Unions. Food for thought.....

[700UW]

Yes, the laws were changed, but the only material change I see with S1113 is that there has to be a hearing and an attempt to settle consensually first. It slows down the process by a couple weeks, and since most bankruptcy judges are crooked and on the take, it's a rubber stamp once the hearing is held and the union's demands are ignored.

Seriously, has there been a case where a management team hasn't gotten their way in a S1113 proceeding? I really can't think of one.

I do hope you guys don't have to find out firsthand, but that seems to be more and more likely every day oil stays above $100...

Your time line is way off.

At US when I was on the Negotiating Committee during the second bankruptcy, it took over three months of negotiations, before the Section 1113 hearing was held and out CBA abrogated, it doesnt happen in a couple of week.

I was there, and lived, you werent.

 

[xUT]

FYI,
Hope you guys N gals don't got BK.
You won't like it, trust me.
B) xUT

 

[eolesen]

Your time line is way off.

At US when I was on the Negotiating Committee during the second bankruptcy, it took over three months of negotiations, before the Section 1113 hearing was held and out CBA abrogated, it doesnt happen in a couple of week.

I was there, and lived, you werent.

You missed the overall sarcasm of my post... but you're correct that the few times S1113 has been invoked, it has been measured in months.

If AA files for bankruptcy before there's a TA, I suspect it will be closer to what happened to the FA's at NWA if they can't quickly come to a resolution post-filing.

I also believe it's just a matter of time before we see a case where a judge decides that negotiations held pre-filing meet the intent of the good-faith requirement, and that the potential for reaching a consensual agreement has already run its course.


I'm glad you were able to delay the inevitable by a couple months. But the fact was it was your second trip thru bankruptcy in 18 month. There was probably an argument to be made that you gave enough during the first trip. That won't be true for anyone entering bankruptcy now.

Since you were there, what did consensual negotiations achieve for the employees? How much real negotiating was there? Did management simply do the good-faith negotiating required by statute, and then turn around and ask for what they wanted from the judge?... Or did you manage to soften up their position from Day One of consensuals to Day X in front of the judge?

 

[WorldTraveler]

Yes, the laws were changed, but the only material change I see with S1113 is that there has to be a hearing and an attempt to settle consensually first. It slows down the process by a couple weeks, and since most bankruptcy judges are crooked and on the take, it's a rubber stamp once the hearing is held and the union's demands are ignored.

Seriously, has there been a case where a management team hasn't gotten their way in a S1113 proceeding? I really can't think of one.

I do hope you guys don't have to find out firsthand, but that seems to be more and more likely every day oil stays above $100...

It is the company's prerogative to devise its OWN plan of reorganization and present it to the court before any other plan can be presented.
Only in the event that management is unable to devise its own reorganization plan do other parties get their chance.
.
Sarcasm or not, do you have any evidence to support your claim about bankruptcy judges or is that just filler that really shouldn't have been written at all?
.
What is accurate is your statement that bankruptcy judges in AA's case are very likely to see the NMB's longstanding participation in AA and its unions talks as evidence that the process has been subjected to scrutiny and negotiation - yet without allowing the company to achieve its goals and while AA's financial and competitive situation has deteriorated.
.
And it is not true that there is no reason to not participate in the discussions because the company will impose what it wants. If the unions can't come up w/ a plan, then that is absolutely certain. If the company and the union come up w/ two different plans that reach the same bottom line but reach it in very different ways, then the judge will absolutely consider labor's proposal.
.

 

[700UW]

Doesnt work that way Eric, the process doesnt start until the company files their section 1113 motion, this has been tested all ready.

Per Sharon Levine, Esq, one of the top Bankruptcy lawyers who specializes in the RLA, explained all of this to us when US filed.

 

[eolesen]

I appreciate the advice your legal counsel gave you at the time, but how many examples of S1113 proceedings were there with airlines in 2004?

The most serious S1113 hearings were probably the rounds you guys went thru the first time, and it just escalated from there into your second proceeding, and then the UAL and NWA proceedings in 2005/2006.

Maybe I'm missing something, but most of the case law seems to have come well after your briefing from Ms. Levine...

I'm just throwing out the possibility that a shortened timeline might indeed happen at some point, especially if you have a carrier who has been in a protracted and unresolved Section 6 negotiations at the time they file.

