Read the above posts about the NMB. Thats the National Mediation Board. Ive been trying to tell some guys here that this 8% is going to be used to delay a CBA. Its going to cost more than it pays. Im done repeating myself. Do your own research guys- check out the RAH nightmare- We're headed for mediation, picketing and probably a strike vote- Good night

 

Or is it set at 15% now? I thought it was just that high now due to profits. Can someone explain exactly how it works now and how it will change? What is this 18% pre-tax margin?

 

Current plan as it is written in the PEA is 15% of pretax profit, minus 5% of eligible wages.

Let's say we had $1bil in pretax profit for the year. 15% of that is $150mil. JetBlue spent $900mil on eligible wages that same year, so 5% of $900 mil is $45mil. That leaves $105mil to be given out for PS. To find the percentage everyone gets you take $105mil divided by $900mil and get 11.6% payout.

New plan is focused on pretax margin. So let's say we had $1bil in pretax profit. We then look at our total revenue for that period, which we'll say was $6bil total revenue. That comes out to 16.6% pretax profit margin. Since that's less than 18% we would get 10% of the pretax profit ($1bil * 10% = $100mil for profit sharing).

If we had $1bil pretax profit, and only $5bil in total revenue that would equal a 20% profit margin. We'd get $100mil for PS like the above example, plus 20% of everything above 18% margin. 18% margin on $5bil is $900mil (we had $1bil pretax profit). So you take that extra $100mil * 20% and get an additional $20mil. Making a total of $120mil for PS.

Confused yet?

Just for reference, our current year to date results put us at 18.77% pretax margin.

 

Now that I've read into it, I'll give my opinion. It's a PR move. If we don't vote it in, they'll have the opportunity to tell the NMB that they offered and we voted it down. If we vote it in, it gives them a PR advantage if we end up picketing. All in all, I think taking the deal is in our better interest right now.

 

So to be clear your saying if the company makes 1 billion, on the old plan 105 million gets paid out and the new plan 100 million gets paid out. So how does this compare to the checks we would get?

 

So they are just doing this out of the goodness of their own heart.

Unreal....


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Using 2015 data we'd get less than we actually did. Using 2016 numbers we would probably get more under the new plan compared to the current one.

In the future I doubt we will make 18+% margins, so this plan probably won't be as good as the old one.

 

Won't matter. When we get our CBA, we'll have our own, negotiated PS separate from the rest of the work groups.

This one won't even affect us if we happen to get a CBA before 2017 ends.

 

Current plan is not 15%. That was last year. The current plan is each year management will decide what % it will be.

The new plan defines it.

 

Ok, yes the PEA Profit sharing plan was subject to change but I was using the formula given in that document. It isn't an arbitrary formula every year, and I never said the current plan was 15%.

Nailed it.