American, progress w APA, deal by Nov 1
 

American Airlines sees ‘good progress’ in talks with pilots, deal by Nov. 1 | LeveragedLoan.com

American sees 'good progress' in talks with pilots, deal by Nov. 1

American Airlines sees ‘good progress’ in talks with pilots, deal by Nov. 1 | LeveragedLoan.com

Don't think this is going to happen. We are too far away on scope and several other key issues, such as length of contract, actual credit for our A fund going away, not talking about an equity stake in the company in lieu of the hard money. If this gets to the BOD, I don't see it getting sent to the membership for ratification. The BOD is well aware of what it will take to get a deal passed, they have communicated this to AMR, but they don't seem to understand. The line pilots know that this is up to them. This is going to be a long drawn out situation. The UCC needs to understand that if they want 50 cents on the dollar then we need to have a decent deal, one that recognizes what we have given up in the past, ie 2003, and what we bring to the table. If the UCC fails to realize what we bring to the table, then they will be hard pressed to get 20 cents on the dollar.

The junior pilots are done with all the crap that has gone here since 9/11. Our careers have gone nowhere, our pensions are being stolen, never having a pay raise, while working for 1992 payrates while our buying power has diminished by 30%. We will burn this place down! The UCC and AMR need to realize this, but I don't think that they do. Our BOD is trying to keep a lid on this, but I don't think that they will be able to do that. There is a lit powder keg out on the line that is getting ready to go off. Horton was in our training cafeteria the other day giving a speech, and he was told that if the changes that are scheduled to be implemented in November go into effect, that there will would be hell to pay. If he thought September was bad, wait till November. He may have heard a bit of it, because instead of us getting no retirement contribution starting we will instead get 11% into a our supersaver program.

This will be interesting.

Yes, this next attempt has real potential for disaster. It's well known certain reps who were weak in the past are still rubbery, so what happens at the BOD level is one thing. The other thing is what happens at the line level. IMO, management believes and has possibly convinced the UCC that they can get a new agreement marginal on pay rates and still very weak on scope a 50%+1 approval from the pilots. The BOD promised the pilots no LBFO 2 and if they pass such a thing and try to sell it like last time, there will be an uproar and it will be APA on the defensive just like the company. Should that occur, they may convert some who were on the fence before, but others who voted yes previously are now angry, so I think such a TA would still fail. If the next TA fails, current APA leaders won't get a third chance and the UCC would then be left with either continuing to support Horton and presenting a stand alone plan with no pilots contract or turning to Parker who has 3 signed contracts in his pocket.

If Horton somehow succeeds in moving forward and exiting chapter 11 with the pilots in this situation, I believe senior pilot attrition will be severe next summer and there will be no ability for AMR to stop it and it will be devastating to AA ops and anyone who banked on equity like most of the creditors will lose large amounts of value and will be powerless to stop it. The only way to stop excessive attrition, would be a very good Industry leading contract, which means they end up paying more in the long run for putting themselves in a position of lost leverage.

Many pilots believe its better to wait until AA is out of bankruptcy to deal on a contract instead of negotiating a bankruptcy contract in bankruptcy. If a TA develops and is sent to the pilots that is perceived as LBFO 2, all it will likely do is ensure the UCC has the 2 clear cut choices above. Once out of bankruptcy, there IS no UCC that has any say about anything and they are then just hostages to a situation they have no control or influence of. I think that if that is the position they are in next summer, it means most of their value is tethered to a stock price that will probably plummet right out of the gate as AA likely begins it official (and possibly final) implosion. That's a very helpless place to be for bankruptcy creditors who once had influence but chose to join the philosophy of "kicking the can" for too long, which has proven to fail repeatedly.

Personally, I'm already a "no" vote as that is my mindset based on what I've heard. It will be up to AMR and the APA to convince me otherwise. Threats and intimidation need not apply. I consider myself a moderate and understand the present situation, so if its something even I can't swallow, it will indeed be a deal to walk away from regardless of the consequences. It should be a good show though, so stay tuned.

That is truly a shame. I had been hearing good things from the talks... apparently that is not the case.

