Example how ALPA nation is not on your side
09-16-2013, 03:46 PM
#1
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Joined APC: Nov 2010
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Posts: 2,101
Example how ALPA nation is not on your side
Fellow Pilot,
On September 6, you received a letter from your former MEC Chairman on his final day in office as the EGL MEC Chairman. His letter expressed many concerns, but focused most on recent negotiations at PSA and on ALPA’s response to your company requests for concessions.
I will not respond to his letter point-by-point; however, I feel that it is important for you to understand the Association’s perspective with regards to the future of the regional industry.
It is my belief that our approach should be to always deliberately discuss and understand the world we live in, carefully weigh all the facts and alternatives, and respond thoughtfully and without emotion to ensure that we protect existing work and build career paths for the future of our members.
Today, the Fee-For-Departure (FFD) pilots and their companies are facing intense industry pressure similar to that faced by legacy pilots in the last decade following 9/11. The external factors present during that period resulted in downward modification to collective bargaining agreements. Mainline contracts are returning more closely to an appropriate standard for pay, benefits, work rules and job security provisions.
Prolonged economic downturn, consolidation, high fuel prices, and an increased focus on capacity discipline has led mainlines to constrain affiliate capacity, focus on larger more fuel efficient jets, and reduce the overall costs they pay to FFD carriers. This includes an increased focus on FFD pilot block hour costs. With stagnation in the industry increasing longevity costs at some carriers, there is a wide disparity in pilot block hour costs.
The economic factors listed above, along with an increase to the regulated retirement age, have limited career growth opportunities as well as slowed hiring. This resulted in increased longevity among FFD pilots during the past 10 years. At some airlines — Eagle and Endeavor (formerly Pinnacle), for example — higher average longevity has been one of the biggest cost drivers in those contracts. Pilot longevity also played a huge role in making Comair financially uncompetitive.
While actual Year 15 rates between two carriers may only be as little as 2% apart, one carrier will have much higher average longevity than the other and this longevity component can raise pilot block hour costs from approximately $275 to $350 per hour.
Consider these current realities:
· Mainline carriers are now re-equipping their FFD affiliates where large capital expenditures are needed.
· We are in a bargaining cycle where overcapacity exists and mainline airlines have choices over where to allocate this flying.
· Mainline carriers don't need our help to achieve lower block hour costs; they can achieve this simply by using existing lower cost partners to do the flying.
I’m confident that consolidation at FFD carriers, an improving economic picture, and more fuel efficient and larger jets will improve our negotiating leverage in the next few years. We will again be in a stronger bargaining position in the near future, just like at mainline carriers and like the robust and favorable bargaining during FFD negotiations between 1999 and 2004.
Normal turnover, increased hiring at mainline carriers as a result of increased number of retirements, and new hiring at the regional level, will eventually lower longevity costs. But what do we do in the meantime? We have tough choices to make about how to protect our members’ work at existing carriers, and where necessary, to provide soft landings for pilots at FFD carriers that may not survive rather than force fellow pilots to start over at the bottom of someone else’s seniority list. We also need to continue to pressure the brands to take more responsibility for their affiliates as well.
ALPA pilots have never been afraid of tough choices or hard work to protect our profession. We discuss the issues, weigh the pros and cons, and make decisions that are deliberate and thoughtful rather than emotional.
FFD carrier representatives gathered a few weeks ago and again last week to discuss these issues, and they'll meet again in November to make collective decisions. As always, they will have the support of my office and the Association’s resources to carry out their mission.
***This was sent from the ALPA President to the AE pilot*******
On September 6, you received a letter from your former MEC Chairman on his final day in office as the EGL MEC Chairman. His letter expressed many concerns, but focused most on recent negotiations at PSA and on ALPA’s response to your company requests for concessions.
I will not respond to his letter point-by-point; however, I feel that it is important for you to understand the Association’s perspective with regards to the future of the regional industry.
