Also, for those not aware, TC has just upgraded and gone to HKG. Although the FDA stuff in the TA would have benefited him, he chose to be 1 of 2 dissenting votes. Good leadership TC.
Ladies and Gentlemen of Seniority Block 5,
The FDX MEC Policy Manual describes an MEC communications protocol to which each member of the MEC voluntarily submits. Representatives are urged to submit written or website communications to the MEC Communications Department, after which the appropriate MEC staff, committees, and officers review the communications for factual content. The goal of this process is to ensure consistent and accurate communications to the membership. However, this protocol is not intended to unduly limit the elected representatives’ constitutional rights to communicate.
I submitted the following Block 5 Update according to the protocol, and I have incorporated many of the recommended changes. I am appreciative of the time and effort which was dedicated to improving the final draft. However, the MEC Vice Chairman has refused to publish this via our normal venues of communication, i.e., through e-mail and on the FDX ALPA website. While I do not expect him to share my opinions, I do not believe there is anything in this update which is factually incorrect. Having reached an impasse, and being entitled to communicate freely with you, I must regretfully resort to communicating to you without his blessing. I have tried to work within the protocol, but I will not be silenced, nor will I compromise my message to you.
This update will not be published on the FDX ALPA website—pilots of Block 5 will receive it at the e-mail address they have on file with ALPA, and pilots of Local Council 22 (Blocks 2, 5, and 7) will have access to it through the crewroom.alpa.org website in “My Mail” (http://fdx.alpa.org > Quick Links > My ALPA > Mail).
Ladies and Gentlemen of Seniority Block 5,
On February 9, 2011, I cast my vote on behalf of you and all pilots at FedEx Express on the very important question of whether to endorse the tentative agreement and begin the process of membership ratification, or to reject the TA and continue negotiating our collective bargaining agreement according to the procedures proscribed by Section 6 of the Railway Labor Act. I did not take the responsibility lightly, and I believe you deserve an explanation of why I cast a dissenting vote. I submit this narrative as an explanation of my perspective on the events leading to this vote, and how I came to cast that vote.
I apologize for the length of this update, as it is very long. I don’t want this to be the first in a volley of point/counterpoint messages. As the one and only statement on the subject, I want to make sure I have fully explained each point. I’ll apologize in advance if I fail in that goal, but I will not be publishing any further explanations, so as to avoid even the appearance of campaigning against the TA. I also apologize for the time which has transpired since the vote was cast, the time you’ve had to wait to hear my explanation. My schedule has been somewhat dominated by upgrade training, and I’ve been trying to not embarrass myself in that endeavor. In fact, I could have focused on training and assigned my proxy to another member of the MEC and avoided this vote, but I considered it far more important to ensure that you were adequately represented at the MEC table. I thank you for your indulgence and your patience.
Collective Bargaining under the Railway Labor Act
No sooner than the ink had dried on our current CBA, our union began gathering data and ideas in order to formulate goals and strategies for our next CBA. Your MEC held strategic planning retreats, sponsored polls conducted by the Wilson Center, hosted Web-based polls and surveys, solicited direct input from pilots to their block representatives, compiled input from committee chairmen, and added their own list of priorities for improvements. We examined those areas which give us the most grief through contract enforcement, discipline, and grievances. Based on the data which was gathered and our assessment of the political and economic environment, we established reasonable, achievable goals. We sought to achieve a limited number of improvements so we could complete the task in an abbreviated time frame. Nobody wanted to engage in a lengthy, protracted cycle of negotiations. Our Negotiating Committee did an outstanding job of condensing that data into realistic, achievable goals and developing a plan to achieve those goals. We communicated that plan in a document we called “Section 6 Openers,” we sent you a copy of that document along with a new ALPA lanyard, we asked you to wear the lanyard to support the Negotiating Committee, and we committed to strive towards those reasonable, achievable goals.
Since negotiations began in August of last year, progress has been made at a reasonably brisk pace. The Company chose to open some sections of the CBA which we had elected to not open, but four sections were not opened at all. To date, four of the sections we opened have been TA’d, and four of the sections the Company opened have been TA’d, bringing the total of TA’d sections to twelve. While there are important improvements (and in some cases, losses) in these sections, the areas covered in those sections do not typically affect the day-to-day life of the average line pilot.