I had a suspicion that there would be an attempt in early October to "can kick" through the critical holiday months in some fashion, but if it truly is a LBFO V 2.0, then it's over.

Why in the hell can't they negotiate a short contract? I suspect LBFO I would have passed if it was a 2 year contract with limitations on how long a new contract could be forged after the amenable date.

Is AMR really this shortsighted and stupid to lose it all? They'd get their YES vote with a simple contract that is even close to parity with Delta or the new UAL deal.

Negotiating Update for Oct. 30, 2012

posted on October 30, 2012 11:41
Fellow pilots,

This update will be somewhat longer than normal as we try to give you as much information and perspective as possible regarding the current circumstances.
Sometimes, at the end-game, things tend to get quiet, as the parties struggle to determine whether a deal is genuinely attainable. Dynamics at the negotiating table are an endless emotional rollercoaster. Sometimes things get so contentious that we need to take healthy breaks and park certain subjects and even change up the personalities on both sides to keep things moving forward in a professional manner. At other times, we build momentum and a healthy amount of progress is made.
Suffice it to say that we (the Negotiating Committee, National Officers and Board of Directors) hear you loud and clear. With your vote, you are the final authority in the decision-making process. We are mindful of that fact every day we spend at the negotiating table.
In this current round of negotiations, we have confirmed what many of you believed — that there are improvements to be had compared to management's “last, best, final offer” (LBFO). A number of those improvements have already surfaced at the table. By rejecting the original TA, the membership gave us the tools to be able to go further in the bankruptcy process than any other pilot group has dared to go. Ultimately, we believe management will make the moves they need to make on the remaining key deal points so we can embrace an industry-standard contract and look forward to rebuilding our careers.
Reaching a deal in bankruptcy means we strive to achieve the maximum value possible in a process where an agreement must ultimately be approved by a bankruptcy judge. Before approving an agreement, a judge must evaluate a number of legal standards and inputs from the debtor and the Unsecured Creditors’ Committee (UCC). On a number of issues, the UCC recognizes our genuine concerns and they continue to confirm their commitment to our 13.5 percent equity claim, as long as an agreement is reached “promptly and such agreement is within reasonably justifiable economic parameters.”
To receive bankruptcy court approval for our claim, we need to reach an agreement approved by the bankruptcy court judge. If no agreement is reached, AMR has the right to impose work rules and we must litigate for our claim. While we may be ultimately successful, this approach carries risks, especially without the weight of the UCC on our side and in light of some difficult case law.
So what are the options ahead?
At the risk of stating the obvious, that "Green Book with Delta Rates" or "Delta Rates on Date-of-Signing With No Gives on Scope" are things we would love to deliver in this process, but not anything we can realistically expect the UCC to support or the bankruptcy judge to approve. The only path to those goals would be to acknowledge that we won't achieve an agreement inside bankruptcy, and that we are willing to accept whatever rocky ride lies ahead and whatever time it takes to reach those goals. That is a potential path, but it carries with it a great deal of risk and uncertainty. We must all decide on our path together. We should be mindful that our advisers tell us the current market appears to value our equity claim at a level that would provide a six-figure cash payout per pilot on average. Our advisers anticipate that such a payout could be realized at or near AMR’s emergence from bankruptcy for those pilots who elect for a payout at that time. We’re unwilling to accept any deal based solely upon an equity stake, but part of the decision involves weighing the potential "bird in hand" against the "path less traveled" where we would have to litigate for the claim.
Is an industry-standard contract achievable inside bankruptcy? Our opinion is yes. But we don't want to play cute with words or try to spin things, so let's review the surreal process over the past 12 months and examine what "industry standards" include.