It is my belief that our approach should be to always deliberately discuss and understand the world we live in, carefully weigh all the facts and alternatives, and respond thoughtfully and without emotion to ensure that we protect existing work and build career paths for the future of our members.
Today, the Fee-For-Departure (FFD) pilots and their companies are facing intense industry pressure similar to that faced by legacy pilots in the last decade following 9/11. The external factors present during that period resulted in downward modification to collective bargaining agreements. Mainline contracts are returning more closely to an appropriate standard for pay, benefits, work rules and job security provisions.
Prolonged economic downturn, consolidation, high fuel prices, and an increased focus on capacity discipline has led mainlines to constrain affiliate capacity, focus on larger more fuel efficient jets, and reduce the overall costs they pay to FFD carriers. This includes an increased focus on FFD pilot block hour costs. With stagnation in the industry increasing longevity costs at some carriers, there is a wide disparity in pilot block hour costs.
The economic factors listed above, along with an increase to the regulated retirement age, have limited career growth opportunities as well as slowed hiring. This resulted in increased longevity among FFD pilots during the past 10 years. At some airlines — Eagle and Endeavor (formerly Pinnacle), for example — higher average longevity has been one of the biggest cost drivers in those contracts. Pilot longevity also played a huge role in making Comair financially uncompetitive.
While actual Year 15 rates between two carriers may only be as little as 2% apart, one carrier will have much higher average longevity than the other and this longevity component can raise pilot block hour costs from approximately $275 to $350 per hour.
Consider these current realities:
· Mainline carriers are now re-equipping their FFD affiliates where large capital expenditures are needed.
· We are in a bargaining cycle where overcapacity exists and mainline airlines have choices over where to allocate this flying.
· Mainline carriers don't need our help to achieve lower block hour costs; they can achieve this simply by using existing lower cost partners to do the flying.
I’m confident that consolidation at FFD carriers, an improving economic picture, and more fuel efficient and larger jets will improve our negotiating leverage in the next few years. We will again be in a stronger bargaining position in the near future, just like at mainline carriers and like the robust and favorable bargaining during FFD negotiations between 1999 and 2004.
Normal turnover, increased hiring at mainline carriers as a result of increased number of retirements, and new hiring at the regional level, will eventually lower longevity costs. But what do we do in the meantime? We have tough choices to make about how to protect our members’ work at existing carriers, and where necessary, to provide soft landings for pilots at FFD carriers that may not survive rather than force fellow pilots to start over at the bottom of someone else’s seniority list. We also need to continue to pressure the brands to take more responsibility for their affiliates as well.
ALPA pilots have never been afraid of tough choices or hard work to protect our profession. We discuss the issues, weigh the pros and cons, and make decisions that are deliberate and thoughtful rather than emotional.
FFD carrier representatives gathered a few weeks ago and again last week to discuss these issues, and they'll meet again in November to make collective decisions. As always, they will have the support of my office and the Association’s resources to carry out their mission.
***This was sent from the ALPA President to the AE pilot*******
09-16-2013, 06:06 PM
#3
Gets Weekends Off
Joined APC: Jul 2011
Posts: 894
The letter Moak is referencing :
Fellow American Eagle pilots,
This is another disappointing week. We have now read the tentative agreement that PSA has reached with their management and with US Airways management and it is ugly. Here are a few lowlights. First and most significantly, it limits their Captain pay scales to year twelve and limits their First Officer pay scales to year four. In addition, this TA will extend their existing contract for an additional five years, until 2023 with no interim contract amendments. It limits their per diem to $1.75 for the duration of the agreement and the only pay raises PSA pilots will see for a decade will be the annual cost of living calculation that is already in their contract. By year three, the deal also raises their pilot medical benefit contribution from 27% to 35% of the annual cost with no language on deductibles and co-pays.
