Jerry,

The Negotiator's Notepad does a good job on the worst case scenarios. Rather than retype what they wrote, let me just re-direct you to that document on your MEC Library page. As you read through those scenarios, I would ask you to compare the result with VS LOA to without VS LOA.

Noncompliance requires a cure. If the Company does not cure then it would result in an expedited grievance.

You raise an interesting point about vendor agreements. Very few people have seen these contracts. Board members do not have access. I was asked to resolve a lawsuit between fee for departure providers who basically were suing each other for "loss of use" due to RJ's getting damaged. The task was figure out the revenue streams less variable costs. The confidentiality of the contracts was the primary reason for the agreement to seek alternative dispute resolution.

If you were to apply a similar agreement to a PWA it would look something like this:

• pilots take a 60% cut in pay. Base rates are less than costs. Therefore, pilots must make bonus money to survive.
• Company keeps metrics on pilots on time performance, completion factor, training, and safety metrics (in no particular order).
• Pilots can potentially earn an 50% bonus for performance (hence a 10% potential raise). Lower levels of bonus for lower performance.
• Poor performance (perhaps due to no fault of the pilot) results in payments less than it costs the pilot to buy a car, buy a uniform and drive to work. Bankruptcy results from poor performance. (In Mesa / Freedom's case they alleged they had been moved to KLGA where they could not make the bonus money ... not their fault ... Court said, tough)

None of that is confidential. Review the lawsuits between Mesa/Freedom, or SkyWest and Delta for details. Bottom line, pilots would hate being vendors. There is a reason that end of the market is imploding (in some cases).

I would like to explore economic incentives for compliance, but probably not in the way you are thinking. Since Delta manages their money, perhaps we could restrict payment for non-conforming operations by third parties (like the vendor agreements). The question is whether any penalty which could be realistically negotiated would be as good a deterrent as the expedited grievance process. In concept, the grievance should be resolved by making the affected pilots completely whole. The Company has the uncertainty of the outcome (which they hate) and the risk of ugly labor relations making the press.

Another aspect to consider; Labor Protective Provisions evolve at a glacial pace (maybe slower than glaciers if measured by Al Gore). American's Scope Section remained stuck, got struck down by the Courts and effectively mirrors our ~ 2010 agreement, after 15 years. United's also mirrors ours. In the meantime, the Delta MEC has remained in nearly constant scope negotiations which have substantially increased the amount of flying being done by Delta mainline and this VS JV is another World first. Compared to the rest of the industry, we've been in warp drive.

Just my opinion ... .