eolesen is right about the pensions. They will be closed to new hires. Existing employees will not be cut off. That is a change that has been coming for a long time, and with LCCs growing market share it was sadly inevitable.
union power
- Thread starter Duke787
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Veteran
You apparently are not up to speed on the TWU and AA. New hires for now sets up the rest of us on future contracts.
Goose,
I'm not a forensic accountant, and I don't play one on TV. But, I'll give you what I see:
From the 2009 AMR Annual Report:
I expressed those numbers in their actual long form to emphasize the enormity of the new concession package that the TWU and AMR have agreed to be the best that a Union could negotiate.
Boomer
____________________________________________
From the AMR 2009 Annual Report, page(s) indicated:
Page 78:
The following benefit payments, which reflect future service as appropriate, are expected to be paid: Retiree Medical and Other Benefits:
YEAR DOLLAR AMOUNT
2010 $167,000,000.00
2011 $169,000,000.00
2012 $167,000,000.00
2013 $168,000,000.00
2014 $170,000,000.00
2015-2019 $971,000,000.00
10 Year Total $1,812,000,000.00
Boomer Comment:
Granted, the figures above reflect the entire obligation of AMR to every employee covered by Retiree Medical Insurance coverage and whatever “Other Benefits” might be: not just the TWU Retiree Medical. But it accurately reflects another 1.8 Billion, over a ten year period, of cost savings the company seeks from their employees in addition to the 1.6 Billion in annual wages and benefits granted in 2003 and not made whole.
___________________________________________________
From the AMR 2009 Annual Report, page(s) indicated:
Page 74: Retiree Medical and Other Benefits Account Balance:
Fair Value of Plan Assets:
2009: $206,000,000.00
Boomer Comment:
Granted, the figures above reflect the entire current balance to the obligation of AMR to every employee covered by Retiree Medical Insurance coverage and whatever “Other Benefits” might be: not just the TWU Retiree Medical. But it accurately reflects 206 Million in current asset value of the fund which Owens stated accrues to the number of 27 Million for AA. Using a reverse logic, 27 million of 206 million is 13.11%.
Going back to the future outlay AA cited in their 2009 Annual report and fitting the 13.11% to the 1.8 Billion of cost reduction over the future ten year period: $235,980,000.00 million in cost reductions without factoring in the value of the company match to the individual retiree medical prefunding that will now accrue to those 50 and over since the TWU and AA negotiated it away for those 49 and younger.
____________________________________________________
AA EEO Statement
From aa.com:
It is the expressed policy of American Airlines to provide equal employment opportunity to all employees and applicants for employment without regard to age, race, sex, gender, gender identity, color, religion, national origin, sexual orientation, disability or veteran status. American Airlines takes affirmative action to ensure that this policy is practiced in all personnel actions and conditions of employment, including but not limited to: recruitment, employment, training, promotion, transfer, demotion, termination, layoff, return from layoff, discipline, compensation, and benefits.
_____________________________________________________
From Jetnet, Policy and Proceedure: Retiree Medical:
Overview:
The Company matches after-tax contributions on a dollar-for-dollar basis. After-tax contributions, together with the Company's matching contributions, are deposited in a Voluntary Employees Beneficiary Association (VEBA) Trust. Assets of the trust can only be used to pay benefits.
Contributions:
Contributions, together with the Company’s matching contributions, are recorded in an individual account as part of a trust. There are three (3) separate trusts. One (1) is for TWU employees; one (1) is for Association of Professional Flight Attendants (APFA) employees; and one (1) is for non-union employees (Agents, Reps and Planners (ARP)). These trusts are operated according to IRS Code Section 501(c)(9) as Voluntary Employee Beneficiary Association (VEBA) Trusts. The trustee is State Street Bank & Trust. Under IRS rules for VEBAs, the Company cannot divert or use the funds for any purpose other than paying employee benefits. A team of investment Managers invests the funds in a manner similar to the Pension funds. Gains and losses on the investment of funds are allocated to your account. The value of your prefunding account is equal to the amounts you contributed (prefunding contributions) and associated investment experience.
Tax Advantages:
Prefunding offers several important tax advantages. No taxes are paid on investment returns credited to your account during your employment. No taxes are paid on investment returns, when the value of your account is used to purchase coverage for your retirement or disability. Thus, you pay no taxes on investment returns used to prefund your Retiree Medical Benefit (RMB) coverage. If the value of your account is paid out as a termination or death benefit (as explained in Death), you or your beneficiary pay taxes on the account's investment returns only at the time benefits are paid. The trust does not report investment returns earned by your account until it refunds contributions to you or your beneficiary. At that time, an IRS Form W-2 reports the taxable and non-taxable portions of your account to you and the IRS.
____________________________________________________
Boomer Comment:
The TWU forces dues payment as a condition of employment. The TWU International, not the Individual TWU Local, owns the contract as negotiated labor in a closed shop. AA enforces the portion of the current CBA covering the dues payment requirement by terminating TWU represented employees that refuse to pay dues.
