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What's being done about the airline exec's?

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What's being done about the airline exec's?

Old 01-20-2006, 05:22 AM
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Default What's being done about the airline exec's?

I laugh when I hear crusty old pilots complain that the pilots of LCCs are the downfall of the profession and how LCCs are the downfall of the industry. As they complain about LCCs and their pilots their execs are laughing all the way to the bank! What is being done about these execs stealing company money right after pilots and other employees give back over a decades worth of contract negotiations? Where is the outrage and outcries over United, USAir, and American pulling the wool over the eyes of the courts? I've heard VERY little from ALPA and APA over these type of events!!! Why doesn't anyone stand up and "protect the profession". The airline execs must love hearing when we blame LCCs and their pilots as the reason we have to give back money.

United Airlines Wants Ethics Professor Out of Bankruptcy Court

Jan. 20, 2006 (The Denver Post) Could poor employee morale hurt United Airlines' bottom line as it tries to exit bankruptcy?

Maybe. Maybe not. But if United has its way, the issue won't come up in bankruptcy court this week as the company seeks confirmation of its reorganization plan.

United parent UAL Corp. has asked the court to exclude testimony from a business ethics professor who plans to testify that giving United executives millions of shares of new United stock could hurt morale.

University of Washington Business School professor Thomas M. Jones was retained as an expert witness by the Association of Flight Attendants at United. In a report to the court, he wrote, "Poor relations with employees will surely make the firm's economic recovery much more difficult than it would otherwise be." In another court filing, United counters, "Jones' views on business ethics and morality, as intellectually stimulating as they may be, have absolutely no bearing on whether United's plan of reorganization should be confirmed." But the motion was denied and Jones' testimony will be permitted, according to the flight attendants union.

United is the largest carrier at Denver International Airport and has more than 5,000 employees in Denver. It is targeting Feb. 1 as the date it will exit its three-year Chapter 11 bankruptcy.

United last week reached a critical agreement with the creditors committee on its reorganization plan. Remaining objections will be heard in bankruptcy court in Chicago starting today.

The company's latest incentive plan calls for 8 percent of new United stock, or 10 million shares, to be reserved for management equity incentives.

U.S. Bank National Association, Bank of New York and Wells Fargo Bank Northwest NA have asked the court to let them change their votes on the plan in light of the "last-minute agreement" between United and the creditors.
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Old 01-20-2006, 05:24 AM
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American Airlines CEO defends executive bonuses

DALLAS (AP) Bonuses for about 1,000 executives at American Airlines could be worth more than $70 million at the parent company's current stock price, and the airline's chief executive publicly defended the payments, which drew howls of protest from union leaders this month.
Executives with parent AMR still declined to put a dollar figure on the payments, but they said Wednesday that there are 2.2 million bonus units, valued much like shares of stock.

Each unit will be multiplied by 175% and then multiplied again by the stock price. The 175% multiplier will be used because AMR's stock rose more than other U.S. airline stocks from 2003 through the end of 2005.

On Wednesday, AMR shares closed at $18.71, and the average of high and low prices was $19.32. At that level, Executive Vice President Daniel P.
Garton's 44,000 units would be worth more than $1.5 million, and three other executives would get more than $1 million. The smallest payments, 50 units, would be about $1,700.

Those amounts have declined since the issue erupted into a major controversy at the Fort Worth-based carrier early this month because AMR's stock price has slipped, making each unit less valuable.

Chairman and Chief Executive Gerard Arpey, who did not take part in the current bonus program, said Wednesday that the payments are part of executives' compensation and are designed to base part of their pay on AMR's performance. He said that since 2001, those employees "have seen a substantial reduction in overall compensation" because stock-based payouts were low.

"The payments are much higher (this year) because our stock is much higher,"
Arpey said.

The payouts company officials don't use the term "bonuses" bloomed into a controversy early this month when the size of the largest payouts became apparent. They protested that the bonuses were poorly timed because AMR has lost more than $7 billion since the start of 2001.

Members of American's three unions narrowly approved $1.6 billion in annual pay cuts and other concessions in 2003, when the company was on the brink of bankruptcy. As part of the deal, the company gave them stock options that AMR estimated this month to be worth more than $568 million when they vest in April.

Officials for the unions did not immediately return calls for comment on Wednesday.
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Old 01-20-2006, 06:27 AM
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I think they are being punished with another pay raise.

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Old 01-20-2006, 09:45 AM
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Great another great pay out for the top 1% of Americans while the rest starve and suffer through pay cuts. What is the deal, why do all of us stand here and due nothing. Oh wait we did due something, we elected an adminstration that loves doing that themselves. Can we say haliburton!!!!!
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Old 01-20-2006, 10:19 AM
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I've heard VERY little from ALPA and APA over these type of events!!! Why doesn't anyone stand up and "protect the profession". The airline execs must love hearing when we blame LCCs and their pilots as the reason we have to give back money.[/QUOTE]

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ALPA (Duane Worthe's testimony on Capital Hill has raise this point many times) however ALPA can't stop this. Only the Shareholders can and they continue to allow it!. I can't fathom this but they do.

