SilverandSore

What happens if the no votes prevail and the following occurs...

*Doug takes it to arbitration...
*We get the arbitrated rates (which according to the MOU are in the neighborhood of 16.5%) but factoring in a new Delta rate we may or may not get 20% because of the United ratio...
*We then try to get more on top of the parity review by selling our 'gives' (I'm confused how the gives only come to $85 million when it was said the Dom/Int were worth $20 million a year), so I'll be generous and call it $200 million total...
*We then have an arbitrated deal worth less than the current deal with the same give aways and possibly a duration of a year or two shorter leaving us with the same negotiating power for the next contract...
*But then Doug does what he says he'll do, and offers us the current deal.

And here's the 'what happens if'...

Won't the union take a bigger hit in credibility if they have to offer another vote between the two contracts? I see the potential for the union to look even weaker come the next contract. With the cost neutral arbitration Doug can't lose, that contract, with the gives, no matter what, will be worth less than the current offer. We've still giving up the concessions, the contract pays less overall and the union is forced to again offer Doug's current offer as an alternative to the arbitrated one.

Where can we improve on the arbitrated contract if our 'gives' are valued less than the $1.7 billion currently offered? Because to make the arbitrated contract worth more we have to sell some of the concessions (in the hopes that their real value is worth more). If it comes up short we're left holding our dic.... shorts and Doug has the opportunity to trump us again.

What path in arbitration gives us an upper hand to use in the next contract?

eaglefly

For LAA pilots it's sobering to watch what a few years can do to emphasize consideration of the long run.....or the failure to. In just a few years, say perhaps the end of this year, AMR/AAG will have successfully converted the pilots pensions into executive bonuses and shareholder profits, i.e., the successful transfer of wealth FROM the pilots TO the executives and shareholders.

Now, many of the pilots are willing to double-down FOR those executives and shareholders to ensure they (the pilots) have no leverage to return anything in the future. It simply boggles the mind just how skewed the airline pilot mentality can truly be and looking at industry history and especially legacy AA and legacy US Airways history, I think it's beyond hope of ever changing.

I guess pilots will remain stupid in perpetuity at their own peril and so what can you do ?

eaglefly

It's not just us watching our own car wreck from inside the car. Doug, Scott and Jerry are on the sidewalk with a case of cold beer having thrown oil all over the road perched for a nice view to see how we handle it. If the impact Friday is bone-crushing and decapitating, those that make it out of the mangled conflagration will only end up driving down the same road in 2020 with the same 3 stooges sipping cold beer and watching from safety.

The only difference will be that then they will already know how we drive and there will be even more oil on the road.

eaglefly

They key to arbitration is to retain as much of the Green Book as possible and still take the majority of our raises whatever the percentage starting in 2016. We still get annual increases then too, yes ? Section 6 starts sooner. The situation then means that AAG has uncertain future labor cost projections combined with rock bottom poor labor relations, especially with the pilots. Parker loses credibility. It also proves that even if the APA BOD is weak and fragmented, the pilots are unified. A rejection now should begin a house-cleaning at APA and two of the first heads that need to roll are Wilson and Roghair.

Those two have ****ed this situation up at every turn since their decision to run to Parker, through LBFO I, past the robocall and LBFO II to the sale of profit-sharing for peanuts, the abomination of the equity claim situation and now the imminently disastrous JCBA. We'd be better off with Obama and Holder. APA has also failed miserably at Communication in regards to publicly highlighting the reality that this management is no different from past managements in that (among other things), they DO NOT do what they say they will do and that this airline isn't any different from the past dysfunctional, talentless industry follower it used to be and that new paint, uniforms and that the empty claims by executives with ca$h-filled pockets or their junkyard dog union-busting strategists have not and will not change that.

Of course, the other strategy by some here is to just take the deal however feeble and then........um.......well, "move the ball forward", whatever that means.

drinksonme

How many of you screaming at YES voters were YES voters on the MTA/MOU? Just curious, because if you fit that description you are the biggest hypocrites who chased the cash without reading the details. You allowed the Trojan Horse in already...or my favorite analogy when trying to rationalize your position....already OWN the pretend car, it's the all new MTA parked in your driveway. Please spare us your buyers remorse venting and lack of understanding when YOU VOTED YES ON THE MTA, and now spew for a NO vote. It is pathetic. It's funny people freely admit voting Yes on the MTA, but will now act like the JCBA is the worst deal ever. That's why I do not listen to anyone's opinion, because no one really knows anythings. It's all just semantics and BS.