If you look at the letter of the law, there is nothing that establishes a timeline for the good-faith negotiations to take place, aside from the 10 days notice required in advance of the hearing, and no later than 14-21 days later unless otherwise agreed to by all parties.

http://www.law.cornell.edu/uscode/usc_sec_11_00001113----000-.html


Back to an earlier comment... Even Robert Roach of the IAM seems to believe that S1113 is delaying the inevitable....

http://republicans.judiciary.house.gov/hearings/pdf/Roach100525.pdf

Section 1113 of the current law has deteriorated the collective bargaining process, not enhanced it. It does not offer the employee protections Congress envisioned in 1984. Section 1113 only provides a checklist of perfunctory steps that must be followed before a judge can reject a labor contract. It does nothing to encourage good-faith bargaining.

It's probably worth pursuing reform to allow self-help, further define the timelines for self-help, and to place some checks & balances on executives, as spelled out in the IAM's testimony, all of which look entirely reasonable to me.

 

[Hopeful]

We could read and interpret the bankruptcy code day after day...The bottom line is, employees ALWAYS get screwed the worst......Creditors and investors next.
This whole debate on whether or not AA SHOULDA, COULDA, WOULDA,,,,,is tiresome.
I would be willing to wager a nice bet that in the event AA filed for bankruptcy protection, what they will ask for with respect to labor agreements will go far deeper than ANY offer to ANY union to date!

if anyone believes that if AA files that OH will be spun off and line mechanics will be paid like UPS really need to see a doctor.
AA WILL SCREW EVERY WORKER......UNION AND NON UNION ALIKE...ANYONE WHO IS NOT IN MANAGEMENT WILL FEEL THE PAIN BEYOND IMAGINATION.

I say, let them...
AA will have a worse morale problem so bad and irreversible, the flying public will stay away from it whenever possible.

Bankruptcy will only relieve debt and those "oh so burdensome labor contracts."
Bankruptcy will not magically make AA a preffered or better carrier as long as the AArogant management team is in place.

Maybe AA does not wish to file for Chapter 11 because we still have a Democrat President and a Democrat controlled Senate?

Maybe the AArogant managment team is waiting, hoping and praying that the next election turns all three branches of government over the GRAND OL UNION-BUSTING PARTY!

Again, I hope all AA employees join me in congratulating our exceptional management team and wishing them much happiness as they are about to receive their annual PUP pay......!

 

[700UW]

We had our CBA abrogated in the second Bankruptcy, I was there, lived it and got the t-shirt to prove it.

We didnt have a Section 1113 hearing in the first bankruptcy, it was the second, and I was in the courtroom for all the proceedings from day one, till the end, and on the Negotiating Committee through the whole process, including the 1114 hearings and assisting their committee.

The Judge and attorneys have all established the process starts after the motion is filed, otherwise the law isnt retroactive under Section 1113. It starts when the company files it and face to face negotiations start.

 

[Hopeful]

We had our CBA abrogated in the second Bankruptcy, I was there, lived it and got the t-shirt to prove it.

We didnt have a Section 1113 hearing in the first bankruptcy, it was the second, and I was in the courtroom for all the proceedings from day one, till the end, and on the Negotiating Committee through the whole process, including the 1114 hearings and assisting their committee.

The Judge and attorneys have all established the process starts after the motion is filed, otherwise the law isnt retroactive under Section 1113. It starts when the company files it and face to face negotiations start.

Gee, go figure!
TWO BANKRUPTCIES!

I thought bankruptcy was to help the company re-organize by screwing workers, creditors and investors????????????
Isn't that the pro-corporate-anti-union take on this? That companies need to abbrogate labor agreements?
What went wrong? The first bankruptcy didn't screw enough people?

 

[Interested]

700UW, how was the moral at United after the BK's?

Hopeful claims "I say, let them...
AA will have a worse morale problem so bad and irreversible, the flying public will stay away from it whenever possible".

Did the flying public stay away from you whenever possible?

 

[TIME FOR CHANGE]

Either way, the fact that there's a precedent means you're looking at an injunction and damages the moment you try to walk out after a S1113 proceeding. Maybe it's still worth doing. But if it risks bankrupting the union in the process, I'd advise you to think twice about it.

At least we could rid ourselves of the twu and the overpaid ATD officers. You may be on to something... 🙄

 

[700UW]

I was at US not UA, and the morale sucked and still does.

Yep the POR failed and Judge Rubber Stamp Mitchell was the judge in both cases.

Yep they didnt screw us enough in the first, so they filed the second. One of the reasons was to get rid of the Airbus Arbitration that we won.

 

[Bob Owens]

Gee, go figure!
TWO BANKRUPTCIES!

I thought bankruptcy was to help the company re-organize by screwing workers, creditors and investors????????????
Isn't that the pro-corporate-anti-union take on this? That companies need to abbrogate labor agreements?
What went wrong? The first bankruptcy didn't screw enough people?