When AMR filed Chapter 11 bankruptcy, we were flooded with phone calls and e-mails asking us how much we thought the pay cuts would be. After negotiations with AMR in February and March 2012 failed to produce any results, US Airways management entered the picture and we negotiated a conditional labor agreement (CLA) with them that served several purposes. The CLA preserves a very substantial amount of the Green Book, with nearly half of the concessions accounted for by freezing our defined-benefit pension plan. The CLA is a historic document and puts more tangible pressure on AMR management than any other labor group has ever been able to exert on a management inside the bankruptcy process.
Following a very contentious court process in May 2012, we entered into court-directed mediated talks with AMR. No agreement was reached and we were left with an LBFO to take to the membership for a vote. The overwhelming “no” vote was less about the contents of the potential contract ― and more a collective decision to go down a different path than the one put in front of us. We are now approaching the point where we will need to collectively make another major decision together.
"Industry standard" likely connotes different things to different pilots. Universally, we all seem to agree that we want Delta pay rates—pay rates that more appropriately compensate us for the enormous responsibility we assume each time we sit down in a cockpit. From there, it gets more complex.
The following are elements of the tentative agreement we all recently voted upon that could be fairly characterized as industry standard:
- Green Book duty rigs (close to Delta)
- No night pay (same as Delta and United)
- International override only paid for trips flown (same as Delta and United)
- Frozen defined benefit plan with 14% follow-on plan (vs. terminated plan and 15% at Delta, terminated plan with 16% at United, 9.2% 401(k) match at Southwest)
- Distance learning paid at 1 for 3 rate (same as Delta)
- Sequence protection notification and obligation period (close approximation to Delta provisions)
- Rapid reaccrual limited to hours used (same as carriers who have rapid reaccrual)
- Elimination of 46-hour max sick charge on reserve (other carriers charge for trips missed. Delta has a unique annual sick program)
- Sick sellback at retirement to a health retirement account up to $25,000 (no retiree medical at Delta)
- PBS (Delta, United, Continental, America West)
- 84-hour monthly average line value (same as Delta, lower than United, Southwest, FedEx, UPS, US Airways and America West)
- Active medical cost-sharing approximately 20% (same range as Delta)
- Pay banding (yes at United, no at Delta)
- We were the only pilot group with no contractual sick verification
- Total vacation value at 10-year point and 24-year point, in line with industry average for legacy carriers
- Reserve 18 days for 73 hours (most carriers 18 days or more. Industry average 18.6)
- Scope: 79-seat jets (Delta, 76-seat jets, 86k max MTOW)
- Codeshare: 50% limit of domestic ASMs (Delta fairly restrictive, United must only notify union of code-shares)
Our point is that a pursuit of Delta pay rates must be accompanied by an intellectually honest acknowledgement that many provisions in the Delta contract (and most likely the new United agreement) are concessions from the Green Book. We encourage all pilots to review the Delta Contract Comparison for more details on what constitutes “industry standard.”
So what’s next?
There is potential for an agreement with AMR in the days ahead, but it all comes down to a number of moves management will need to make on key deal points to bring us into the realm of industry standard. If an agreement comes to fruition and is approved by the membership, we would secure the claim. We would also strengthen our position on the UCC to influence strategic alternatives, the selection of future management and the makeup of the reorganized airline’s board of directors. Our advisers have had extensive discussions with large financial creditors that hold substantial unsecured claims and are confident in the alignment of interests around the need for the appointment of a new board of directors at the airline. The board would then appoint management to lead the reorganized company.
We all need to evaluate any agreement on its merits and as something we might live with for some time. We also need to view an agreement as a potential path to the US Airways CLA. Your Board of Directors has given the Negotiating Committee clear guidance on what to pursue at the bargaining table. The onus is now on management to take the conversation where it should have gone a long time ago.
We are proud to represent all of you at the negotiating table in this very challenging process.