If you voted No on the MTA, then carry on.

Oh and I am a NO voter too....

ERflyer

So the bottom line is that it's going to pass because of the increased pay rates?

eaglefly

Yes, it's LIKELY (not certain) to pass because of that. Oh, there are a multitude of rationalizations to muddy that reality up, but when you cook it down in the spoon, that's the only thing there that will get anyone high.

As we speak, thousands of junkies at this airline have been dreaming of the sensation when the needle slides in and the slowly push the plunger down. Junkies never concern themselves where their next hit is coming from as long as they still have a hit in front of them.

Wiskey Driver

This is an interesting analogy you have begun with and one with which most do not understand, yourself included. See the MTA was a means to an end for lack of better terms. The LAA pilots we hell bent on getting rid of the current AA management under Horton that they virtually sold their souls to do it. Now us LUS west pilots were hell bent on killing usapa and by any means necessary. The signing of the MTA to make APA the new agent assured us of ridding ourselves of that evil. Now LUS east just wanted to get paid and figured they could get paid and win in SLI so it was basically a win win there.

Management took advantage of the situation and everyone got basically what they wanted AT THAT TIME. Now you could claim buyers remorse but again it all falls back on what was wanted and or needed during that time.

I guess basically what I am saying is that using the MTA yes voters as a means to make your point is really a bad choice. I have no idea how this thing is going to turn out but I am uncomfortable either way.

WD at AWA

flyhawk

Thank you for some good points. I'm not sure if any of this was directed at my earlier post, but does it really matter? That's past history and we are where we are. I, for one, don't fit into either of your options. I wasn't here to vote on the MTA at the time, so, although I agree with you in principle, that many of these problems stem from the original MTA vote, it just doesn't really matter at this point.

WD makes great points and I agree totally. You're not comparing apples to apples. Either way, here we are.....

Let's worry about what we can affect which is the vote right now. Let's surprise people and stand together as a group.

DCA A321 FO

IS GIVING AWAY OUR ABILITY TO NEGOTIATE MEDICAL BENEFITS IN RETURN FOR THE $$ A YEAR EARLIER REALLY WORTH IT?
INDIVIDUALLY, WE’LL ALL FIND OUT