In exchange for these concessions, the PSA pilots might receive 30 of American Airlines’ future CRJ-900 aircraft (assuming the AA/US Airways merger occurs). Amazingly, it appears that the company is only contractually required to place one of these aircraft into service at PSA by 2016 in order to fulfill its obligation and to make this new agreement binding on the pilot group. On the other hand, if ratified, pilot concessions begin this January. These 30 aircraft are for American feed and are part of the same aircraft order over which we were negotiating with US Airways.
The PSA pilots will also receive an “enhancement” to their current guaranteed interview at US Airways. Interviews will be offered to PSA pilots in PSA seniority order but US Airways is under no obligation to offer employment to any particular PSA pilot. A pilot who does not receive an offer of employment from US Airways can interview again but if he is declined again, his longevity at PSA is immediately frozen for the remainder of his career. The “enhancement” to the guaranteed interview provision is that US Airways must hire four per month, rather than three PSA pilots. It also appears however, there are multiple scenarios where US Airways can determine they have met that obligation without actually hiring anyone.
This tentative agreement represents the direction the American Eagle MEC was unwilling to go. As you know, your MEC has been committed to finding an agreement that does not gut the regional industry only to further the careers of senior Eagle pilots at the expense of everyone that will follow us. The MEC could not have been clearer on this position when it elected to end negotiations with US Airways and pushed for all of the ALPA-represented regional carriers to sign the “No B-Scale” letter. Although, this PSA deal does not contain a “B Scale” it is a massive step backwards for existing and future regional pilots.
If ratified, this new paradigm will be used against our brothers and sisters at ASA/ExpressJet, Republic, and SkyWest, all of whom are currently in challenging negotiations, not to mention it being used against us when management returns for additional discussions on future aircraft. Along with the Pinnacle (Endeavor Air) bankruptcy contract, the new PSA agreement will become management’s new “target”.
There are additional distasteful elements to this TA, not the least of which is the fact that this negotiation is over future AA feed at the exact time that the Department of Justice is opposing the merger of AA and US Airways. AA made it overwhelmingly clear that “large” RJs were an essential component of their restructuring plan, whether merged or stand alone. Now, AA’s future feed has been promised to a pilot group who will have to wait an indeterminate period of time to see if the merger will ever be approved, which is a precursor to AA’s regional aircraft being placed at PSA. During that delay, these essential aircraft will be withheld from AA’s feed operation, where it is already significantly behind its competition in “large” RJ deployment. This further confirms our position that AA needs to order large regional aircraft now and place them at American Eagle, the only constant irrespective of the mainline merger.
Additionally, by removing all Captain pay scales above step twelve, PSA’s tentative agreement eviscerates all the gains made over the last twelve years focused on making regional airlines a viable career choice for experienced pilots.
Both American and US Airways’ managements clearly know that withholding replacement aircraft from American Eagle works in opposition to cost savings elements that management committed to, making it more challenging for Eagle to compete.
Lastly, we are stunned by the lack of resistance exhibited from ALPA’s national officers, with the sole exception of Vice President of Administration and Eagle Captain Bill . Our National Leadership has not led the way in this effort to “Stop the Whipsaw”.
With months to go until new flight time and duty time regulations that will result in a five-to-ten percent increase in pilot staffing to cover existing schedules, and despite months of regional airlines missing hiring targets industry-wide, it is absurd that our national leadership has not supported the outcry from regional MECs to collectively set a higher bar and simply say, “no” to this last ditch effort by US Airways’ management to drive this industry into compensation models from twenty years ago when we were piloting Metroliners, rather than aircraft significantly larger and more complex that what used to be entry-level aircraft at mainlines.
We all know that airlines need to compete based on costs. Eagle, as well as other MECs, have proven time and time again a willingness to work with management in a mutually agreeable way to rein in costs and find better and cheaper ways to do business. But it is one thing to decide to place aircraft at an airline because they are cheaper, it is another for an already inexpensive pilot group to voluntarily accept decade-long concessions to facilitate it. We hope the PSA pilots will realize that the race to the bottom simply is not worth the carrot and that ALPA’s national officers will ultimately agree that regional pilot jobs are worth protecting with the same vigor as mainline jobs. There will be another meeting next week with all the MEC Chairmen and I am confident your new MEC Chairman will carry this message.