Your APA Negotiating Committee

This thing has been a real roller coaster.

Something we at AA have to accept is that, in the past, we've had a few contractural elements that were exceptional... in that AA simply did it quite DIFFERENT, not necessarily better or worse, than other legacies.

Sick, vacation, retirement, bidding, etc. These are going to be brought in-line. Giant retirement lump sums are gone forever. Lines are going to be higher time. Work rules are going to change.

If what is described above is presented as a package, AND with a secured 13.5% equity stake, I'd be leaning towards a yes vote, and I think a TA would pass.

They mention 79 seat scope, i would suggest that is sub-standard industry wide. Only usair has outsourced airframes running at 79 seats. As legacy airlines go, airways is the smallest. Delta maxes at 76 seats and united at 70. If amr pushes 79 it will put more pressure on delta and united to further relax scope. Outsourcing scope may not affect you directly and/or immediately but it will tarnish your brand and diminishes your negotiating clout in the future. Please consider these facts and retain as much scope as possible.

Here you go again. Why do pilots feel satisfied negotiating a deal based on a promise of what might happen down the road. "Take this deal and each pilot MAY get a six figure check." What a bunch of chumps if the AA pilots fall for this type of deal again. Come on guys and gals have you already forgotten 2003? If the judge will not approve an industry LEADING contract then suck it up and prepare for a battle in the streets post BK. Don't be fooled again!

As a summary of industry wide pilot compensation, scope and work rules this statement is a testament as to how far the airline pilot profession has fallen since deregulation. The "associations" have failed to protect the profession and been slow to react to the new post deregulation industry, conducting business like it is still 1975. Remember, a narrow body captain working only 75 hours a month at DAL in 1978 had an income equal to what we only hope a 777 captain makes today working many more hours with far fewer benefits. Unfortunately most pilots are ignorant of their history and are more interested in how many gizmos they can carry in their backpacks than trying to learn from their history. Very sad.

it appears much of the APA leadership remains out of touch with the pilots who sent THEM a message as much as they did AMR with the faliure of the first TA. Perhaps a "groundhog day" moment is in order. Should that occur, I'd expect many of the reps to be recalled and months of delay for another chance at any type of consensual agreement, unless the UCC just plows ahead with Horton wthout the pilots or punts to Parker with the pilots.

APA leadership(?) out of touch, say it ain't so. Unfortunately the membership is out of touch as are most members of the airline pilot profession. Relying on negotiating tactics and associations designed in the 1930's for a regulated industry is what is out of touch. Working under the thumb of government regulations written in 1926 is out of touch. Pilots refuse to take the action necessary to protect and promote their profession thus you see pilots reduced to bus driver status in the eyes of their employers, fellow employees and the general public. The entire pilot profession should have taken action the moment the first pilot lost the first dime due to a bankruptcy ruling, but we all know what happened, nothing. Very sad.

Heard a rumor that talks have broken down. Progress was made on the little stuff, but once they got to pay/scope/etc there was no movement.

So looks like the goal has not been reached and no TA this far?

I can't argue with a lot of this. This profession is in shambles and there's plenty of blame to go around. I hope to laugh my *** off in a few years watching airline execs trying to staff the regionals. Within a few years, the immutable laws of supply and demand will kick-in and I'll happily sell myself to the highest bidder and take no prisoners in the process.

I doubt AA will be able or willing to afford me then. :rolleyes:

APA has and is totally failing their membership. We've done everything asked of us by them and they've done virtually nothing asked of them by us.

The "Chihuahua Brigade" has recessed in DFW for the weekend ........again. They were suckered by AMR again into a kick-the-can facade and here we are. I'm a Parker disciple from here on out and I don't care what Horton offers anymore. I'll wait till hell freezes over under 1113 provisions to make that happen. I couldn't care less about the UCC either and I'll laugh if there future AA stock value tanks when AA emerges from BK in a shambles awith a plummeting stock price and major pilot attrition in progress.

I'm afraid that you are screwed then.

Life goes on.

Unfortunately there always seems to be enough folks out there willing to sit in the seat with the rap around window. Management doesn't give a rats behind about qualifications and as long as the profession allows the federal government to determine the qualifications required to sit up front, there will always be "qualified" applicants by the thousands. This is just one of the many failures of the associations the pilots have put their trust in to manage the airline pilot profession. Rumors of a pilot shortage are as old as I am, and that says something.
Looking to Parker as a better alternative is kind of like slave who has just been sold looking for the silver lining in the fact that he will have a new master. He is still a slave.

then if as a slave i have a choice, then parker would be it. why, amr management wants to run a travel agency not an airline, parker wants to run an airline. that means in my opinion longer security with parker than amr management.

I can't think of many pilots in the passenger airline business who wouldn't be considered "slaves" as per your opinion, except perhaps Southwest pilots.......it's simply a matter of degree. Major airlines will have plenty of pilots in the future, but regionals not so. I suppose they could run 10,000 chimps through and get one potential F/O, but considering how many they'll need and he number of RJ's they're hot for, this time I'm sure they'll fall well short.

