The fundamental problem with any tinkering to a seniority system is that you always have the guys at the very top who would be negatively impacted by any sort of benefits / compensation flattening. They have a strong incentive to stonewall any effort to take away the benefits they enjoy, especially when they had to endure being at the bottom of the seniority list to get there.

 

That's true, but only at mainline. Any flattening at the regional level would tend to flatten out toward the high end leaving captain pay pretty much where it is...or even push it up a bit.

Pushing ALPA out of the regionals and getting rid of seniority would be a management nightmare which is why it would be a tough sell. Management (both mainline and regional) depends on ALPA and their BS to sell the business model to pilots and keep them brainwashed.

If becoming a captain at a regional was a good long term job the mainlines would be forced to lower their hiring standards to try to recruit regional first officers or even compete directly with regionals for the best entry level pilots.

The regionals would save a ton of money in training and recruiting costs.

Bottom line is the regionals can do this and still remain profitable but they will only do it if they are forced to do it. The fact that it's more and more difficult to recruit exclusively at the bottom end may force their hand...or they may just throw in the towel.

 

The issue with regional airlines raising pay for pilots to levels "commiserate with experience" is this pesky issue of revenue.

Regional airlines operating under a fee-for-departure agreement are like a retiree on social security: their revenue is fixed. As such, when costs go up, profit drops. Costs go up enough and profit disappears, and the company ceases as a going concern.

Legacy airlines have negotiated EXTREMELY tight capacity lift agreements with their regional partners, such that regional margins are exceedingly low, WELL below what the average pilot expects their 401k return to be. As such, in many cases even if regional airline management wanted to pay going market wages per the labor supply/demand graph, they simply can't.

Of course, mainline partners could simply pay them more to cover the additional costs of this...but they won't.

Problems are never quite as simple as they seem, nor their solutions quite as easy...

 

You're absolutely right.

They'd have to be grandfathered, no other way. So this sort of reform can only be pulled off in the best of times, when pilots have leverage and airlines can afford it.

 

In a more simplified way. Perhaps something very much like this:

1) Pay rates should continue to be partially based on equipment size and seat type, as with today. In other words, a senior WB captain should make more than a NB captain, and so on.

2) Longevity should continue to affect pay to a certain degree. However, I would redefine the word 'longevity' as it relates to pay. Pay longevity shouldn't be based on your time at your current airline, but rather your overall commercial flying experience. There's no reason that a 20-year captain should suddenly have to go back to first-year FO wages just because that captain's airline furloughs or goes bankrupts. That's tremendously unfair to the senior guys.

So for example, your total 121/135 experience could factor into your pay. Changing airlines should not slash your pay back to 1st-year FO levels.

3) Airlines can and should be able to hire DEC's. If you've got 4000 hrs PIC in a 737, and your airline furloughs, why should you be forced to go back to 1st-year FO pay and the right seat on another airline? Let's pay people for what truly matters: their experience. Let's value that experience accordingly. That's how it's done in nearly every other industry.

4) By far the most important: your pay clock should start at the moment you report for duty, and stop when you are released. Whether you are preflighting, waiting for a reflow, flying the airplane, or deadheading...doesn't matter. It should all be paid at the same rate. So if scheduling gives me a 8-hour duty day that involves 4 hours of flying, and delays/ cancels/ reflows result in a 14-hour duty day with 1 hour of flying, I'm getting paid 14 hours. Period. Because the company is requiring me to be in airport X or on airplane Y. They are using my time, and I expect to be compensated for every minute I'm on the clock.

5) As others have stated, the current system of seniority as it affects equipment selection, base selection, and line/reserve flying should probably stay as is. But not for pay (see above).

The benefits of this system would be:

•*Senior guys won't have to suffer the indignity of a dramatic pay cut when their airline furloughs (and you know it's going to happen again when this latest economic bubble collapses. It's a virtual guarantee.) This whole 'start over at the bottom of your next airline' system only benefits one player: the airlines. I don't see how it benefits a single pilot.

• All of us will be paid for all of the time we are required to be at work.

• Airlines will be incentivized to construct the most efficient schedules possible.

What are the negatives?

•*You may have a situation where two captains on the same airline and the same equipment are getting paid significantly different rates. For example, Captain Bob has been with his airline for 15 years, has 10,000 hours of commercial flight time, and makes $200/hr. (I'm just making up numbers, so bear with me.) But Captain Pete has been with the same airline for only 1 year. He, however, has 30 years and 25,000 hours of commercial flight time, since he was just furloughed last year. However, in my system, Captain Pete would be making a higher hourly rate than Captain Bob. This would irritate Cap'n Bob. However, it's how virtually every other industry pays people – according to experience.

•*If airlines hire DECs, you'll have situations where if Airline A furloughs and Airline B hires a bunch of DECs, Airline B's senior FOs will now have their much-hoped-for upgrades delayed, because a bunch of CA slots just got filled. Again, though, that's how it works in every corporate (non-aviation) job out there. Sometimes people get hired in from the outside into positions that are senior to you, instead of you getting promoted. The usual remedy? Take your experience and use it to get a promotion at another company. Same would apply in the airlines. So in this case, if I'm a senior FO at Airline B, and a bunch of DEC's get brought in above me, I take my 10,000 hours of turbine time and go get a DEC job at Airline C.

So there's my idea. Not that it will ever be implemented. But I'd love to see folks comment on the positives and negatives of such a system...

 

This is completely and totally untrue. Considering all their [the regionals'] agreements are negotiated by the very entities that either own them or depend on them. The actual negotiations are for the sole purpose of making money for the managers and providing a low cost contracted source of outsourced labor for mainline carriers. Profits are completely irrelevant except as necessary to keep the business running.