Congress, the FAA, and Flight and Duty Time Rules
In the background of these negotiations, the FAA has been working on the formulation of new rules to address pilot flight time, rest, and fatigue. Following the crash of Colgan Air Flight 3407 in Buffalo, N.Y., on February 12, 2009, the issue of pilot fatigue gained the widespread attention of the public. Driven by the concerned families of the victims of that crash, Congress got involved and mandated changes. In July of 2009, the FAA convened an Aviation Rulemaking Committee (ARC) to recommend a science-based approach to fatigue management. We were fortunate to have one of our pilots, Captain Bill Soer, on that ARC. FedEx management also had a member on the ARC. Between the two, we have a solid grasp of the range of rules proposed by the ARC to the FAA on September 1, 2009.
In November of 2009, the FAA formally withdrew the rules they had proposed in 1995 to address flight time and rest limits. A fear exists that this current NPRM process will become drawn-out like the previous one. But a significant difference between the 1995 NPRM and the current NPRM is that the timeline in this case is mandated by Congress. The 1995 NPRM received thousands of comments from the aviation industry, and, although there was much opposition, there was no consensus on what the rules should be. The result was inaction. Today, we have a consensus recommendation from labor, and a more mature body of fatigue science to support that recommendation. Based on the soundness of the recommendations and the attention of the public and lawmakers, I believe it is very likely that we will see new rules on the schedule mandated by federal law.
Nevertheless, a suggestion was made to the MEC that we “pause” negotiations of our CBA until the results of the FAA’s rulemaking process are published. The MEC rejected that strategy, and directed the Negotiating Committee to continue along the path we had laid out in our strategy to negotiate a CBA on an expedited timeline.
Foreign Duty Assignment Letter of Agreement
And yet, our “timeline” for negotiating was substantially altered last fall when the Company wanted to devote a considerable amount of time and energy to negotiating a Foreign Duty Assignment Letter of Agreement. The MEC approved the change in direction, and we sent a team to study working and living conditions in Cologne and Frankfurt, Germany. Negotiations focused on modifying and improving the benefits provided in the “original” FDA LOA, and concluded with the creation of a “new” FDA LOA. (This is the FDA LOA contained in the January 27 tentative agreement.) The Company was eager to submit this FDA LOA to the membership for ratification. Your MEC, sensitive to the ratification environment, felt that submitting that LOA to the membership for ratification would have been a waste of resources (Road Shows and BallotPoint cost dues money) and that such a vote would not have been a unifying event for this pilot group. The Negotiating Committee suggested that the Company add something to the FDA LOA which would have mass appeal, such as an across-the-board pay raise. The Company rejected that idea, saying there could be no pay raise outside of a full CBA.
Exploring a New Strategy
Given that ultimatum, and a fear that the flight and duty time rules would make negotiating impossible, the MEC officers directed the Negotiating Committee to explore the possibility of “packaging” the FDA LOA as an “interim” contract, or a contract “extension” which could include a pay raise to make it more palatable to the membership. As it turned out, while the Company was unwilling to include a pay raise in an LOA, they were willing to include a pay raise in a CBA, which will end RLA Section 6 negotiations. Such was the genesis of the TA in your hands now. In addition to the FDA LOA, the previously TA’d sections of the CBA, a modest pay increase, a small lump sum, several LOAs and MOUs, and two administrative grievance settlements are included in the package.
That is my view of how we got to the point where the MEC was asked to endorse or reject this TA. In answering that question, I gave consideration to the final CBA we seek to achieve, how this TA might affect the ultimate value of that CBA and the time it will take us to achieve it, and whether this TA is in and of itself worth the risk of extending our timeline or diminishing the quality and value of the final product.
Before I explain my view of the strategy and the future, allow me to give you my assessment of the TA itself. First, there are twelve sections of the CBA upon which ALPA and the Company had already reached tentative agreement. Four were sections we chose to open, four were sections the company chose to open, and four were sections we both agreed to not open. (Sections 10 [Management Pilots], 16 [Worker’s Compensation], 17 [Prisoner of War], and 30 [ALPA-PAC] were not opened, and are not included in the “printed” TA.) By plan, these sections were chosen first because we didn’t anticipate they would involve difficult negotiations or any economic impact. While there are substantial and meaningful improvements, there aren’t many issues involved which, in my opinion, affect the day-to-day lives of most pilots. With regards to requiring a pilot to provide “a written statement from the pilot’s physician,” replacing the vague wording “in conjunction with” with the specific wording “within 24 hours” is a win for us. Removing the $50 penalty for not using the Company-issued credit card to pay for an annual or semiannual FAA medical examination is a win for us. (Waiting three years to have the amount increased another $25 is a hollow win for us.) The creation of an ALPA Safety and Data Collection Bank for flight pay loss associated with critically important safety programs is a big win for us. Lengthening the duration of the probation period for newly hired pilots is a loss for us, with no offset.
