Originally Posted by
Alan Shore
Why not?
To the extent that profit sharing is based on a percentage of our wages, it becomes a variable component of those wages. So, if Airline A pays $100/hour with a profit sharing plan that can pay up to 20% and Airline B pays $100/hour with no profit sharing plan, one can correctly state that Airline A pays its pilots a variable rate of $100-120/hour and therefore more on average than Airline B (assuming an average profitability > 0).
Then one could just as honestly say that a 20% reduction in profit sharing was the same as a 20% reduction in pay?
Of course the big variable is the sustainability over time of profit sharing in a highly cyclical industry. Some say it shouldn't count as pay since it could end if the profits do, but then accuse anyone who says the economy may not be as robust as some claim as managing expectations.
The one thing for sure is that the company can always afford to pay it. If we trade it away for a raise, and the profits stop, will we be able to hold on to that raise? Imagine a multi billion dollar swing to the negative for a few years. Would we really end up keeping the raises we got by trading profit sharing for them?
I think we have given enough profit sharing away. There is no need to give up more. We are also due raises. No matter what raises we get, we will only get profit sharing if there are profits to share. If we get raises and still have big second tier profits, then by definition the company easily could afford both. Them saying we musy fund our big raised by giving up profit sharing is bad faith IMO because they are basically saying even with those raises they are expecting big profits, particularly second tier profits. Giving up one for another only gives the company upside protection since the downside protection is already built in.