This update addresses the Change of Control (COC) provision of the US Airways East/LOA 93 contract –and specifically how it compares economically to the proposed MOU approved by the Board of Pilot Representatives.
The COC provision was designed to ensure that US Airways management deals with your union concerning major transactions such as the potential merger with American Airlines. While COC applies to some US Airways East Pilots, we were able to use it to negotiate an MOU with significant economic gains for all US Airways pilots.
Our cost estimates show that the economic values received by all US Airways pilots from the MOU exceed what only some would receive from a successfully executed grievance triggered by a Change of Control.
If the MOU is ratified and the merger is approved, all US Airways pilots will begin receiving the new MOU pay rates as of the date of the POR (estimated to be July 1, 2013) and an increase in pension contributions to 14%. In addition, all US Airways pilots will receive the new MOU pay rates retrospectively back to the date of ratification (February 8). On January 1, 2014, the pay rates increase by 8% and the pension contribution increases to 16%. All US Airways pilots will also share a $40 million lump sum payment. The MOU establishes all pilots as equal for compensation and working conditions at the POR, which will allow for the best outcome for seniority integration.
If the MOU is NOT ratified and the merger moves forward, USAPA would most probably file a grievance for the COC Scope provisions in our contract. If successful with the COC grievance, only some US Airways pilots would accrue snap back wages as of the date of the POR, since the COC provision does not apply to E-190 Pilots or West Pilots.
If this were to happen, and if USAPA is successful in pursuing a COC grievance, then the snap back wages would most likely continue until the new representative of the combined pilot group (probably APA) negotiates a Joint Collective Bargaining Agreement (JCBA). At that time all US Airways pilots would most likely be removed from the snap back wages and provided with the same wages of the APA pilots. Barring a significant change in the industry that would support continuing the COC, those wages would be the wages currently being provided to all US Airways pilots by ratifying the MOU.
According to USAPA’s Merger Counsel, arriving at a seniority integration process with disparity in wage rates may negatively impact the outcome for US Airways pilots.
MOU Timeline
The MOU indicates that the JCBA would be concluded 13-15 months after the POR date:
4 months for a single carrier petition to be filed with the NMB
6-8 months for the NMB to issue a decision,
30 days to negotiate the JCBA
60 days to resolve any disputes in arbitration.
Note:
The COC rates would ONLY apply to EAST Group 2 pilots and above.
EAST E-190 pilots and West Pilots would NOT be included in any COC snap back wages.