Sections 3 (Compensation), 5 (Traveling Expenses), and 31 (Effect on Prior Agreements, Effective Date and Duration) are included to add dollars and make this a tentative agreement, but they were not part of the original twelve sections. If this TA is ratified, these three sections will be reopened and negotiated in any future RLA negotiations, but the 12 TA’d sections will remain closed, unless unforeseen circumstances dictate otherwise.
Iraq and Afghanistan Flying LOA
Now let me discuss the “other” LOAs and MOUs which are bundled into this deal. Over two years ago, before the Company invoked §4.A.2.b. of the CBA, we had finished work on the Iraq and Afghanistan Flying LOA. This LOA closely resembles the Civil Reserve Air Fleet (CRAF) LOA currently in effect, as the flying is very similar in type and risk. The problem we had encountered was that the CRAF LOA would not be triggered unless the CRAF was activated. So, while pilots were flying into an “increased threat area,” an airport within a country either in or geographically contiguous to a country against which the United States is actively engaged in a military confrontation, they did not qualify for the benefits or protections provided by the CRAF LOA. While I am not happy about the strained method of defining the areas which qualify, and am less happy about the mechanism for removing or adding countries to the list of countries covered, I support the overall concept and the Iraq and Afghanistan Flying LOA as a whole.
ICAO “Over/Under 60” LOA
At that same time, we had also completed work on an LOA to address the problems encountered by our over-age-60 pilots, both Captains and First Officers, who may not both occupy the cockpit when flying internationally. The only mechanism the Company has to deal with scheduling conflicts after such pilots are awarded the same trip is substitution. Many of our pilots try to avoid being scheduled together, but sometimes it is unavoidable. This LOA provides a much more comprehensive solution to the problem, and, in my opinion, represents a big improvement.
Safety Programs: ASAP, FOQA, and Data Collection
Years of work have gone into developing industry-leading safety programs, like the Aviation Safety Action Program (ASAP) and the Flight Operational Quality Assurance (FOQA) Program. We have fought long and hard to protect the pilots from discipline when they submit ASAP reports, and to ensure that FOQA data is de-identified by ALPA Gatekeepers before it is entered into that program. Additionally, a Collection of Human Performance/Alertness Data Program was created to form the basis of a Fatigue Risk Management System (FRMS), which will be important for dealing with the anticipated results of the Flight and Duty Time NPRM, and with ultra long-range flying anticipated in our future. All three of these programs are huge wins for the pilots.
Administrative Grievance 10-02 (Pilot In Command on Augmented Crews): Settlement Agreement
Wrapped together with the TA’d CBA sections, the MOUs, and the LOAs are two grievance settlements. The first, Administrative Grievance 10-02, deals with the designation of PIC when two captains happen to be crewed together, and for some reason, the Captain captain with the highest system seniority is not the pilot in command. Although the affected pilots suffered no economic harm, they will receive an economic reward in the form of hours credited to their compensatory makeup banks, which allows them to pick a trip and receive compensation at 150 percent of the normal pay rate. The method agreed to for determining PIC is essentially the same as that which is published in the latest version of our Flight Operations Manual (FOM).
Administrative Grievances 09-02 and 09-04 (Invocation and Implementation of §4.A.2.b.): Settlement Agreement
The second grievance settlement in the package is for Administrative Grievances 09-02 and 09-04, the Invocation and Implementation of CBA Section 4.A.2.b. I’m sure you’ll recall that the arbitrator in these grievances rendered a decision on most aspects of these grievances in May 2010. The arbitrator also maintained jurisdiction over a limited aspect of the grievance, and encouraged the parties to work together to achieve a solution. At that time, our attorneys told the MEC, and the MEC told you, that we considered the arbitrator’s decision to be a “split decision.” We told you we would be evaluating the months we spent in §4.A.2.b. with the objective of determining an appropriate “buy-up value” which would affect the pilots whose BLGs had been most adversely affected by the systemwide spreads in BLGs. We committed to examine those months which had been presented to the arbitrator (who we felt had used incorrect assumptions in evaluating those months), and those months which had not been presented to the arbitrator, as we had remained in §4.A.2.b. even after our case had been fully presented to the arbitrator.