I cannot describe how disconcerting it is that this is the last hotline I will likely send to you. Nonetheless, I would be remiss if I closed without stating that I am proud of the Eagle MEC. Along with tremendous pilot support, we have weathered the proposed divestiture of American Eagle, the AMR bankruptcy, and a vicious negotiation with another company’s management, which as of now, has resulted in a bleak future for American Eagle employees. Despite record profits and a healthy parent company, ready to exit bankruptcy except for the current DOJ dispute, the $43 million that the American Eagle pilots conceded under a mutually agreeable negotiation is apparently not enough to satisfy management’s need to achieve “cheaper” labor before it can feel that it has wrestled enough from the expert workers who actually perform the job being purchased by our customers.
It has been a great honor to serve you in this capacity and I look forward to continuing this battle alongside you on the flight deck.
Fraternally, TG
Fellow American Eagle pilots,
This is another disappointing week. We have now read the tentative agreement that PSA has reached with their management and with US Airways management and it is ugly. Here are a few lowlights. First and most significantly, it limits their Captain pay scales to year twelve and limits their First Officer pay scales to year four. In addition, this TA will extend their existing contract for an additional five years, until 2023 with no interim contract amendments. It limits their per diem to $1.75 for the duration of the agreement and the only pay raises PSA pilots will see for a decade will be the annual cost of living calculation that is already in their contract. By year three, the deal also raises their pilot medical benefit contribution from 27% to 35% of the annual cost with no language on deductibles and co-pays.
In exchange for these concessions, the PSA pilots might receive 30 of American Airlines’ future CRJ-900 aircraft (assuming the AA/US Airways merger occurs). Amazingly, it appears that the company is only contractually required to place one of these aircraft into service at PSA by 2016 in order to fulfill its obligation and to make this new agreement binding on the pilot group. On the other hand, if ratified, pilot concessions begin this January. These 30 aircraft are for American feed and are part of the same aircraft order over which we were negotiating with US Airways.
The PSA pilots will also receive an “enhancement” to their current guaranteed interview at US Airways. Interviews will be offered to PSA pilots in PSA seniority order but US Airways is under no obligation to offer employment to any particular PSA pilot. A pilot who does not receive an offer of employment from US Airways can interview again but if he is declined again, his longevity at PSA is immediately frozen for the remainder of his career. The “enhancement” to the guaranteed interview provision is that US Airways must hire four per month, rather than three PSA pilots. It also appears however, there are multiple scenarios where US Airways can determine they have met that obligation without actually hiring anyone.
This tentative agreement represents the direction the American Eagle MEC was unwilling to go. As you know, your MEC has been committed to finding an agreement that does not gut the regional industry only to further the careers of senior Eagle pilots at the expense of everyone that will follow us. The MEC could not have been clearer on this position when it elected to end negotiations with US Airways and pushed for all of the ALPA-represented regional carriers to sign the “No B-Scale” letter. Although, this PSA deal does not contain a “B Scale” it is a massive step backwards for existing and future regional pilots.
If ratified, this new paradigm will be used against our brothers and sisters at ASA/ExpressJet, Republic, and SkyWest, all of whom are currently in challenging negotiations, not to mention it being used against us when management returns for additional discussions on future aircraft. Along with the Pinnacle (Endeavor Air) bankruptcy contract, the new PSA agreement will become management’s new “target”.
There are additional distasteful elements to this TA, not the least of which is the fact that this negotiation is over future AA feed at the exact time that the Department of Justice is opposing the merger of AA and US Airways. AA made it overwhelmingly clear that “large” RJs were an essential component of their restructuring plan, whether merged or stand alone. Now, AA’s future feed has been promised to a pilot group who will have to wait an indeterminate period of time to see if the merger will ever be approved, which is a precursor to AA’s regional aircraft being placed at PSA. During that delay, these essential aircraft will be withheld from AA’s feed operation, where it is already significantly behind its competition in “large” RJ deployment. This further confirms our position that AA needs to order large regional aircraft now and place them at American Eagle, the only constant irrespective of the mainline merger.