I can't wait to watch.

Not just FO's... Chimps make excellent Captains as well. The good news is, they will always take the fruit plate, and you'll get the omelette. And since they can't read, they don't mind if you do.

They can be a handful on layovers, though. And they throw poo at you if they don't like your technique.

http://www.freakingnews.com/pictures...lot--66212.jpg

Robert Crandall was supposedly interested in running an airline also, but look at what those who learned at his knee have done to AA. Looking at US Air it seems as though Parker is content to run a sub par operation as long as he can keep the pilots at each others throats. Due to the way we progress based on our senority, pilots are indeed in indentured servitude to their respective employers. Yes they can quit but at what cost? Until pilots put away the 1930s' associations that do nothing but promote false loyalties and failed plans, the pilot profession will continue to flounder.

...deserves repeating.

I wish that this were true. However all of the new contracts are focusing on scope for a reason. Simply make yourself a google alert for airline globalization, code sharing,liberalization, etc. The new source for the labor supply side is the world. Sure there will be a short period where there are enough trained pilots but this will not last.

Not saying that there is absolutely nothing worse than Parker but make no mistake he is already working this deal in a way that he hopes will create resentment among pilots. Now that he has been told twice by a judge that he can negotiate with his own pilots he has filed a motion asking the Judge to vacate the decision. This is simply more delay tactics. Let me assure you that it would not have taken more than the airline could afford for Parker to have put enough on the table to get movement from both sides on this seniority issue. Be very careful what you wish for.

Funny that usair pilots had a new contract with only 3 open sections left back in 2007. Then they decided to boycott negotiations, kick out their union and re-open everyone of the 23 closed contract sections and start from scratch, yet Parker is to blame. Ok

Cacti- I am not remotely interested in co-opting this thread. We already have plenty of threads already dedicated to that end. So I will just say to American pilots, educate yourself and do what you think is best. Far be it for me (part of the group who voted in LOA 93, although I voted NO)to presume to tell them what they should do.

There will be no agreement prior to the release of United's pending TA in the next week or two. Theirs will set a benchmark even higher than Delta's.

You guys have to understand... if Parker is Hitler, then Horton is Satan. We are being forced to choose between two terrible options.

This is why you've lost respect with so many pilots. You turn every thread into an east vs. west. Let it lie, going back and forth on here will solve nothing.

The NIC provides for the greatest windfall ever for a pilot group. No exceptions in history.

This is the motivation of folks like boss.

Never in thier wildest dreams would this career expectation be a reallity without the aberation of the NIC. Keep in mind AWA was not an airline of choice for a career.

The old US Airways is the only reason you still hear thier callsign on the radio.

I support the east pilots to prevent the NIC from ever being a standard senority resolution on any other pilot group.

Op was providing amr pilots inacurate information re. Parker so I corrected the information. Lack of contract at Us is not Parker's doing and shouldn't be used to judge his actions on the lcc/us possible merger.

Without rehashing the East/West positions. There are clear facts about Doug Parker's reaction to the current airline climate that speak for themselves. First the RLA dictates that contracts become amendable- they do not expire. So based on his behavior, a contract signed today will not end when the company shows an increased profit. However, if hard times are on the horizon, the company does not need a contract to get out of their obligations. Furthermore scope clauses can have devastating results if ownership laws change, if code sharing increases- any number of globalization scenarios can have profound effects on the profession. But Cacti, you go ahead and put your trust in the integrity and fair-mindedness of Doug Parker. Continue to live in that old mindset that taught us that management respected pilots- that pilots were somehow different from the rest of the labor side of the equation.

I don't live in any mindset, facts are facts. The term sheet with the apa addresses the issue of "stalemate" by using binding arbitration to quickly move the process along.

Supposedly an agreement is just about finalized between AMR and APA. If and when that occurs, a 7 day review by the BOD will happen to turn it into a TA or require changes. Sounds like a few paragraphs of language are all that needs to be agreed to or so the claim.

By "binding" do you mean "binding" or the other kind of "binding"? You know, the binding that's not really binding.