Although the MEC told you we would seek an economic remedy for those pilots who were most harmed by the greatest disparities between the highest and the lowest bid line guarantees, we never proposed such a remedy to the company. This settlement seeks no such remedy. This settlement agreement puts no restriction on entry into §4.A.2.b. This settlement agreement establishes no minimum on the value of a day of reserve, and no minimum on the value of a day of instructing. It only addresses one of the aspects of the grievance left unsettled by the arbitrator, that is the spread between high and low BLGs. It offers no remedy to the pilots who were most harmed by the implementation of §4.A.2.b. To be fair, I must point out that some of those questions fall outside of the narrow scope of the Administrative Grievance and the specific areas left by the arbitrator for the parties to discuss. Those aspects will have to be negotiated through the normal RLA Section 6 process when we get to Sections 4 (Minimum Guarantees and Other Pay Provisions) and 24 (Furlough and Recall) of our CBA. However, this settlement agreement closes the door on ever receiving any economic compensation as remedy for the unfair spreads between bid line guarantees when we languished under §4.A.2.b.
This settlement agreement resembles the Administrative Grievance 09-03 (PSIT Expulsion) settlement agreement in some respects—it employs the systemwide average metric concept, and a buy-up value provision. The subtle differences are important to note. First, while there is an upper limit of sorts on the high BLG—no more than 13 CH (17 CH in a five-week bid period) greater than the lowest paid regular line—there is no lower limit on the low BLGs for the secondary lines. Similarly, there is an upper limit on 95 percent of the lines—no more than 16 CH (20CH in a five-week bid period) greater than the lowest paid regular line, yet there is no lower limit for the secondary lines. Also, for 5 percent of the lines, there is no upper limit whatsoever on BLG.
Beginning the first day of the January 2012 bid period, secondary lines that are not constructed solely with reserve days will also be included in the calculation of the systemwide average metric. While including secondary lines in the calculation could conceivably bring the SAM up and hasten exit from §4.A.2.b., it could also drag the SAM down and have the opposite effect. The values of secondary lines could be artificially depressed by increasing the number of secondary lines and reducing the number of reserve lines. Secondary lines constructed solely with reserve days are not included, but nothing would prevent the Company from building secondary lines with one trip and 14 reserve days. Building secondary lines with one out-and-back and the remainder of reserve days would drag the SAM down, further delaying exit from §4.A.2.b.
To make matters worse, crew positions with fewer than 100 active pilots (Hong Kong and Los Angeles fit that description today, maybe Cologne tomorrow?) are excluded from the line construction limitations forever. And to add unspeakable insult to heinous injury, the company felt it necessary to craft language, excluding the B-777 fleet from the calculations, which contemplates the possibility of invoking §4.A.2.b. during the upcoming year!
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In addition to the TA’d sections, the LOAs and MOUs, and the Grievance Settlement Agreements, a few sweeteners have been added in Sections 3 (Compensation) and 5 (Traveling Expenses). First, there is a 3 percent increase to the hourly pay rates in the first year, and another 3 percent in the second year. I choose to use the word “increase” instead of “raise” for two reasons. First, as the number is roughly equivalent to average Consumer Price Index inflation, it only represents an ability to purchase the same goods and services at their inflated prices, not an ability to purchase more goods and services. A true raise would allow you to purchase more goods and services, not just the same goods and services at inflated prices. Second, as the date of the pay increase is moved “to the right” from October to March, the slope of the graph of our pay rates remains the same, but the line itself shifts to the right, leaving a gap in income that extends to eternity. The gap created by delaying an increase in pay rates from last October (when our current CBA became amendable, and when we would have received a pay increase based on the previous schedule) until February 2011 is ostensibly filled by the 1 percent lump-sum payment. I say ostensibly as the lump sum is calculated as 1 percent of calendar year 2010 earnings. Some of you may recall having suffered from deflated income during half of that calendar year under the implementation of §4.A.2.b. Many of you have suffered, and suffer still today from being excessed from higher-paying crew positions. I personally find it insulting that a lump-sum payment would be based on that income. But that only represents the income gap created this year. There is nothing to offset the gap which will be created next year and every thereafter as a result of shifting the date of the pay rate increases to the right.
I almost forgot about the 20¢ bump in hourly per diem. I almost forgot because it’s still well south of what our brothers in brown receive, and it doesn’t even start until July. To say the least, I’m underwhelmed. While I won’t turn my nose up at $4.80 per day, I don’t see it going very far in Narita or Paris, and I can’t see it being a determining factor in choosing to support this TA.