Additionally, by removing all Captain pay scales above step twelve, PSA’s tentative agreement eviscerates all the gains made over the last twelve years focused on making regional airlines a viable career choice for experienced pilots.
Both American and US Airways’ managements clearly know that withholding replacement aircraft from American Eagle works in opposition to cost savings elements that management committed to, making it more challenging for Eagle to compete.
Lastly, we are stunned by the lack of resistance exhibited from ALPA’s national officers, with the sole exception of Vice President of Administration and Eagle Captain Bill . Our National Leadership has not led the way in this effort to “Stop the Whipsaw”.
With months to go until new flight time and duty time regulations that will result in a five-to-ten percent increase in pilot staffing to cover existing schedules, and despite months of regional airlines missing hiring targets industry-wide, it is absurd that our national leadership has not supported the outcry from regional MECs to collectively set a higher bar and simply say, “no” to this last ditch effort by US Airways’ management to drive this industry into compensation models from twenty years ago when we were piloting Metroliners, rather than aircraft significantly larger and more complex that what used to be entry-level aircraft at mainlines.
We all know that airlines need to compete based on costs. Eagle, as well as other MECs, have proven time and time again a willingness to work with management in a mutually agreeable way to rein in costs and find better and cheaper ways to do business. But it is one thing to decide to place aircraft at an airline because they are cheaper, it is another for an already inexpensive pilot group to voluntarily accept decade-long concessions to facilitate it. We hope the PSA pilots will realize that the race to the bottom simply is not worth the carrot and that ALPA’s national officers will ultimately agree that regional pilot jobs are worth protecting with the same vigor as mainline jobs. There will be another meeting next week with all the MEC Chairmen and I am confident your new MEC Chairman will carry this message.
I cannot describe how disconcerting it is that this is the last hotline I will likely send to you. Nonetheless, I would be remiss if I closed without stating that I am proud of the Eagle MEC. Along with tremendous pilot support, we have weathered the proposed divestiture of American Eagle, the AMR bankruptcy, and a vicious negotiation with another company’s management, which as of now, has resulted in a bleak future for American Eagle employees. Despite record profits and a healthy parent company, ready to exit bankruptcy except for the current DOJ dispute, the $43 million that the American Eagle pilots conceded under a mutually agreeable negotiation is apparently not enough to satisfy management’s need to achieve “cheaper” labor before it can feel that it has wrestled enough from the expert workers who actually perform the job being purchased by our customers.
It has been a great honor to serve you in this capacity and I look forward to continuing this battle alongside you on the flight deck.
Fraternally, TG
09-16-2013, 10:20 PM
#6
Gets Weekends Off
Joined APC: Nov 2008
Position: 717 Sidekick
Posts: 162
Originally Posted by What
Fellow Pilot,
Prolonged economic downturn, consolidation, high fuel prices, and an increased focus on capacity discipline has led mainlines to constrain affiliate capacity, focus on larger more fuel efficient jets, and reduce the overall costs they pay to FFD carriers. This includes an increased focus on FFD pilot block hour costs. With stagnation in the industry increasing longevity costs at some carriers, there is a wide disparity in pilot block hour costs.
The economic factors listed above, along with an increase to the regulated retirement age, have limited career growth opportunities as well as slowed hiring. This resulted in increased longevity among FFD pilots during the past 10 years. At some airlines — Eagle and Endeavor (formerly Pinnacle), for example — higher average longevity has been one of the biggest cost drivers in those contracts. Pilot longevity also played a huge role in making Comair financially uncompetitive.