The TWU and AA represent, through the M&R TA, to have us vote to relinquish a negotiated compensation and benefit based only on the age of the union member in violation of the AMR EEO policy and the duty of fair representation owed to the represented membership of the TWU as owner of the labor contract in the following manner:
1) AA represents that the employee prefunding, along with investment earnings, will be refunded to the individual accruing that benefit with the principal being non-taxed and the earnings on that principal being taxed;
2) AA represents that the AA retiree medical insurance match and those earnings associated with that match are held in an individual account and will be retained within the fund for the payment of retiree medical costs only for the TWU Retiree Medical Insurance coverage, and that the company match cannot be used for any other purpose than covering the members of the TWU VEBA Trust for whom they are held;
3) AA and the TWU represent, through the M&R TA, that only individual prefunding and individual prefunding earnings will be returned to the individual minus the taxes on the earnings of the principal and not the principal itself;
4) AA and the TWU represent, through the M&R TA, that the account bearing an individual identity will now be redistributed, soley based on the age of the individual union member, with those below 50 losing both the value of the investment in: a) the future compensation and benefit accrued from the individual retiree prefunding, and, B) the future compensation and benefit of the company match;
5) AA and the TWU represent, through the M&R TA, that the arbitrary age of 50 and over will allow that group of individuals, covered by the same union contract as the same group below 50, to receive: a) the benefit of the prefunding company match that was negotiated away for those below 50; and, B) receive the same compensation negotiated under the base bonus or the line base increase in pay;
6) AA represents, on the Jetnet Policy and Procedures site relating to retiree medical, that 10 years of continuous prefunding is required prior to the individual becoming eligible for retiree medical benefits through the combination of individual retiree medical prefunding and the company match;
7) AA and the TWU represent, through the M&R TA, despite an individual, below 50, having obtained the required continuous 10 year period of individual retiree medical prefunding and company match: the individual TWU Union Member will be deprived of a contractual benefit after the fact and the benefit will be transferred to another individual, 50 and over, TWU Union Member that may not have reached their 10 year individual prefunding requirement;
8) AA and the TWU represent, through the M&R TA, that in addition to losing a benefit after reaching the contractual terms required, the individual, below 50, TWU Union Member will be forced to pay-through use of the sick benefit accruals- to pay for a benefit negotiated for the individual, 50 and over, TWU Union Member without any form or type of compensation reasonably related to the concession contemplated;
9) AA states, in the 2009 AMR Annual Statement, that the value of the retiree medical prefunding is $206,000,000.00 and that over the next ten years AMR states that the cash outlays for retiree medical are $1,800,000,000.00;
10) The TWU, by bringing back this M&R TA, contemplate as the best they could negotiate: another 2 Billion in concessions by employees at AMR who receive Retiree Medical Insurance;
11) The TWU, by bringing back this M&R TA, contemplate as the best they could negotiate: forcing those that have earned a benefit to sacrifice to those who have not while failing to compensate those under 50 in the same manner as those 50 and above.
During no period of the current negotiations has the TWU or AA stated that these negotiations were pursuant to/or: conducted under the supervision of the Bankruptcy Court; contemplative of a planned reorganization under the Bankruptcy Code; contemplative of a pre-packaged filing under the Bankruptcy Code; and/or conducted under Section 1113 of the Bankruptcy Code.
Goose: I hope I answered the question about how this mess breaks for us, get back to me if it did not.
Mr. Boomer:
Thanks for the work - it is really appreciated. I did not expect you to put such an effort into this.
A quick once-over confirms much of what I had suspected would be the case from cursory reviews over time, but having been at the pulley works this pm, I'll have to wait 'til tomorrow to really make sense of it all - at this time (in particular) of night I'll admit to being as sharp as a bowling ball.
Thanx again - will digest on Wednesday.
Thanks for the work - it is really appreciated. I did not expect you to put such an effort into this.
A quick once-over confirms much of what I had suspected would be the case from cursory reviews over time, but having been at the pulley works this pm, I'll have to wait 'til tomorrow to really make sense of it all - at this time (in particular) of night I'll admit to being as sharp as a bowling ball.
Thanx again - will digest on Wednesday.
Thomas Paine
Veteran
- Sep 4, 2003
- 583
- 569
The problem is mechanics have been directed to 'not look' or confine their observations only to those things specified in the assigned task..
Its a divide and conquer stategy. Once the number of workers who dont have a DB outnumber those who do they will let them vote to take it away from the rest, in the meantime the executive pension plan remains in place.
I heard a guy recently say he was 50 years old so he "didnt have to worry about the retiree medical". I said to him "So are you are planning to retire within the next three years?" He said "No". I said "well in three years the number of people without prefunding will probably outnumber those with prefunding, what do you think is going to happen in three years? You will be three years older, and you will lose your prefunding, only now you wont have nearly enough time to bank enough sick time". His jaw nearly hit the floor.