The Foreign Duty Assignment Letter of Agreement (FDA LOA)
Finally, the elephant in the room: the Foreign Duty Assignment Letter of Agreement. Let me begin by saying I believe having pilots geographically based in locations where we have or expect to grow large segments of our international business is a good thing, for the Company and for the pilots. We want to be in the cockpits when our freight is being flown, even between international locations which are not specifically protected by any scope language. I am in favor of growing our business, and keeping it reliable and flexible. I want to be able to respond to rapidly changing markets and weather conditions. That which makes our Company more profitable makes our futures more secure, and makes our compensation more important. That being said, Foreign Duty Assignments should not impose hardship on our pilots—we should be compensated appropriately.
This FDA LOA is a step in the right direction as far as improving the benefits to the pilots. Increases in monthly rental stipends, the addition of an education benefit, and protection against currency exchange fluctuations are big improvements for the pilots in those FDAs, and that makes them improvements for us all. The FDA re-mail program might not sound like much, but to the pilots in Hong Kong, it’s a big improvement—and that makes it a big improvement for us all. Removing the Company’s ability to inversely assign special temporary vacancy awards is an improvement for us all, finally codifying what the system chief pilot had promised us would be the policy.
The Deadhead by Surface Transportation section of the FDA LOA will no doubt be controversial. Having flown from Paris to Frankfurt and having taken the train from Paris to Frankfurt, I would, given the option, take the train. Given the limits on the city pairs where train transportation can be scheduled, and given that the deadhead on a train creates a deviation bank, I believe the section represents an improvement for the pilots. The limits on ground transportation between Hong Kong and Guangzhou (and back) and the deviation bank value of those deadheads represent big improvements for the pilots.
A new feature of this FDA LOA is a mechanism for a pilot to leave the FDA without a bid award to another crew position. Under this arrangement, a pilot can elect to leave the FDA, and the Company must provide ITU training or a base transfer date. There are only three catches. First, there has to be a junior pilot activated and currently holding the non-FDA crew position that pilot holds. If the pilot in question happens to be on the bottom of the seniority list, he’s out of luck. Second, the process can take up to 180 days to play out, and it can only be invoked after the pilot has been at the FDA for three years, turning the two-year commitment into a three-and-a-half–year assignment. Finally, from the time the pilot gives notice, six months prior to the requested exit date, until the pilot begins training or is transferred, up to 180 days after the requested exit date—that’s a year total for those of you who are counting—the pilot is restricted from participating in vacancy postings. I’m not sure if the risk is worth the reward.
Finally, I want to draw your attention to Paragraph L: Maximum Duration of Assignment to an FDA in a European Union Country and Subsequent Bidding Limitations. This paragraph replaces a short, vague paragraph in the original FDA LOA which consisted of a single sentence: “Should an FDA have a maximum stay time limitation established by the host governmental authority, the Company shall advise the Association as to how it intends to transition pilots to this restriction without abrogating seniority as articulated in the CBA.” With the new language in this LOA, we now know that such a restriction on residency does exist, and we now know how the Company intends to deal with it. Under U.S. International Social Security Agreements, the United States and “partner” countries establish “totalization agreements.” These agreements eliminate dual social security taxation where a worker from one country (the United S) works in another country (Germany) and is required to pay social security taxes to both countries on the same earnings. The “detached-worker rule” allows an employer (FedEx Express) to send an employee (the pilot) abroad (to Germany) on temporary assignment and pay only U.S. social security taxes, but it only applies to employees whose assignments are expected to last five years or less. If FedEx Express were to send a pilot to Germany for more than five years, the Company and the pilot would only have to pay German social security taxes. (In no case would they have to pay both U.S. and German social security taxes.)
This provision must be considered in conjunction with tax equalization, since both are components of the FDA LOA, but not in Section 6 of the CBA. Under tax equalization, the cost of paying German social security taxes would be transparent to the pilot—any increase in cost would be offset by “plus ups” to keep his tax burden at the same level as it would have been were he living in the United States. (Remember, that’s the whole idea behind tax equalization.) However, the cost would not be transparent to the Company. Because of tax equalization, the Company would bear any increase in cost to the employer, and the Company would bear any increase in cost to the employee. Then the Company would bear the cost of the tax equalization “plus ups.” Limiting the length of the assignment ensures that the pilot and the Company pay only U.S. social security taxes. This “maximum duration” provision, therefore, eliminates the Company’s exposure to these increased costs.
On the whole, I believe the FDA LOA is an improvement for the pilots, and I believe it is a benefit to the Company. Apart from the safety programs included in this TA, I believe the FDA LOA represents the best part of the TA.
