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Old 05-03-2007, 09:52 AM   #1  
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Default APA announces what they want! 30.5% pay raise

ALLIED PILOTS ASSOCIATION ISSUES DETAILS OF NON-VARIABLE COMPENSATION PLAN

“Our plan will enable our pilots to participate in our airline’s recovery.”

Fort Worth, Texas (May 3, 2007)—The Allied Pilots Association (APA), representing the 12,000 pilots of American Airlines (NYSE: AMR), announced today it has presented a plan for non-variable compensation designed to enable its pilots to share in the airline’s financial recovery. APA and American Airlines management are currently engaged in full-scale contract negotiations in accordance with Section 6 of the Railway Labor Act.

“Other American Airlines stakeholders have already recovered their investment in our airline’s turnaround,” said APA President Captain Ralph Hunter. “It is time for our pilots to begin doing the same.”

Under APA’s plan, the pilots would receive a 30.5 percent pay rate increase on the date of signing retroactive to May 1, 2008—the contract’s amendable date—and five percent annual pay rate increases thereafter. Over a three-year period, annual pay rate increases would average around 17 percent. The plan also calls for signing bonuses equaling 15 percent of each pilot’s total pay over the duration of the negotiations. Management triggered the “early-opener” provision of the current contract on July 21, 2006, marking the start of negotiations.

“Our airline’s management has clearly demonstrated the ability to adapt to higher operating costs in areas such as executive compensation,” he said. “We are confident the same will occur as part of appropriately paying our pilots.

“By accepting large bonuses during each of the past two years, management sent a strong signal to employees that it was time for financial recovery,” Hunter said. “We concur with that assessment.”

According to Hunter, senior executives at American Airlines have seen their incomes rise by more than 80 percent compounded annually since the airline’s consensual out-of-court restructuring in 2003. Shareholder return for AMR stockholders has averaged 90 percent annually during the same four-year period.

By contrast, American Airlines’ pilots experienced immediate pay cuts ranging from 20 to 50 percent as part of the 2003 restructuring, while nearly 3,000 lost their jobs. They continue to earn less than they were before the airline’s restructuring while working substantially more hours each month. Altogether, the pilots have provided $660 million in givebacks during each of the past four years for a total of more than $2.5 billion worth of concessions.

In recent polling conducted on APA’s behalf, the pilots have cited higher pay rates as their top priority in negotiations.

“Our pilots have spoken loud and clear that our next contract must include pay restoration,” Hunter said. “It is a prerequisite for them to ratify a new agreement.”

Hunter also reported that APA and the Southwest Airlines Pilots Association would be co-hosting an industry-wide collective bargaining conference in early June in Dallas as part of a concerted effort to reverse the damage inflicted on the pilot profession during the past several years.

“Pilots industry-wide are committed to pay restoration,” he said.

Hunter further noted that APA would present a separate plan for variable compensation as part of the ongoing negotiations.

Founded in 1963, the Allied Pilots Association—the largest independent pilot union in the U.S.—is headquartered in Fort Worth, Texas. APA represents the 12,000 pilots of American Airlines, including 2,799 pilots on furlough. The furloughs began shortly after the September 11, 2001 attacks. Also, several hundred American Airlines pilots are on full-time military leave of absence serving in the armed forces. The union’s Web site address is www.alliedpilots.org.

American Airlines is the nation’s largest passenger carrier.
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Old 05-03-2007, 11:21 AM   #2  
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Right On!

Not likely, but good to see they're at least asking!
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Old 05-03-2007, 11:29 AM   #3  
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The airline cannot afford that, due to paying their Exec's Huge Bonuses.
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Old 05-03-2007, 11:41 AM   #4  
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I dont know if they will get 30% raises and a huge bonus like the execs, but hopefully they will be able to shoot for the stars and hit the moon. Good luck!
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Old 05-03-2007, 03:15 PM   #5  
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These are the principal components of APA’s non-variable pay proposal.

Pay Rates: Increase all hourly pay rates 30.5 percent from the 5/1/2008 book rates on the date of signing.

Annual Pay Raise: Increase all hourly pay rates five percent annually thereafter for the life of a 36-month agreement.

