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Old 09-21-2010, 05:12 PM   #1  
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Default Airline Pilot pay justification

I can't take credit for this great explanation of pilot pay, I copied it from another site:

In M^%$ )(***l's post about his daughter's starting attorney pay there were many comments about the sad state of pilot pay. &^% made his point about us not negotiating in a vacuum - and it's fair enough. We all should know that pilot pay is but one component of the company's overall expenses and that achieving profitability is a complex goal for management. Nevertheless, I want to address another legitimate perspective on current and future pilot pay that deserves serious attention, namely the perspective gained by considering how much each passenger actually pays the pilots who safely fly them to their destinations. Shoot me down here - or agree - that this is a legitimate perspective we should be pushing more publicly. Whatever your response is if it's thoughtful I welcome it.

I fly captain on MD-88's and MD-90's. For argument purposes let's say my average seat count is 145 passengers. I'm sure somebody has the average load factor for these narrow body aircraft, but it looked pretty high to me in 2009. If it was 80%, then the average number of passengers on board an MD-88/90 was 116.

If every passenger with this load factor directly paid me $1.30/hour that would have covered my $150/hour 2009 wage. We have various employee benefits, and credit hours that are not directly productive, so ballpark we could probably agree $.70/hour more might cover those extra costs? So if the load factor is 80% and every passenger pays the captain $2/hour (and the FO $1.50/hour), then we're talking $3.50/hour going to both pilots of an MD88/90. Our legs probably average two hours.

We should all think about this for a few moments. Passengers pay hundreds, usually many hundreds of dollars per leg to fly on our jets. If my arithmetic is accurate it means passengers pay narrow body captains and their FO's about $7 total of their fare for a typical two hour flight - a very small percentage of their ticket cost. If this is true, how is it that a minimum cost of living pilot pay raise in any economic environment hasn't been demanded by DALPA and cannot be accommodated by management? How is it that the pay cuts we endured were not defended against in such visible and defensible terms? For management to pay both an MD-88/90 captain and the FO 116 more dollars/hour each - and again cover our credit hour costs and retirement benefits - all they'd have to do is directly pass on to passengers a $3.50/hour increase in the price of their ticket. $150, plus $116, would be $266/hour for MD-88/90 captains. And over $200/hour for FO's. Now we're beginning to talk real pay and DC retirement fund restoration.

More perspective. I tip the van driver two bucks if he takes me anywhere but to an airport hotel. I tip the Sky Cap a buck a bag to check my bags and family in at the curb - four bucks for about four minutes of his life. If every passenger tipped me a buck a minute - $120 for the two hour flight - times 116 passengers - that would be $13,920 for one flight. I don't expect anyone to tip, or pay, pilots like they might tip Sky Caps, but how about another $3.50/hour as eminently reasonable?

If polled, how many passengers would complain that paying a total of $10.50 instead of the current $7 they're paying to the two pilots for their two hour trip would be an unfair burden? How many of our passengers, the overwhelming majority of whom have a nice word to say to us upon deplaning, would say we don't deserve it? How many would be shocked to hear how little of their ticket price flows to us? I know the personal investment in our piloting skill sets we've all made - the under pressure training, flying experience, sound judgment - and our unique career terminating risks from loss of medical or FAA certificate action (not to mention being the continual focus of terrorist attack) - everything we bring to the air travel experience at Delta is worth far more to the passengers than they're currently paying directly to us. I'd like to see what they pay to pilots broken out on their ticket stub, just like taxes, fuel surcharges and whatever else is listed so they can know exactly what they're paying us. I believe most passengers would agree they could and should pay their pilots more. Especially when it would take such a small increase in a ticket's price going directly to pilots to offset the historically crushing effects of inflation combined with the recent successful attacks by managements in bankruptcy to gut pilot standards of living.

There was never not a time to publicly, loudly and longly make the it's a very small percentage of your ticket price argument to the world, but the time is especially ripe now to set the stage for truly restorative pay raises in the near future - with the abusive pay and work rules at the so-called regionals getting congressional scrutiny and media coverage and people widely appreciating split second life-saving performances of major airline pilots like Sully and Skiles.

As always during my 1* years here at D%^& I'm left wondering why this argument has never been made. It hasn't been made to us by our union in rallying support for a strike vote. Its never been made to my knowledge in the public arena. How does management get away with ever (ceo, president in bankruptcy court) saying we don't merit our pay? Or get away with saying they can't pay any more - not even a small 1-2 percentage increase in an average ticket price that could flow to pilots and quickly get us back to 1987 purchasing power wages? How come %ALPA - my labor union not just my schedule with safety association - never frames the argument in such simple, easy to fathom, dollars directly paid to pilots by passengers terms? Never slaps down demonstrably hollow management claims with simple arithmetic? How about a few full page ads in USA today informing the flying pubic how little they actually pay to their pilots when management again tells us we cost too much in 2012 and restoring the profession is out of the question?