Clearly, this tentative agreement falls well short of achieving the goals we set out to meet. As an interim measure, it needs to be evaluated on the basis of how it will affect our efforts to reach the ultimate goal of a CBA which addresses the issues we set out in the beginning to address.
Ratifying this TA would conclude the Section 6 process of the Railway Labor Act. We would have a complete collective bargaining agreement with an effective date and an amendable date. At some point in the future, we would open a fresh “set” of negotiations with the Company to amend the CBA to address the issues we have now. At that point, we would try again to achieve the goals we have now.
Rejecting this TA would leave our status under the RLA unchanged. We would continue negotiating the issues we identified through our planning processes, and we would strive towards the same goals. The question to ask is which strategy is best to bring us to the ultimate goal? Will the end product be affected in any positive or negative way? Will it take more time to get there, or less?
If concluding negotiations now would result in a diminished ability to negotiate in the future, it stands to reason that we will not be able to achieve as much through negotiations to achieve our goals. It would be unrealistic to assume that we’ll get everything we want, but it would be silly to not try to get as much as possible. We all want the best deal possible, and we don’t to do anything which would harm our chances of getting as much as possible.
Even if the quality of the final product were to be unaffected, prolonging the process is also undesirable. One of our major goals in this undertaking has been to conclude negotiations in a reasonable time frame, recognizing that the two-and-a-half years of negotiations the last time was too long. Delayed benefits are no benefits at all. While we can look at the issues of overall quality of the final product and the time required to achieve it as separate issues, it is more likely they are not separate, but are inextricably intertwined.
So, given the background of the tentative agreement itself, I needed to answer several questions. How would accepting this TA affect our ability to achieve our original goal, a collective bargaining agreement which addresses our most important concerns and which appropriately rewards us for our contribution to the success of our company? Would this “interim CBA” strategy risk our ultimate goal of a complete CBA that addresses the broad-spectrum issues described in our openers? Would it prolong the process, or will it diminish the quality of the final product, or both? If the “interim CBA” strategy does place that goal at risk, does it provide sufficient reward to offset that risk?
The Timeline and the NMB
In order to fully appreciate the importance of the timeline, we need to understand a few important points about the National Mediation Board, or NMB. If we encounter difficulties negotiating with the Company, we will go to the NMB to seek relief. If we want the assistance of a mediator, we go the NMB. If we reach a point where we can’t seem to resolve our differences and we want to be released to self-help, we will go to the NMB. So, who is the NMB?
The NMB consists of a chairman and two other members, all appointed by the president of the United States. The RLA requires that one of the three appointees is from a political party other than that of the sitting president. Currently, the chairman and one member are from the president’s party, and one member is from the other party. Mr. Harry Hoglander is serving his third (nonconsecutive) term as chairman of the NMB. Mr. Hoglander was a pilot and lieutenant colonel in the U.S. Air Force, a captain for TWA, a TWA MEC chairman, and an ALPA executive vice . He was named Aviation Labor representative to the United States Bilateral Negotiating Team by Secretary of State James Baker. He also served as legislative specialist in the office of Congressman John Tierney of Massachusetts with responsibilities in transportation issues including aviation, rail and maritime, labor, defense and veterans affairs.
Ms. Linda Puchala is an appointee of the current president. She has worked as a mediator, a senior mediator, and, for a brief time, as the chairman of the NMB. Her 40 years of experience in labor relations includes being the international president of the Association of Flight Attendants–CWA, AFL-CIO. Ms. Puchala’s current term as NMB member runs through June 30, 2012.
The third member of the NMB is Ms. Elizabeth Dougherty. An appointee of President George W. Bush, she has served on the NMB since December 2006, and has served twice as the chairman. She began her career practicing labor and employment law, served as chief counsel for the Senate Subcommittee on Employment, Safety, and Training, and then served as special assistant to the president for Domestic Policy at the White House, where she covered labor and transportation issues.
A key factor in planning our strategy for this round of collective bargaining has been to conclude the process in a labor-friendly environment. There is no guarantee that the next presidential election will result in the election of a labor-friendly president and the appointment of a labor-friendly NMB. With such uncertainty, it would be wise for us to complete the bargaining process within the terms of this particular NMB. It would be foolish to prolong the process and take the chance that we reach the “endgame” under a new administration and a less-friendly NMB.