Dear PHL Pilots,
As we approach the last few days of voting, we want to go over what we believe to be the most important issue before us: If we vote affirmatively for this JCBA, we shall, (without any question) – be voting to completely lose, forever, the right and ability to negotiate our medical benefits, in exchange for a significant but very temporary hourly pay-rate advantage over our peers at Delta. As the Green Book is written, today, Supplement K allows the company to make some changes to our medical benefits. If the JCBA passes however, the company will then be permitted to make any changes it desires, including terminating the standard and/or core options and we will have ZERO recourse.
While the company’s Dec. 23 ultimatum includes several troublesome concessions, it is our opinion that the most serious concession is the ability for this management team to reduce or eliminate the medical benefits of pilots, spouses and our dependents. Unlike today, we would be powerless to do anything to prevent it; that is the language of the JCBA on which we are now voting.
And before anyone criticizes us for not acknowledging the positive, we acknowledge the company’s Dec. 23 ultimatum has industry-leading pay rates through at least 2015. Beyond that is anyone’s guess. By the same logic, it would be disingenuous to ignore the past and likely future successes of the pilots at Delta in their negotiations with management. Their last contract set the standard for compensation and benefits and their next contract will likely do so again this year. Did we mention that Delta traditionally settles their pilot contracts early in the negotiating process?
While no one ever believes illness will come knocking on their door, ask yourself this very simple question: Is waiting another year for a substantial pay raise worth the ability to provide adequate health coverage for yourself and your family? Just as important, ask yourself this question: By voting yes and thus giving away APA’s ability to collectively negotiate many of your health benefits, do you really trust this management team to do the right thing and maintain medical coverage above the absolute minimum required by law, if by doing so will result in increased cost to the corporation?
The “tease” facing pilots is to accept the company’s Dec. 23 take-it-or-leave-it proposal and with it, agree to a one-sided LOA 15-02 process that will ultimately permit the company to modify, reduce, or eliminate our medical benefits and we will be powerless to do anything to stop it OR we can wait 11 months and receive much of that raise anyway and prevent the company from potentially decimating our medical benefits.
We believe trading health coverage for a raise a year earlier is extremely shortsighted, not to mention potentially both medical and financial insanity. And yes, we fully understand the pay differential lost until next January’s mid-contract adjustment may never be recouped; however, in return, we will not give the company an absolute right to modify or terminate our current health benefits. While no one ever believes serious illness will affect them or their family, is a reduced or eliminated medical benefit/coverage really worth trading for a pay bump a year earlier?
As of today, the only contractual option that is excluded from the benefits tax is the core option. This means the company will have the ability to either modify or possibly eliminate the standard option. Further, unlike today, we will not be able to do anything to prevent it.
Below are the 10 steps that outline the process from LOA 15-02, Benefits Excise Tax. If, after reading the procedure below, you truly feel comfortable with what may occur with respect to your medical benefits, then maybe you can vote “yes.” However, if you, like us, believe you can wait another 11 months for a significant pay bump, while not granting any concessions, medical benefits and otherwise, then you may want to consider voting “no.”
Below is the actual language and agreed-to process with our comments in red:
1) In the event the Company determines the Standard or Core design options provided for in this agreement would be or become subject to an excise tax or penalty….
The problem with this sentence is twofold. First, APA has absolutely no say in making the determination. Second, the words would be means if the company believes a penalty or tax will occur sometime in the future, they are free to begin the process outlined in LOA 15-02 beforehand. Just how much in advance of the actual tax or penalty remains to be seen. 2016, 2017? Remember, with this language the company can implement this LOA well in advance of the tax or penalty ever occurring.
2) The Company will “meet and confer” in good faith in order to reach agreement with the Union concerning the minimum modification or modifications necessary to avoid application of excise tax or other penalty.
If you think the “meet and confer” language allows us to negotiate the requested modifications, think again. Former Negotiating Committee chairman DiOrio, became very familiar with this language. During east-west contract negotiations, we “met and conferred” with the company regarding the A330 crew rest facility. The company made it very clear from the onset that “meet and confer” was not a negotiation; rather, it was the company explaining to us what they were going to do, and while they would listen to our input/concerns, we were unable to change it. Many of the same individuals who told us what “meet and confer” meant then are the key players today. So if you believe “meet and confer” has some different meaning for this process, you’d better think again. If the company intended for this to be a negotiation, they would have used “negotiation” in the language rather than “meet and confer.”
3) If the Company and Union are unable to agree on modifications necessary to avoid the application of the excise tax or other penalty on the Affected Option within 90 days of the initial meeting, the parties will select Arbitrator Bloch who will determine the modifications to the design of the Affected Option that will become applicable.