Which is exactly what I just said in response to your first two paragraphs. You are just trying to explain it in reverse rather than for what it is.

They will pay them whatever they need to pay them until they no longer save money for mainline at which point they will do the flying themselves...again.

It is actually much simpler than you would like the line pilots to believe.

 

The only thing you can grandfather in is pay and bidding seniority and only at the top level. Once you start hiring pilots into more senior positions at higher pay it won't matter anymore because those senior pilots who have already been there a long time will be competitive in their own right.

They may resent the changes for personal reasons that have nothing to do with pay but that's their problem...they'll get over it.

Change is always disruptive and can never please everyone. It's about creating change that benefits the whole and allows regionals to survive and for pilots to earn more money at lower costs to the airlines.

 

For publicly traded companies (SKW and RJET come to mind) profits are quite rather important to shareholders. Without profit there is no return, without return there is no investor capital, without investor capital there is no going concern.

For privately traded companies (TSH, AWAC) things get murkier due to a lack of SEC filings but the profit motive is the same, and for wholly-owned carriers the regionals can look as good or as bad on a spreadsheet as Mother wants them to.

Thank God we all have you to tell us we're wrong and to spell it out for us the "right" way.

Agree...but you're not going to see 50, 70 or even 76 seat jets at mainline. While total numbers of "small jets" may shrink due to shifting economics, SOMEBODY is going to fly those airframes as the need for such airframes in a network isn't going to go away.

The simple solution is MOAR MONEY, but the reason MOAR MONEY isn't there requires a tad bit of consideration.

 

The other day there was a comment by a major airline CEO (can't remember who) who was asked, "Now that fuel prices have plummeted, are you going to pass along those savings to customers?" His answer, of course, was 'He** no." (Not in those exact words.)

As others have stated, regional airlines exist purely to provide a C scale of pay for the majors who either own them or contract them out. In my industry (advertising and design), there's a similar thing...it's called outsourcing tech development (and sometimes Photoshop work) to Southeast Asia, South Asia, and Eastern Europe. The reason we don't do it often is that the quality is usually terrible; you get what you pay for. So we pay much higher rates to attract top-level talent. If we didn't, our product would suffer.

The majors, however, don't suffer from the same lack of product quality when they hire pilots at $24/hr to drive 76-seat jets around. Flights don't suddenly become more dangerous or more turbulent or less reliable just because they are flown by pilots who are paid a fraction of what mainline pilots are paid. So, the majors have no incentive - zero – to change this situation.

I'm sure that if Jeff Smisek and his fellow CEOs could get their pilot unions to agree, they'd outsource 777s to their regional partners. And you know there'd be people lining up to fly them for $24/hr.

In terms of classical economic theory, economic models always assume that actors in a marketplace 1) have perfect information, and 2) act completely rationally. #1 never used to be remotely possible, although the Internet has now made pilot-pay-related information vastly more accessible and universal. However, number 2 is the Achilles heel for all of us pilots. As pilots, we are not rational actors. We are clearly quite willing to invest many tens of thousands of dollars and years of our lives training for an occupation that will make it extremely difficult for us to recoup that investment in a reasonable timeframe.

Why? Because we love to fly. We love to fly in a way that no accountant loves to prepare tax filings. We love to fly in a way that no corporate lawyer loves to prepare 500-page court filings. It is this emotion that makes the entire airline industry possible. Without it, there would be no C scale. There would be no B scale. There'd only be an A scale.

But as the love for flight is unlikely to be erased from the human psyche anytime soon (until the day fully-autonomous airliners are created), the current situation is unlikely to change.

And to bring it all back to my first point: Regardless of all the rules, and seniority, and double-time pay and deadhead pay and soft pay and hard pay and user pay and Lord knows what else...I believe pilots should be paid from the time they report for duty until the time they are released. That is all I am really saying. Everything else can follow from that.

 

I would just add that last point in that equipment and base selection should be on an availability basis...no more forced displacements by senior guys and no more entitlement bidding so guys spend more time in training collecting type ratings than they do on the line. Airlines can save tremendous amounts of money by offering those new positions to either qualified new hires or junior people elsewhere within the system who may already be qualified.

Saving money on training costs will allow more money to be allocated to compensation since in the end...it's all lumped together as labor costs for pilots as far as management is concerned.

I really like your ideas and I've been saying this for years.

I once worked for a small commuter airline (a long time ago in an airport far far away) that operated turboprops and was non union. We had a unique pay structure that was very much in line with what you are saying here. I know because I wrote the proposal and handed it to the owner directly. I argued that we could reduce training costs and turnover this way. The owner signed off on it and our turnover dropped dramatically at a time when scheduled carriers were hiring aggressively. No one took a pay cut because they were grandfathered in.

I understood that most of the pilots were just building time. One of the policies was to upgrade first officers to captain when they were ready rather than when we needed them and to do it based on their scheduled annual training to reduce costs. Their pay would still remain lower than a captain until the job became available (when they flew with other first officers) but in the meantime they could sign for the aircraft and build PIC time while earning a bit more money and continuing to fly with co captains. This prevented them from jumping to other commuters where they would start at the bottom as new hire FOs.

This policy also allowed us to hire captains from competing commuters by offering them more money for the same equipment. Back then you could factor in a pilot's currency in one airline to reduce training costs at the new airline. The airlines pushed to eliminate this because they were losing pilots to smaller operators.

The fact is there is a better way to do this but ALPA and management don't want it and they still push the old myths and propaganda to try to keep pilots in line. That's why you see the disruptive posts in these forums..they are in here too.