The difference between a $100,000 annual raise for all %^ pilots (about the amount we each lost since 2004) and what we're making now is less than the price of two fancy cups of coffee many of our passengers think nothing of buying before boarding a &* airplane. That, my fellow pilots, is flat out amazing to me. Pilot pay as a percentage of ticket price should inform us, our management and the flying public as we move forward to a deservedly brighter future.
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Old 09-21-2010, 05:19 PM   #2  
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Hi Nerd,
If you're looking for anybody in this forum to disagree with you, you may be waiting a while....
chuck
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Old 09-21-2010, 05:23 PM   #3  
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Quote:
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Hi Nerd,
If you're looking for anybody in this forum to disagree with you, you may be waiting a while....
chuck
hey bud,

nope, I just want to open up the eyes of the blind,......and push for full contract restoration, with or without ALPA.
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Old 09-21-2010, 05:52 PM   #4  
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This is a great way to think of it. Thanks for the post.

The public often thinks of the year end total paid out- including payroll tax, benifits and hourly wages- and thinks X is fair for a pilot. But because most folks have know idea what a CEO, or CFO, etc, does... they figure the millions a CEO make is almost fair.

If the conversation was shaped in the terms of hourly pay per ticket per hour, it would be clear how poorly we are paid for our contribution to the bottom line.
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Old 09-21-2010, 05:55 PM   #5  
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I totally agree with you Nerd, but if you think of it from a greedy SOB management standpoint, $3.50 extra per ticket while moving say 50 million people per year is $175,000,000 that the airline could/would just pocket. So unless the flight attendants start passing around a jar, we won't ever see a penny.
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Old 09-21-2010, 06:29 PM   #6  
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Increased barriers to entry for the pilot profession are the answer. Requiring 1500 hours is a good start. We should push for higher standards and over time the pay will follow. The legal and medical professions have good barriers. What if getting an ATP were as difficult as passing the Bar exam or Med School boards?
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Old 09-21-2010, 06:35 PM   #7  
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Quote:
Originally Posted by Gunfighter View Post
Increased barriers to entry for the pilot profession are the answer. Requiring 1500 hours is a good start. We should push for higher standards and over time the pay will follow. The legal and medical professions have good barriers. What if getting an ATP were as difficult as passing the Bar exam or Med School boards?
Great idea and that is what many of those professional associations do. They limit the number of entrants.

The reasons that those two barriers are so hard is not just the test, but the predetermined number of applicants that are allowed to be certified. It is called limiting supply. It is something that we really should look at.
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Old 09-21-2010, 06:41 PM   #8  
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Those increased dollar amounts to pay for higher wages have been there for a long time. That extra cash is in the pockets of executive bonuses, stock options and salary.
This is standard in EVERY industry (my wife's job too). It's rich get richer, poor get poorer.
I agree we need to battle it out on the table. It shouldn't, but it takes striking to get back to where we were.
The above is a great explanation. But when we come up with great ideas like this, executives say "wow, great idea!..Thanks!" and puts that money in their own pockets.
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Old 09-22-2010, 01:25 AM   #9  
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Great post Nerd.

Somebody brought up the seniority-based pay scales, and the ingrained "pay-your-dues" system that's plaguing the airline industry. I will also say that the problem isn't the management. The problem is the collective mentality of airline pilots in the US.

After my airline collapsed (Aloha), many of us lost everything. Nerd, imagine yourself right now, you are an experienced captain making a solid living, but due to really poor management, you find your airline collapsing and now you no longer have a job. OK, it happens to the best of us, you say. I will go and find another job. But unlike most other "professionals", you, despite most likely decades of experience in the cockpit, years as a captain making decisions, are limited to making less than $3000/month again, and that's if you're 'fortunate' enough to get hired an outfit like say Allegiant or JetBlue.

"It's not fair to have anyone off-the-street or some 'brown noser' bypass me (in terms of pay, seat, etc.) - I was here first" is the argument you'll hear from the people in any airline.

What also fosters the above argument is are the tiered payscales. Everyone rightfully wants to protect theirs. So as a result, if, God-forbid, your airline goes out of business, and you're young and 'fortunate' enough to get hired by another airline, remember, your experience, your time in the industry, your previous compensation do not matter one iota. You are still sentenced to under $3000/month.

... and what's even more shocking is that the pilot population accepts that as normal.

Do airline managers 'lose' all their years of experience when it comes to their compensation? Maybe their 'loss' is about equal to the percentage of pilots' pay cuts as parts of concessions.

The management sees this as a way to keep your wages low simply because you will have to start over somewhere else, and to many, it might be financially impossible. Just think in terms of concessions you've given over the last decade, still better than losing your seniority-protected pay, right? In the meanwhile, look at the airline executive compensation and bonuses while you were taking pay cuts and losing your pension.

Sadly, US pilot population accepts this as normal, and as long as that mentality persists among the pilot ranks, you will not exact any changes.

As a result of this, many of my former airline colleagues took jobs flying for overseas airlines where there is no 'seniority system' like in the US, where you are paid as a professional from day 1 as opposed to 10 years from now.

Unfortunately, in the US, I don't see the pilot compensation system changing without radical changes in pilots' collective way of thinking, and sadly, I think it's highly unlikely.
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Old 09-22-2010, 02:08 AM   #10  
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Quote:
Originally Posted by acl65pilot View Post
Great idea and that is what many of those professional associations do. They limit the number of entrants.

The reasons that those two barriers are so hard is not just the test, but the predetermined number of applicants that are allowed to be certified. It is called limiting supply. It is something that we really should look at.
I've always thought that if people believe we should limit the number of pilots that they should be the first one limited. I'm sure their mind would change.
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