Oly Olson

I can't believe I'm saying this, but the current s--t show just keeps getting worse. Apparently a considerable number of you are narcissists! Well...according to the Council 57 officers:

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Council 57 LEC Update Aug. 14 -- MEC Special Meeting

Historical Perspective: How To Learn From Past Pattern Bargaining Success

Brothers and Sisters of Council 57,

MEC Special Meeting

Tomorrow, the MEC will be meeting in special session in order to review the polling and survey results gathered over the last few weeks. Once those results are analyzed and discussed, the MEC will adjust the priorities for continued negotiations with the company.

Many members have asked whether the details of the random poll or the on-line survey will be made public. This will never happen! As much as everyone would like to know, results of polling data have always been closely held by the MEC. The reason is simple: That data was gathered on behalf of the MEC -- your elected representatives -- so that they can direct future negotiations based on your expectations. Releasing -- or leaking -- that data only serves to give the Company added insight into the mood and expectations of the pilots. Think of a poker game where your opponent can see your cards... It wouldn't be much of a negotiation if the other side knows everything you know!
Historical Perspective

Below you will find a perspective from Captain Jerome Mestman, a long-time member of Council 57 and the LEC Communications Chair from 2012 to 2015, who served during the Contract Extension negotiation in 2015. We believe his comments provide a good review of the negotiating climate during that time, and can provide an important perspective for the environment we find ourselves in today. We appreciate him taking the time.

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How to Learn from Past Pattern Bargaining Success

By Captain Jerome Mestman, Council 57

As we ponder the travails of our current contract situation, I can't help but think back to 2015 and how much today resembles that period, at least in terms of pattern bargaining. We tend to look back at the contractual gains we've made since 2012 with a sense of inevitability, much the same way we look back as if victory in WW2 was inevitable, but nothing was a foregone conclusion at the time. I think the events in airline labor relations in 2015-2016 can provide a great tutorial as to the benefits of effective pattern bargaining.
Pattern bargaining, the game of contractual leap frog, is most effective when all parties are lifting up together, each only requiring little strength to lift a heavy object. Pattern bargaining fails when people expect one party to do the heavy lifting all alone. Effective pattern bargaining means no single union needs to be the "tough guy."

Some may look back at the Contract Extension of 2015 as a foregone conclusion with a great outcome, but it was hardly a sure thing. When put out for membership ratification, the extension passed with a 79 percent approval, but few pilots realize that the Extension TA barely made it out of the MEC by a vote of 11 to 8. Yep, with a two vote swing the pilots would never have a chance to vote on what ended up being arguably the greatest wealth transfer to the pilots in the last 30 years, or longer!
While Contract 2000 and Contract 2012 had larger increases, both of those contracts followed two significant concessionary pay structures: Respectively, the Employee Stock Ownership Plan of the 1990s and the bankruptcies of both legacy United and legacy Continental. The pay increases negotiated in 2015 were a pure gain on the Contract 2012 pay scale.

To illustrate the gains realized in the 2015 Contract Extension: In the Fall of 2015, a 12-year United 737 captain earned $212 per hour. By January 2019, just three and a half years later, that same United captain was earning $282 per hour. By comparison, the Consumer Price Index jumped 7.5 percent during those three years while pilot wages grew by 7.5 percent each year! In other words: While overall prices increased 7.5 percent, pilot wages increased 33.3 percent! (For those arguing today that our wages should be tied to inflation simply because we've have one year of relatively high inflation, I suggest they look at more data than one single bad year!)

How Did We Achieve Such Wage Gains?

In the fall of 2015, Delta pilots were the next pilot group on the negotiating block. The good news for Delta pilots was that its airline was the most profitable airline in the industry. If any labor group were going to extract contractual gains, it would be the labor group working for the most profitable airline, right? The bad news was that the Delta pilots were already the highest paid commercial pilots in the industry; there was no one with whom to play contractual leap frog. Delta management could easily have offered its pilots annual wage increases of 2 percent (actually beating the inflation rate). If the pilots would have voted it down, management could have turned to the National Mediation Board (NMB) and said: We're offering our pilots the highest wages in the industry and they still reject it! We don't know what they want! At that point, the NMB could have turned to the Delta MEC and ask: Well... ?

Under the Railway Labor Act, management has a significant advantage in that labor contracts don't expire outright, they merely become amendable. Workers can't withhold services at the amendable date; the parties must first be released for self-help by the NMB before workers can strike. In 2015, had the United pilots turned down the contract extension (many pilots argued for the gains and glory of a full Section 6 negotiation), it could have resulted in the traditional stalemate with us working through 2019 under a pay scale that topped out in 2017. ($224 per hour for the 737 captain above). The result: Had either the UAL or DAL pilots tried to do the heavy lifting alone, pilot wages could have stagnated for years.

But, that's not what happened!

When the 2015 Contract Extension was approved, many pilots grumbled that the snap-up clause meant the United pilots were riding the coattails of those tough Delta pilots who were actually doing the hard work. The key aspect of the 2015 Extension was that the United pilots raised the wage bar -- substantially -- for the Delta pilots to jump over in the leap frog game. There was little chance Delta was going to offer its pilots the wages it did had United not spiked the punchbowl with the additional 13 percent pay raise in the Extension. Once Delta shot above our wage levels, we simply snapped up to the new Delta pay rates.

In a classic success of pattern bargaining, both labor groups did some moderate lifting where both made significant gains due to the efforts of the other group. The end result: Wages for both the DAL and UAL pilots kept moving; there was no 3-year dead zone of zero wage growth.

2022 vs 2015

I think 2022 is eerily similar to 2015 in that the United and Delta pilots are leading the industry in overall contract value. If we each work independently, trying to do the heavy lifting alone (i.e., push for annual wage increases of 10 percent), we could easily end up in stalled negotiations with zero wage gains for years. Remember, it's called a negotiation and not a "demand" for a reason. Just because pilots want something at the negotiating table doesn't mean the company has to give in - it can easily drag things out for 2 to 3 years. So, when I hear "populist" grandstanding as some voices talk tough as if they can unilaterally force the company to back up a dump truck full of cash for us to gorge on, it gives me pause. The glory of hitting a grand slam in Game 7 of the World Series may seem appealing, but we all know the likelihood of that actually happening. Hitting five doubles in a row in Game 5 may not get the same headlines, but it scores just as many runs and is as effective at achieving the overall goal.

When it comes to the current negotiation, I'm more concerned about winning... however boring it may appear. I'm very, very wary of so-called leaders who promise us glory based on nothing more than empty rhetoric that reflects their own egomania and thirst for power. These narcissists have failed us before; just ask a United pilot who was around during the first two years of the merger, 2010-2012. These populists can bask in their own narcissistic glory on their own dime. You and I would be the ones left holding the bag for their failures.

I'll take boring and successful pattern bargaining over the risk of going super nova any day of the week!

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Again, we thank Captain Mestman for taking the time to write.

If there are any questions or comments, please contact us or file a PDR!

In unity,
Scott, Brian and Jim
(C57 LEC officers)