MIA LEC letter. Basically saying the majority of the MEC doesn't support the TA!




Fellow Miami pilots,


We start off with a recap of the MEC meeting that took place in Herndon, VA.
As all of you are aware, the result of that meeting was the successor of the previous AIP going out to pilot vote. The company views the MEC as a divided group that does not carry the pilots’ interests. We feel the company will use any language or pressure needed to achieve their goal. With that said, we are not interested in what the company thinks of them, but rather what the pilot group’s direction is. The wishes of the pilot group come first, however these wishes have become clouded with the vocal "vote NO” and “vote YES" propaganda machines running full steam! A majority of the MEC (MIA, DFW and New York) does not support this tentative agreement, believing the pilots also are not likely to support it. But in an effort to achieve the pilots’ true wishes, the MEC allowed this to go to pilot vote.

As pilot representatives, we are charged with providing the pilot group with as many facts and data as possible. This allows for an educated evaluation of the current situation, helping the pilots make the best decision possible when it comes to voting. We believe a majority of the MEC feel the company’s view of the FFD carriers is flawed, leading us to be concerned with a concessionary business plan. During the bankruptcy process, the company and ALPA had to come up with a business plan that was approved by the unsecured creditors, the accountants, attorneys, and ultimately a bankruptcy judge. There was a profitable business plan that was implemented prior to the actual merge of US Airways and American. This business plan is slowly going into effect. Judging from the company’s recently announced earnings estimates of $3.5 billion this business plan has generally been successful thus far. It is hard to understand the justification of the concessions requested by the company. When the company approached the union, we were not provided any financial data supporting the need for a concessionary deal. However, some information the company did approach us with was a threat to "Comair” number two us, if we did not accept this deal.

Historically, concessionary labor agreements in the airline industry, such as bankruptcy agreements and concessionary deals in general, are tied to the direct survival of a company. Employees accepted these deals while their company was hemorrhaging money and so far into the red they had few other options to keep the doors open. A prime example of this is the recent concessionary deal at Pinnacle Airlines, which included a 12/4 pay scale in an effort to survive because of the dire financial situation. Pilots are always interested in doing what is necessary to help their company survive. A prime example was how we here at EGL acted in bankruptcy, pulling together and providing the company some excellent performance numbers, helping in no small part make AAG the profitable company it is today.

There are many sources available via the internet to find information of what is going on in the industry today. Below are excerpts from Republic’s 10K filing with the SEC:

http://www.sec.gov/Archives/edgar/data/1159154/000115915414000020/rjet12311310k.htm

"The regional airline industry is experiencing a shortage of qualified personnel, specifically pilots and maintenance technicians. In addition, as is common with most of our competitors, we have, from time to time, faced considerable turnover of our employees. Our pilots, flight attendants and maintenance technicians sometimes leave to work for larger airlines, which generally offer higher salaries and more extensive benefit programs than regional airlines or low cost carriers are financially able to offer. Should the turnover of employees, particularly pilots and maintenance technicians, sharply increase, the result will be significantly higher training costs than otherwise would be necessary.”

“In early February 2014, the company announced it could not extend CPAs for 27 E140/145 aircraft. This is due to the inability to recruit a sufficient number of qualified pilots to staff the company's 2014 expected level of operations, which includes placing into service an additional 27 E175 and Q400 aircraft. Any further inability to recruit, train, and retain qualified pilots and maintenance technicians may materially impact our results of operations, liquidity, and financial condition, including our ability to meet the contractual operational performance obligations within our fixed-fee agreements.”

“We believe there is a growing scarcity of new entrant pilots who meet the new experience qualifications. Consequently, disrupting service to smaller communities, increasing labor costs, and potential early termination of regional carrier CPAs.”

RAH holdings, which includes several airlines and approximately 4000 pilots, is attempting to reset the bar for pilot pay and standards which has been plagued with poor business plans, incompetent management, and bankruptcy. PSA pilots (approx. 400) and now a member of the AAG group, entered into a concessionary agreement in the belief it would ensure their survival. Unfortunately, their new contract has little to offer pilots joining the industry. Today, many pilots joining the industry have a choice of what airline they would like to fly for. This could harm PSA, especially if other airlines achieve an industry leading pay and contract, and their pilots decide to go elsewhere. Pay is the only guaranteed variable to all these contracts – not flow through opportunities or mainline interviews. We hear that PSA management has recently restricted vacations and US Airways has delayed PSA interviewees in starting class at US Airways. Your MIA Reps feel that the demand for Part 121 pilots will steadily increase as expansion and retirements take effect. This industry is lacking pilots willing to work for low pay, causing a pilot shortage of management’s own making.

The 12/4 pay scale is set up to save the company money on payroll whether or not they hold up their end of the bargain. The inability for the company to excogitate could lead this to be "Penny wise and pound foolish." We have seen similar promised agreements between our pilot group and management that have failed or have been misinterpreted by management for their benefit.

"Those who cannot remember the past are condemned to repeat it."
- George Santayana

In closing, we request that every pilot participate in this vote as a show of solidarity. Regardless of the direction the pilot group takes, we would like to show the company our unity. With that said, we ask that the company to come to our bases to answer the questions of our pilots and explain to us why this is the direction we are taking. We look forward to hearing from all pilots in Miami in an effort to best represent you.

Fraternally,

JF/KW