And just for clarification, the Corp Execs get these wonderful perks because they all have CONTRACTS!. Yeap they all have individual contracts that spell out these generous salaries and bonuses and other perks. Isn't it ironic that when a company is in Finacial disarray and employess are taking up the A##, the Corp execs get millions.......all financed by the give backs of the working man.
Is it right that these folks get 300-400% pay above all other company employees, especially when employees are giving back 30-50% in pay and benefits? Not in my opinion but my opinion doesn't count. As long as the Shareholders allow this, it will continue. Don't blame ALPA
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Old 01-20-2006, 10:28 AM
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Originally Posted by Fly4Beer
I laugh when I hear crusty old pilots complain that the pilots of LCCs are the downfall of the profession and how LCCs are the downfall of the industry.
So do you not think that work groups who work for considerably less money then their peers at other airlines don't have an impact on the industry? Come on now that's just silly talk and I'm not just talking about pilot pay either.

Here's a thought. If the LCCs do it so much better then the rest why can't they pay their employees the same amount. I have this discussion with one of my buddies and all he says is that we have to stay competitive. but I thought they did it so much better than the others and that's how they stayed competitive.

Since we are pilots let me mention this. 3rd yr CA pay at jetblue was about the same as 3rd yr FO pay at NWA, how does this not have a negative impact on the industry. CA pay alone just about covered the cost of both crew members at jetblue. How does the pay on the 190 compare to similar sized airplanes that were flown at the majors. ie. small DC-9/737. I'm betting that these things make a difference.

I don't think our negociators ever discussed what other airline CEO's made during contract negociations but they did mention what other pilots made quite a bit.

eric
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Old 01-20-2006, 10:54 AM
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[[COLOR="Blue"]Eric Stratton]So do you not think that work groups who work for considerably less money then their peers at other airlines don't have an impact on the industry? Come on now that's just silly talk and I'm not just talking about pilot pay either.


Good Post Eric.

For all those who disagree................ask yourself what you will do when MGT comes to you (and they will come) asks for pay and concessions when the next new Start up comes in with even a lower pay scale!

The dominos continue to fall.........What happens when JB becomes the highest paid (by default) Will the JB pilots be happy when Brand X start up pays their New 737 CAPTs $40/hr.

For the record, I am not picking on JB or it's pilots. I am just trying to make a point and continue what Eric Stratton point was.

Heck............look at Southwest. They are the highest paid Narrowbody Pilots of US carriers.........by default. It doesn't take a genius to predict what will happen to Southwest Pilot's pay after all the Legacy carriers finish Chainsawing their contracts and more and more start ups enter the market with low paying jobs.

Again...........I mean no disrepect to the Southwest Pilots. I truly hope they can hold on to their payscales and improve their retirement plan..............
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Old 01-20-2006, 03:07 PM
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Something to think about that Im sure has already been thought....

We talk about LCC pilots willing to work for so much less. But if you have no job and a family isnt a job be it a lower paying job still a job? If I am a trained pilot that couldnt find work or was furloughed from a legacy if I had a family you could put good money on my resume going out to everybody and anybody accpeting it. Anybody have any thoughts?
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Old 01-20-2006, 03:33 PM
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Depends.....................

Ask yourself whay most people wanted to become an Airline Pilot in the first place.

Love of Fying
Good Pay and Benefits
Potential of Time off with Family
All of the above.

For me it was Mostly Good pay and Benefits with the Time off.............or simply Put Quality of life. I got all the love of flying I needed in the USMC

When I was getting out of the Marines.............
If all I had to look forward to was making $55/hour as a Captain and working 18 days a month I would have chosen a diiferent career path.

Most young pilots who come from the civilian ranks (and some former Military) are willing to work slave wages as a CFI and then move on to slightly above slave wages to work Regional Airline (Formerly calle a Commuter)

The reason for this was................They were building their time and getting experience to some day work for the Big Airlines foramlly called the Legacy carriers.

Very similiar to an aspiring Professional Baseball player........out of College to playing for the Minors for a couple years..........Minors or AA players aren't paid worth a S#&T. They travel in Greyhound buses & stay in motel 6's.
Why do they put up with this? They pay their dues for a shot in the BIG leagues. That is how things were in the Airline industry......................................If things keep going the way they are, there won't be a BIG League Airline to Aspire to.

If I was a young pilot getting out of the Military now..................I would probably choose a different career path................but that is just me.
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Old 01-20-2006, 03:34 PM
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Depends.....................

Ask yourself whay most people wanted to become an Airline Pilot in the first place.

Love of Fying
Good Pay and Benefits
Potential of Time off with Family
All of the above.

For me it was Mostly Good pay and Benefits with the Time off.............or simply Put Quality of life. I got all the love of flying I needed in the USMC

When I was getting out of the Marines.............
If all I had to look forward to was making $55/hour as a Captain and working 18 days a month I would have chosen a diiferent career path.

Most young pilots who come from the civilian ranks (and some former Military) are willing to work slave wages as a CFI and then move on to slightly above slave wages to work Regional Airline (Formerly calle a Commuter)

The reason for this was................They were building their time and getting experience to some day work for the Big Airlines foramlly called the Legacy carriers.

Very similiar to an aspiring Professional Baseball player........out of College to playing for the Minors for a couple years..........Minors or AA players aren't paid worth a S#&T. They travel in Greyhound buses & stay in motel 6's.
Why do they put up with this? They pay their dues for a shot in the BIG leagues. That is how things were in the Airline industry......................................If things keep going the way they are, there won't be a BIG League Airline to Aspire to.

If I was a young pilot getting out of the Military now..................I would probably choose a different career path................but that is just me.
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