Prolonged economic downturn, consolidation, high fuel prices, and an increased focus on capacity discipline has led mainlines to constrain affiliate capacity, focus on larger more fuel efficient jets, and reduce the overall costs they pay to FFD carriers. This includes an increased focus on FFD pilot block hour costs. With stagnation in the industry increasing longevity costs at some carriers, there is a wide disparity in pilot block hour costs.
The economic factors listed above, along with an increase to the regulated retirement age, have limited career growth opportunities as well as slowed hiring. This resulted in increased longevity among FFD pilots during the past 10 years. At some airlines — Eagle and Endeavor (formerly Pinnacle), for example — higher average longevity has been one of the biggest cost drivers in those contracts. Pilot longevity also played a huge role in making Comair financially uncompetitive.
2013 Q2 Earnings:
AMR
In the second quarter of 2013, GAAP net profit was $220 million, a $461 million
improvement compared to the prior-year period. Excluding reorganization and special
items, second quarter 2013 net profit was $357 million, a $262 million improvement
compared to the prior-year period. This record setting quarterly result was bolstered by a
June during which the company recorded its best monthly profit, excluding
reorganization and special items, in its history.
US Airways Group
"So if you adjust for that and look at the pre-tax number and look at pretax, excluding special items, what you will see is we had a record $409 million pretax profit for the quarter. We're extremely pleased with that."
SkyWest Inc
St. George, Utah—SkyWest, Inc. (“SkyWest”) (NASDAQ: SKYW) today reported net income
of $20.7 million, or $0.39 per diluted share, for the quarter ended June 30, 2013, compared to net
income of $17.0 million, or $0.33 per diluted share, for the same period last year
United Continental Holdings:
United Airlines (UAL) today reported second-quarter 2013 net income of $521 million, or $1.35 per diluted share, excluding $52 million of special charges. Including special charges, UAL reported second-quarter 2013 net income of $469 million, an increase of 38 percent year-over-year, or $1.21 per diluted share.
Delta Air Lines Inc
"Richard H. Anderson - CEO: Thank you. Good morning, everyone. We reported an $840 million pre-tax profit for the June quarter. We increased our earnings year-on-year by $255 million, grew passenger revenue by $63 million year-on-year, expanded our pre-tax margin by 2.6 points to 8.7%, generated operating cash flow of $1.3 billion and earned $0.98 per share, beating First Call consensus of $0.95 per share. "
Republic Airways Holding:
"Republic Airways Holdings Inc. (RJET) today reported diluted earnings per share of $0.46, which is a 15.0% increase from the $0.40 per diluted share result in the second quarter of 2012. Net income increased 23.0% to $24.6 million for the quarter ended June 30, 2013, compared to net income of $20.0 million for the same period last year."
How is it that every airline that any of us work for is profitable and they need us to give up money?? I'm not an economics major and maybe this is too simple of an argument but it sure doesn't seem that times are so hard for the people that write our pay checks. I am wavering on being pro union here at SkyWest but ALPA seems like a joke. I hope everyone votes no to concessions so we can get a piece of these profits...or at least not take a cut. I hope PSA holds stong! Love the STW movement and proud of Eagle for what they did! I'll be the first to vote no here at SkyWest if they ask for us to give up anything.
09-17-2013, 03:07 AM
#8
Gets Weekends Off
Joined APC: Mar 2010
Posts: 1,951
Moak is the biggest scumball ever to head ALPA. He needs to go get a spray tan with Roger Cohen. He isn't even subtle about his desire to destroy the regionals and put regional pilots out of work. But keep taking my 2% at gunpoint.
09-17-2013, 04:16 AM
#9
Banned
Joined APC: Jan 2006
Position: A-320
Posts: 6,929
Originally Posted by Captain Tony
Moak is the biggest scumball ever to head ALPA. He needs to go get a spray tan with Roger Cohen. He isn't even subtle about his desire to destroy the regionals and put regional pilots out of work. But keep taking my 2% at gunpoint.
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