What happened was we gave AA more outside of BK than USAIR got the first round in BK so they had to go back!

USAIR and the IAM started the ball rolling downhill in 2002 and AA/TWU spun it up even faster in 2003.

Of all the unions and workgroups at AA we came out of this the worst. Most of our coworkers, while at severely dimished real compensation levels are still at or near the upper end of compensation, but mechanics lag many of their peers by unprecidented margins. We lag the top by $17/hr plus benifits and workrules, our hourly wage is 34% less than UPS and would need a 50% increase over current levels to catch up.

One of the critical mistakes that we (TWU) made was hiring Eclat back in 2003. They helped the company rip us off big time and made our concessions much bigger than the $315 they claim we gave up. When the union was told they needed to come up with 25% the first reaction from the committee was to make it a straight pay cut, like the Pilots(who got back 9% after the first year). Instead the International pushed the committee to use a combination of pay, workrule and benifits to reach the number. For the union giving up workrules instead of benifits meant that they would preserve dues revenue-instead of losing 25% from each member they only lost 17%, for the company they got to get two bites of the apple through a little manoever they called a "Roll up adjustment".

Here's how the roll up adjustment worked, and what it did was multiply the savings for the company.
Each concession was given a value based upon the current wage at the time, once the wage was slashed the value of the concession was slashed as well requiring more concessions to reach the number.

Lets say you have an Apple that weighs 10 ounces and the company says you need to give us half of that apple, so you figure that in the end you will have 5 ounces and they will have 5 ounces but then they take a three ounce bite out of that apple and say you still need to give us half so they end up in the end getting six and a half ounces instead of five.

Lets look at how this worked with the one week of vacation.
@ $36.99* a week of vacation the company paid us $1479.60 for each week of vacation, thats what we were making before concessions, however the company and Eclat claimed that once we agreed to cut the wage that giving up that week at the new wage of $30.75 was only worth $1230.00, so in order to reach the $315 million "value" we had to come up with more concessions to make up for $249.60 difference. In the TWU Economists explanation this scheme was charectized as "counterintuative", in other words "contrary to common sense". What the company did was change the objective, the goal wasnt for them to reach a specified savings it was for the workers to reach a specified sacrifice. At the end of the day the company saved the full $1479.60 by taking that week away plus the other concessions but they claimed that at the new rate its only costing us $1230.00!!! Of course in reality we are still out $1479.60 and they are up $1479.60 but we only were "credited" with $1230.00. They got to squeeze an additional $249.60 out of each of us beyond the total figure they were saying we were saving them, and that was just one example. The "Roll up Adjustment had the same effect on other workrule and benifit concessions as well, adding at least another $30 million dollars per year in savings for the company that was not reflected in the "value". In other words another $240 million to date that we werent given credit for.

*Thats right, eight years ago we were making $36.99! Your hourly wage today is still less than it was eight years ago. Eight years of inflation is roughly 24%, in other words even if the wage was the same you still lost 24% of your buying power. Make sure you remember that and remind everyone else that as you go about your day at work.

 

[700UW]

Go read section 1113, we were in Bankruptcy, had no choice to negotiate, thats the law, we voted down the first concessions.

You were not in chapter 11 and gave, so who fought and who caved?

And US got over $1.2 billion in concessions per year.

 

[Bob Owens]

Go read section 1113, we were in Bankruptcy, had no choice to negotiate, thats the law, we voted down the first concessions.

You were not in chapter 11 and gave, so who fought and who caved?

And US got over $1.2 billion in concessions per year.

Niether of us fought, we both caved. But we still have our Pension, for now.

In 2002,when all that crap was going on at US I'd been e-mailing the International urging them to get together with all the AFL-CIO unions and block the court with the threat of a General Strike. During my "trial" they cited these E-mails as evidence against me. I felt that we should have told the courts that although they can abrogate current contracts we would not accept terms going foward that were not derived at through the RLA process. If the courts cant force Big Oil, which was the fastest growing expense for the industry, to sell their product at a price that would allow the airlines to remain profitable then they can't force labor.
Instead we did nothing but roll over, Unions even accepted funds from the company to run the vote.
We were all let down by our unions. The membership didnt fail, the leaders failed to lead. None of our leaders took paycuts(maybe yours did), in fact they have continued to get their 3% annual increases all along. Now they earn double what they earned on the floor. It took Wisconsin for them to wake up and realize that Corporate America doesnt just want to take away workers wages and benifits, they want the unions gone. Now that their livelyhoods are at stake they are all for fighting. Very dissapointing, because we have to back them anyway and once that fight is over they will likely fall back into their old bad habits of "Dont resist, live to submit another day".