to all labor groups were so outrageous it became clear there would be a lengthy negotiations process. In short, the initial plan was an attempt to buy the labor groups off. AFA recognized the first contract proposal the Company wanted us to accept was so bad that we would never agree to the terms.
The playing field changed dramatically once US Airways declared bankruptcy in September of 2004. As the bankruptcy case progressed one fact became clear-without outside investors the Company would fail. The profit sharing plan then became contingent on acceptance by any potential investors, and more importantly, became conditional on what is known, in bankruptcy law, as the "Plan of Reorganization" (POR). The Company then watered down the plan in order to satisfy the creditors and investors. The new plan and its terms (what we have today) was offered to the labor groups with the proviso it would only become a reality if the POR was approved. The plan formula and payout stipulations were not the result of negotiations between the Company and AFA or any other labor group but rather the result of the court, the investors and the creditors. The only latitude AFA was afforded was to determine who would be considered "an eligible Flight Attendant" in order to receive a profit sharing payout.
The merger between America West and US Airways ultimately provided the investment opportunity that saved both airlines. The investment community believed the merger would provide a viable airline; the money poured in based on the merger outlook that included, among other "synergies", the watered down version of the original profit sharing plan. The court approved the POR, which included the revised profit sharing plan, based on the merger and the acceptance of the POR by the investors and creditors.