Mr. Boomer (again):
It would appear the company and union are both trying to capitalize on this, according to your numbers.
Yes, I agree - age discrimination is quite rampant in this TA but, unfortunately, those who would be protecting the workers (the TWU) are also those who stand to profit. Like most everything else however, it's not illegal until a judge says it is - it's doubtful the TWU will spring for the legal representation to cut its own throat.
More later.
One of our board members called a lawyer already. But Boomer brings up some good points, especially when you add in the fact that what we have here is where one group, the over 50, can vote to take away not just the coverage, but the $5000 company match from the other group while leaving their share intact. The arguement that if its voted in that makes it legal doesnt seem to cover this. Its certainly not fair or equitable.
My biggest concern is that we get too hung up on this concession, because there are other things that are even worse, such as the ASMS, the inadequte adjustments, lack of restoration, permamnent probation and selection panels for Crew Chiefs, permanent discipline letters, the list goes on and on. If we focus on this they may try and pull it out in order to get the guys to buy off on it.
Bob,
You are entirely correct in pointing out all of the reasons this TA should be voted down; I was merely responding to a particular aspect of this rag.
Before I answered the question from Goose relative to the cost/benefit of a DBP versus the DCP, I thought it better to get a look at the manner by which Union Democracy descends to Mob Rule/Totalitarianism. Orwell, Animal Farm, "All animals are equal, but, some animals are more equal than others."
Ergo, my desire to place a no-compete clause in every TWU Union Locals' Bylaws applicable to both employment by the Company and the TWU Intenational.
I'll say it again - this TA stinks of age discrimination. I'm glad an attorney was consulted as I really don't believe it's legal to present this contract for a vote with the terms it contains re: age groups.
Good luck re: the "no-compete" clause.
I have zero problem with a no-compete clause as far as management but, although I understand the reasoning, I would be against the same clause for going into the International. I wouldnt have a problem with a clause that said before any elected official accepts an International appointment the membership must vote in favor of it but that should only be for appointments, however delegates should be free to see the lay of the land and run for office at the Convention.
What I've learned over the years is that its our structure, unique to TWU/AMR that makes us so screwed up. When I talk to guys from Local 100 , 556 or anyone outside of the AMR system they dont have the same problems we do. John Samuelson runs Local 100 and he has control over the contract. The MTA and the various other employers dont deal with the International, they deal with John and the Local 100 board, same goes for Local 556 and pretty much all the other Locals. Nothing gets agreed to unless John or Thom has a look at it first and they face elections. Unlike us where the ATD unilaterally makes agreements or rushes things through a Presidents council which removes accountability. We dont get an agenda ahead of time, instead things get introduced, usualyy a short debate, no time to really look at it and told we should vote in favor of it (like lobbying for anti-trust immunity in the BA-AA deal).
The ATD really doesnt get too involved in other carriers affairs, sometimes its referred to as the AA-TD. There will be no fix for the AA/ATD until we fix the problem of being fragmented into twenty one seperate locals with no coherant structure. The TWU at SWA has secured Industry Leading contracts, yet the TWUs performance here, at least as far as aircraft maintenance, is the opposite, we have pretty much the lowest compensation, worst workrules and worst benifits. AT SWA the Locals are set up along Craft lines, and it works well for them. Basically Local 555 and Local 556 are craft locals set up in an industrial union. We need to follow that same strategy if we ever expect to see any change. If we put a ban on allowing anyone from our Local to get into a position of power and influence then it pretty much leaves our members with only one option for change-leave.
Our TWU Union Brothers over in Title III have had their TA suspended because the Union Local Presidents were going to recommend a No vote. At least that is what James Little cited on the TWU website:
TWU WEBSITE :"TWU International President James C. Little, in reversing the actions of the fleet service bargaining team, which had decided to send the agreement to members with a “no” vote recommendation, said, “If we can’t recommend it, we’re not sending it..."
I guess this means that Fleet Service will now be able to watch the lemmings in Maintenance & Related walk over a cliff and that the Maintenance & Related will send their "TA" to the membership with a Yes Recommendation.
TWU WEBSITE :"TWU International President James C. Little, in reversing the actions of the fleet service bargaining team, which had decided to send the agreement to members with a “no” vote recommendation, said, “If we can’t recommend it, we’re not sending it..."
I guess this means that Fleet Service will now be able to watch the lemmings in Maintenance & Related walk over a cliff and that the Maintenance & Related will send their "TA" to the membership with a Yes Recommendation.
AANOTOK
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- Oct 10, 2009
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Hopeful
Veteran
- Dec 21, 2002
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I hate to break it to you, but if AA has the Mechanic & related on board, all the other title groups are gonna get screwed worse.
By this I mean if the mechanics vote yes, that is.
If NWA proved how easy it was to replace its mechanics, do you think it will be more difficult to replace the other title groups?
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