Extended Pay Rates: Increase all hourly pay rates six percent annually from the amendable date of the contract being negotiated
now until the following contract is signed.

Retroactivity: All pay rate increases are to be retroactive to 5/1/2008 should this agreement not be complete by that date.

Signing Bonus: Pay a signing bonus of 15 percent of W2 income from 7/21/2006 (the date management opened on us) to the date of signing of this new contract.

The ancillary elements of APA’s pay proposal include:

New Hire Pay: Increase new hire pay to $4000 per month

Pay Date: Change pay dates so that 50 percent of pay is paid at the end of the current month with the balance paid by the 15th of the following month.

Night Differential: Increase Captain night differential to $6.50.

Premium Pay: Double time (200 percent of hourly rate) for all flying done on major holidays.

International Override: Increase International Override pay to $10/hour for Captains and $8/hour for First Officers.

Per Diem: Increase Per Diem to $3/hour International and $2.15 Domestic. Annual increases of $0.25 (international) and $0.10 (domestic) thereafter.

Over the next several days, you will receive additional information about this proposal, including an expanded discussion of the rationale for APA’s proposal. This Non-Variable Compensation package will be posted to the APA Web site and mailed to each member’s home. You may be approached by employees from other work groups when they hear of this proposal. So that you may communicate effectively, we’ve provided a summation of our rationale in advance of the more detailed explanation.

Principal Components

Pay Rates: 30.5 percent will restore our pay rates to those in effect prior to the pay cuts in 2003 adjusted for inflation (the calculations and methodology used to arrive at that number will be in the mailer). This equates to a 6.9 percent increase compounded annually since 2003. Contrast this with management’s effective 80 percent compound annual increases over the same period.

Annual Pay Raise: Your Board of Directors has chosen five percent to cover not only inflation, but the effects of long-term stagnation that our pilots have experienced in pay rates over the last decade.

Extended Pay Rates: Because contracts take a lot longer to negotiate than most of us would prefer, annual pay increases of six percent for each year after the amendable date of the next agreement are included to insulate the membership from a slow negotiating process.

Retroactivity: This is protection against a slower than necessary process in this negotiation.

Signing Bonus: Since 2003 our pilots have each lost, in aggregate, more than a year’s pay. This signing bonus is designed to return at least some measure of our investment, while most stakeholders (other than employees) have already realized returns representing multiples of their sacrifice.

Ancillary elements

New Hire Pay: For far too long, pilots have been required to essentially donate a year of their service before “real” pay begins in the second year. This proposal attempts to right this wrong in full anticipation that we will, indeed, be hiring again.

Pay Dates: Under our current contract, AMR gets free use of our accumulated wages for a period of 25 to 55 days every month. This proposal moves the time work is done and the the it is paid closer together.

Night Differential: Increase night differential pay from $5.00 to $6.50 for Captains and commensurately for First Officers, which is more in line with other airlines.

Premium Pay: Double time pay for holidays is consistent with pay practices in many companies. Management takes these days off with pay. This proposal rewards those who are needed to keep the airline operating on holidays.

International Override: This proposal moves AA more in line with other companies.

Per Diem: Self explanatory.
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Old 05-03-2007, 03:43 PM   #6  
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How about negotiating longevity for the furloughs if it is not already in place. Everything else looks Great.
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Old 05-03-2007, 03:58 PM   #7  
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Do not know about that, I know it has been discussed. I have personally sent a Sound Off regarding that as many others have as well. Hopefully that will be in the full details.

Best,

AA
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Old 05-03-2007, 04:17 PM   #8  
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More power to you AA guys!!! Let's hope the rest of the industry follows in your footsteps!
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Old 05-03-2007, 04:48 PM   #9  
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Even though I'm not now or will likely be AA I commend your team for asking for what you deserve. You certainly have my support and I hope this is contagious.
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Old 05-03-2007, 06:55 PM   #10  
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Quote:
Originally Posted by ClearLeft View Post
How about negotiating longevity for the furloughs if it is not already in place.
AMEN! Other stuff looks great, but the silence with respect to the furloughees is deafening.
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