I considered the vote I cast on your behalf to be a very important part of our process. I have a fiduciary responsibility to consider whether it is best to commit our financial resources in support of the TA and the strategy it represents. You don’t pay dues money, and you didn’t elect me, so I can rubber stamp every proposal brought to the MEC. Tens of thousands of dollars will be spent to saturate the membership with information and to conduct a vote. There are costs of printing, costs of renting venues for Road Shows and Q&A sessions, costs of video productions, and webcasting. There are costs for “free lunches,” and costs for MEC officers and the Negotiating Committee to travel around the country and abroad. In addition to the significant cost, the lengthy process stops the process of negotiating until the vote is concluded. Simply passing a difficult question along to the membership to vote would have been an abdication of my responsibility to you, and a violation of my commitment to provide prudent stewardship of your dues money.
In deliberating these issues and questions, the question was posed, “If we ratify this TA, will we be better or worse off one year from now?” The only way to answer that question is to analyze all the facts we know and to apply our judgment.
Let me start by saying, I do not believe the FAA’s proposed rules for flight and duty Times times constitute a roadblock to negotiations. I do believe there will be challenges, but I am confident they can be met and overcome. One year from now, we will be seven months beyond the time mandated by Congress that the rules be issued. They will include a phase-in period of two years to allow us to program the rules into our contract. The two-year period is not a time to stop negotiating—it is a time to adjust to the new rules.
Many of you are aware that the pilots of Pinnacle Airlines have been struggling with their management for nearly seven years to negotiate their CBA. After the purchase of Mesaba and Colgan, they undertook an effort to negotiate a joint collective bargaining agreement. After only 102 days, they achieved just that. How could that be possible? With a management who has managed to delay seven years, how could the NPRM not have been a roadblock to negotiating a JCBA? Won’t the changes to the flight and duty times have a more dramatic effect on their work rules than ours? They met the challenge in an innovative way, and we should all take note. They included in their JCBA an agreement to reopen sections which are affected by any changes to flight and duty time rules. Clearly, the FAA rulemaking process is not a roadblock to RLA Section 6 negotiations.
Given that view and the long list of items we have left to negotiate, I believe it is realistic to believe we can spend the upcoming 12 months negotiating the open sections of our CBA, find out what the Company has in mind for Retirement and Insurance (they haven’t presented their proposals yet), and clear the table of most of the issues we want to negotiate. If the Company is not then willing to consummate a deal, we will be in an optimal position to petition the National Mediation Board for assistance. We are very fortunate now to have an NMB composed of labor-friendly appointees, but there is no guarantee that the board will have the same composition if the next presidential election results in a change in the White House. If we delay too long, we risk not being able to take advantage of a labor-friendly NMB.
The alternative course of action would be to approve this TA, have “meaningful conversations” instead of Section 6 negotiations, elect to forgo the second year of this CBA, and begin Section 6 negotiations again on February 1, 2012. Twelve months from now, if we choose this path, we will not even have reached the amendable date of the CBA. If we seek assistance then from the NMB, I cannot imagine how they will contain their laughter.
If we choose instead to take the second pay rate increase and extend the CBA for the second year, we will almost guarantee we’ll never see this NMB. Given the history we have with negotiating, I would then anticipate years and years of negotiating to get to the “real CBA.” Given that prospect, I don’t know of any member on the MEC who views this as anything other than a one-year deal. And yet, we haven’t considered who will make that decision, or how.
In all of this analysis, one has to wonder what motivates the Company to make this deal. It wasn’t their idea in the first place, and it wasn’t their idea to rush the deal to a conclusion right now, but they are obviously motivated enough to wrap it in money—tens of millions of dollars of money. Why?
You probably have some ideas, and I have some of my own. Let’s talk about the elephant in the room again. I’ve heard it said many times that if the Company wants to establish an FDA in Cologne, they can use Section 6 of the CBA. In fact, I’ve said it myself. However, I don’t believe that statement is 100 percent accurate. What is accurate is that the Company has Section 6 of the CBA at its disposal. They can use anything in Section 6 any time and any where they desire. But the question is—can they establish an FDA in Cologne using Section 6? I’m inclined to believe they cannot, and for at least three reasons. First, Section 6 of the CBA does not require a pilot to sign a personal agreement promising to be bound by the laws of the United States, and not the laws of Germany, or to waive his right to seek jurisdiction in a German court. Second, Section 6 of the CBA does not require a pilot to participate in tax equalization. Finally, and I believe most importantly, Section 6 of the CBA does not have a method to force a pilot to leave Cologne before five years of residency.