So assuming APA does not sign off on the company’s planned benefit modifications (reduced medical benefits), then an arbitrator will determine the medical benefits for pilots, spouses and dependents. Does anybody else believe having an arbitrator possibly determine the medical benefits for pilots at the world’s largest and most profitable airline is unbelievable?
4) If Arbitrator Bloch determines no reasonable practical modification to the Affected Option can guarantee no excise tax or other penalty will apply then the Company shall have the right to terminate the availability of the Affected Option to the Pilots.
We are asking an arbitrator to GUARANTEE the company will not be subject to the tax or other penalty. We’ll go out on a limb and speculate that arbitrator Bloch will be unable (or unwilling) to guarantee the application of the tax or penalty will not apply, and therefore the company will then have the right to terminate the affected option.
Let’s recap. 1) Company makes determination. 2) Meet and confer, aka, this is the benefit or plan we are going to eliminate. 3) Arbitrator unable to guarantee no tax or penalty will occur. 4) Company can terminate the affected option(s).
The problem with this process is if the company wants to eliminate or modify an option, all they have to do is determine the option would be subject to an excise tax or penalty (it’s irrelevant whether or not it is ultimately subject to the tax or penalty, step 10 below ) and just jump through a few hoops to either reduce the benefit or terminate an option.
In reality, the above language translates to: In the event the Company determines the Standard or Core design options provided for in this agreement would be or become subject to an excise tax or penalty (step 1) then the Company shall have the right to terminate the availability of the Affected Option to the Pilots (step 4). Steps 2 and 3 are only there for optics.
5) If under number 4 above, the Company has terminated or would have the right to terminate the availability of the Pilots Standard and/or the Core Option, the arbitrator will be empowered to design an alternative Option design that is available from the Company provider and that replicates the provisions of the Core Option to the greatest possible extent without causing the New Option to become subject to the excise tax or other penalty.
We read this a few times to confirm we understood what was agreed to. Unfortunately, it was understood correctly the first time. If the company has the right to terminate an option, then we are agreeing to allow an arbitrator to design our medical option(s). Aside from the absurdity of this provision, does anyone actually believe arbitrator Bloch is really going to mandate a medical plan for 15,000 AA pilots? My guess is he’ll punt it back to the company (see 6 below).
6) If Arbitrator Bloch has not issued a determination prior to the excise tax or penalty becoming due or if such penalty or excise tax is otherwise owed for any reason, notwithstanding any contrary provision of law, the Company shall be permitted to implement such modifications to the design of the Affected Option as it considers to be necessary to avoid the excise tax or penalty.
Once again, this “process” permits the company to implement anything on which it wants to avoid paying the tax or penalty. Putting our skepticism aside, does anyone truly believe we will not ultimately end up at numbers 4 and 6 above?
7) If any Option is modified or eliminated the parties will meet and confer to determine how the savings, if any, from such modifications will accrue to the pilots.
Here we go again with this “meet and confer” language. We don’t know about you, but we would much rather have the medical benefit when we need it rather than a few dollars more a month via a reduced benefit. We’re willing to bet the money distributed to the pilots that will be generated from the medical benefit reduction/savings will pale in comparison to what it will cost that same pilot to go onto the market and buy a similar replacement benefit.
Alternatively, assuming we don’t negotiate another JCBA, which we believe will occur, we can wait 11 months for our raise and not give up anything in return.
8) The saving from the avoidance of the excise tax will not be considered in the savings calculation.
Why is the company realizing 100% of the tax savings yet the pilots and their families are the ones who are paying the price via a medical benefit reduction or plan elimination? Does this seem equitable to you? Another cost savings inequality is the realization that many pilots who currently receive medical benefits through our employer we likely go elsewhere following the reduction(s). Because the company pays 80% of the premiums, this will result in a potentially tremendous savings to the company. Unfortunately, we will not receive any credit resulting from the probably mass exodus.
Recap #2:
1. Company reduces or eliminates medical benefits. 2. Pilots are required to subsidize inadequate company-provided medical benefit, at considerable cost. 3. Hundreds or possibly thousands of pilots leave company-provided medical insurance, resulting in additional savings to company. 4. Company realizes millions of dollars in tax savings. 5. Pilots receive zero from this savings.

9) If the parties cannot agree on whether cost savings exist or how to distribute said savings, the matter may be referred to an arbitrator.
See you at the arbitration.
10) In no event shall the arbitrator order modifications to or reinstate a plan.
We have heard from some pilots who tell us we don’t need to worry about LOA 15-02 because the Patient Protection and Affordable Care Act will not survive and the accompanying tax will never occur, so what is the problem?
Please read numbers 1 and 10 above very carefully. Number 1 allows the company to begin the process in advance of the actual tax or penalty date. How far in advance is not defined. Let’s assume the reductions begin for the 2017 benefit year. Now let’s assume that after that date, the law is changed and/or modified and the tax/penalty never occurs. Guess what? The language in number 10 above prevents any reinstatement. Now ask yourself if it isn’t in the company’s best interest to invoke LOA 15-02 as soon as possible while knowing full well that if the law is changed and there is no longer any tax, the company is not obligated to reinstate any plans or modifications. How is this equitable?