MaydayMark

OK Turps ...

After more research, this is a more complicated question than I imagined. As an example, has PWC paid the HKG folks Hong Kong taxes yet for 2008/9 tax years? At least one PWC bubba says he doesn't believe so (he says they'll catch up in 2010, so I suppose those taxes still remain an unknown)?

What is more clear however is that we (FDA folks) do not seem to get the financial advantage normally afforded for the Foreign Earned Income Tax Exclusion.

Foreign Earned Income Exclusion - IRS Form 2555

FedEx gets to KEEP this tax credit!

Why would that be except that we (via ALPA FDA/LOA) agreed that it would not apply to FedEx pilot stationed at an FDA? Why would we agree to that (except for that, "It's the best we can get" nonsense.)?

Concerning tax equalization ... what if you currently live in a high tax US state? Will the company withhold (and possibly profit?) by withholding state income taxes? It seems the answer to that is not simple either, it depends on the state.

As for me, I think I'd rather just keep paying my own US IRS obligations and let the company be responsible for any incurred foreign liability (like MANY other international companies do).

If you need more details I can probably get you in touch with the PWC folks.

Regards ... MM

pinseeker

..........

golfandfly

Chuck,

I doubt you were highly affected by 4.A.2.b. Your fine aviators, who will be on the bottom of the list, will be certainly effected if we enter 4.A.2.b. It is something that needs to be addressed. Your friends in management kept us in 4.A.2.b much longer than necessary, we went from 800 overmanned to completely undermanned in months. I don't hold it against them, it's just business. However, I don't trust them either. Many of us worked (reserves) the same days for 10 hours less pay per month. I don't know if it will happen again or if it will effect me personally, I decided I wouldn't agree to a contract that didn't fix this clause.

I don't care if we ever fix the FDAs. It was good enough for those that bid it. I suggest they bid elsewhere if the deal isn't good enough for them.

The FDAs also allow for higher utilization of pilots. We will need fewer pilots if we approve this TA. Maybe we won't have room for your friends afterall..

Chuck Turpen

The FDAs also allow for higher utilization of pilots. We will need fewer pilots if we approve this TA. Maybe we won't have room for your friends afterall..[/QUOTE]

Golfandfly,


So does this same logic apply to ANC and LAX domiciles? Do you think that FedEx can afford to fly the global system out of MEM?

The increased volumes and flying in the FDA areas drives the cost up for running SIBA to a point to where it is more economical to open a domicile.
The increased flying also makes it more desirable to have reserves in theater rather than revising 5 pairings to fill one hole created in the system.

Domestic growth is flat and IP volumes domestically are on the decline.

The future growth is internationally. UPS and the other big cargo carriers are still sitting on their thumbs waiting for the economic recovery. By FedEx opening these new domiciles while the economy is still down or just starting to recover they are positioning us to take advantage of the upswing.

Yes we could turn down this TA and maybe stop FedEx from opening these domiciles until we negotiate a complete new contract. At the same time we will live with the same 4A2b language and the arbitrator's decision.

Seems to me FedEx is taking the risk here with the uncertanity in the world economy. We are getting better 4A2b language (not the best)and FDA enhancements, if the economy tubes they are worse off than they were.

I think that FedEx realizes the value of having FedEx pilots fly FedEx freight.

We can however price ourselves out of the equation.

The Walrus

Boy, no wonder why the store keepers in the 580 market love to see us coming. We couldn't negotiate our way out of a brown paper bag.

Gunter

delete delete

Gunter

Very funny. Do you also think it's funny they couldn't fill the FO slots? Even after excess bids? HA, HA!

If it's such a great deal, equalization with Wide FO vs. Narrow SO pay, why aren't they filled? Why is the company worried about opening an MD HKG domicile with the awesome deal you think they currently have?

iarapilot

I tend to agree.

golfandfly

Chuck,

I well thought out reply. And you are right, a European domicile and MD HKG base are more efficient. This efficiency that you speak of requires less pilots. It is expensive to SIBA, and you are right, one small change overseas can cause major headaches, deadhead expense, etc, for the company. This also adds major $$$ to our pockets. It costs the company money to have guys sit hotel standby in CDG.

I see the FDAs as a give back to some degree. We lose from our bidpacks in MEM/ANC/LAX. This effects the vast majority of us that choose to not move to an FDA. One good trip more than equals the 3% annual raise that we are being offered.

I'm not worried about them contracting out the work. We are negotiating and if they **** off enough of us, many won't fly above our BLG/RLG. Do you think the company could move their freight if we don't fly extra? How about in peak season? We have all kinds of leverage if we choose to use it.

I'm not talking about huge raises. There are some sections of the contract that don't involve flight/duty times that need to be addressed.

It seems the TA is good enough for you, and I'm sure you will vote accordingly. No hard feelings, again, it's just business.

Cheers

Chuck Turpen

The purpose of this thread was to discover the value of tax equilization to the pilot. While we still don't have the exact formula I think it is clear that the amount of foreign tax far exceeds the IRS benefit. Which makes the above statement false.

MaydayMark it is ok that you feel you should get the IRS benefit and also have the company pay all the foreign tax, maybe not realistic, but you are entitled to your opinion.