And while I believe the FDA LOA represents considerable value to the Company, I cannot know for certain what motivates them to agree to this deal. It may be the FDA LOA, or it may be the ability to claim “labor peace,” or it may be a plan to purchase new airplanes. It may be a plan to change the cycle of negotiations so we can see what UPS does with their pay rates so we can beat them by a nickel. Whatever the motivation, this I do know: Once we ratify this TA, that motivation will no longer be working to our advantage. Whatever it is that’s motivating the Company to slide money across the table to us today will certainly be gone as soon as this TA is ratified by membership vote. It follows logically, then, that whatever has been driving the Company to negotiate in earnest now will not be there to motivate the Company after TA ratification to negotiate in earnest to achieve a final, “full” CBA.
Since we are determined to achieve the “contract” we told you we would fight for, and we are determined to do that in an expedited time frame, removing a motivation for the Company to negotiate is a big problem. Any strategy which delays the ultimate achievement of that goal is counterproductive to our success.
We all must admit that none of us has a crystal ball and none of us knows what the future holds. Even the experts cannot guarantee with any degree of certainty what one course of action will produce compared to another. As mentioned before, we all favor the course of action which allows us to achieve our ultimate goal of a CBA which satisfies most of our needs, and in a relatively short time. In this case, I strongly believe ratifying this TA will have the effect of prolonging the wait for us to get to the final deal. At present, we have been in RLA Section 6 negotiations for less than six months. If this TA is ratified, we will have no negotiations for at least a year. At that point, we will be starting a fresh “set” of Section 6 Negotiations. If the year of “discussions” described by the Commitment Letter bear little or no fruit, we will have lost a year of negotiating, and we will have little chance of persuading the NMB that we need help negotiating. If we do not ratify this TA, and we have not achieved a TA on a full CBA by the same time a year from now, we will have a convincing case to make before the NMB.
Because the process would be prolonged by this TA, and because the Company would no longer be motivated by whatever is motivating them now, I believe the quality of the final product, the “real” CBA, would be considerably diminished. What will motivate the Company to fix the accepted fare problem? Why will they be interested in enhancing our deviation banks or implementing real-time trip trades? Why will they agree to a minimum value of a reserve day, or a day of instructing? Why should they increase new hire pay or agree to a solution to the §4.A.2.b. problem? We should never expect to get everything on our wish list, but I believe if we employ the strategy of this TA, we should expect to get less in the long run.
I also reject the notion that meaningful negotiations cannot occur prior to the FAA’s announcement of new flight and duty time rules. Furthermore, I believe delaying our negotiations until those rules are published will vastly increase the risk that the Company will want to make us pay for any improvements in work rules which may come as a result of the changed FARs.
A complete product will address all of the Sections of the CBA which we have opened, and although we are not so naive to think every pilot’s pet issue will be solved, we will have given our best effort to solve as many of those issues as possible. We will address accepted fares and deviation banks. We’ll work to get real-time trip trading. We’ll strive to take care of pilots who were under age 53 when the previous CBA was ratified. There will be a real fix for §4.A.2.b. There will be a real pay raise. Not only does this TA fail to accomplish those goals, I feel it will delay the achievement of those goals.
My decision then, while weighty, was very simple. In my opinion, there is not enough value to the package before us to risk the attainment of the ultimate goal. The risk of delaying the “real” CBA and diminishing its value is not outweighed, in my opinion, by the reward it represents. For that reason, I recommended that we reject the TA, and to direct the Negotiating Committee to immediately engage in negotiations to implement the safety programs—ASAP, FOQA, and Data Collection—as standalone MOUs and LOA, and to then get back to the work of negotiating our CBA.
As you know, that wasn’t the view of the majority of the Master Executive Council. The MEC did not vote to recommend the TA or to recommend how a member should vote, but the MEC did vote to endorse the TA and to begin the process of member ratification. The vote, then, is in your hands.
I did not undertake this lengthy writing project as a way to sway your vote one way or another. It is intended, rather, to be a thorough explanation of the information and thought processes I used to cast my vote against endorsing the TA. I’ve tried to make it thorough in an effort to leave no questions unanswered, as I do not intend to engage in a process of response and counter response. The vote to endorse is history, and it would serve no purpose to debate it further. The decision you as a member must now make is whether to ratify the TA. I support the ratification process, and I encourage you to do everything you can to educate yourself and cast an informed vote.
I appreciate you taking the considerable time to read this letter, and am confident you will take your responsibility to vote seriously. As always, I stand ready to answer your questions or receive your comments, suggestions, and critiques. Please do not hesitate to contact me at any time via e-mail, telephone, or in person.
Wow. Thanks for all the insight. We miss your insight daily here on the boards, but is it good to know you have not lost any brain cells in your absence. I think any wavering I might have still had is gone. Thanks.