Whoosh
 

Bluedriver, you’re missing ExCargo’s point. According isn’t as black and white as you seem to think it is. There are tons of ways to massage the numbers to effect the outcomes that you want. Corporate finance is more art than math. Amazon famously netted zero profit during their tremendous growth phase (along with a meteoric share price rise). Shareholders called for Bezos’ head, right? Lulz.

There are levels to this and it would be very wise to include protections from accounting *******ery.

Major airline CBA's require the numbers used for profit sharing payout calculations be the same as those reported to shareholders. Many of these plans pay out large sums of money, in most years... Delta has had to pay particularly large payments to employees, and the CEO (past or present, can't remember which) has said they regret giving such a rich plan. Southwest has also paid large sums to employees, regularly. United just enriched their plan to match Delta's in their new agreement.

Tell me, if it was so easy to simply "accounting trick" these payments away, why haven't they been able to do it? Why are these other airlines writing these big checks if they can just manipulate the payments away?

Of course I know there are "gimmicks" that can be used, I've literally said as much in these posts. I've also given some reasons why they don't work long term in many/most cases.

But most importantly, what "protections" are you expecting or referring to? The one Cargo mentioned is laughable, if not delirious. It has been an epic battle, to date, simply to get JB management to talk about reinstating our previous profit sharing plan, or better yet improving it to an industry STANDARD plan. And profit sharing only pays during the good years... To think they would suddenly agree to a plan that not only pays during the good years, but also pays during the catastrophic years? From this management group that won't even talk about a conventional STANDARD plan enjoyed by all our peers? Are you feeling okay?

And... If JB could simply "accounting trick" the payments away on a standard profit sharing plan so easily, why haven't they just given it to us while laughing like Ray Liotta in Good Fellas??? "YEAH, SURE, HERE YOU GO JB PILOTS, GOOD LUCK WITH THAT"!!!!! (Here is where I wish I knew how to insert the Ray Liotta laughing GIF from Good Fellas).

I missed nothing at all from his points. They are either bad points, incomplete, or have no viable solution, at least not any solution he has put forth yet. And mostly, the problem he describes hasn't been much of a problem... As long as the plan and language are proper. But I do want the best plan and solution possible, so if you something valuable to add, I am listening.

And the reason my response was so aggressive to Cargo is because we have had this discussion, several times, on the JB board in the past.

And the reason I’m so aggressive is that we will likely NEVER AGAIN have the leverage we will if this actually does get to JCBA negotiations in our lifetimes. It’s Negotiations 101. It absolutely doesn’t hurt to have some unique off-the-wall ask as a shot across managements bow and may well make them cave to more peer airline like profit sharing rather than run the risk of pioneering this. That would not be a bad thing. But if you don’t think companies can avoid making profits by simply doing things that will increase share price and pay their execs with shares as the capital gains accumulate you obviously have never worked in the tech sector.
Dividends are so last century. Capital gains (unrealized and untaxed until you draw them out) rule. And no, we don’t want an ESOP. The UAL pilots got taken to the cleaners with that one at UALs bankruptcy.

On this, we agree. It's a perfectly good starting point for negotiations, which I have said, even in this discussion.

But, what I also did say (to your point about our JCBA leverage), there are many other industry leading expectations I have in pay/QOL, and those "other" priorities are ultimately more important than the distinction between profit sharing and revenue sharing. Profit sharing (or revenue sharing) is an absolute RED LINE for me, as are many other industry leading pay/QOL items. So I don't believe it's wise to use too much (greatly more than necessary) of our negotiating capital on any one item that's wildly outside of industry norms. Especially to solve a problem that so far in our industry hasn't been shown to be much of a problem.

And you have never addressed this simple question. If JetBlue could simply "accounting trick" it's way out of paying profit sharing on a properly written plan, why have they fought so incredibly hard giving it to us???

I know where your heart is on this issue, and at the core, you and I are in the same place, and on the same team. Yes, let's start the survey responses at revenue sharing. Can't have the moon if you only ask for a cheeseburger.

Good luck with NK pilots being on board with that. I even saw in one of the base chats a pilot "wish list" and it actually said under pay "no increase needed". That is who you will be getting for fellow CBA voting co workers.

What has it cost THEM in negotiating capital to stick you with the current (pretty much non-functional) profit sharing you now have? That’s an honest question - not a dig. I wasn’t following JetBlue contract negotiations when that pseudo-profit sharing plan was put in your CBA.

But again, it’s Negotiations 102:

I’ve mentioned to you before the difference between growth companies and dividend companies. LUV pays a dividend, DAL pays a dividend. Investors buy these stocks expecting a share of profits. SAVE and JBLU are growth companies, investors expect to make money through share price increase by achieving target growth rates. To achieve these growth targets, annual profits are either put back into the company (research plow back ratios) or to service debt to do the same. It’s not some tin foil hat conspiracy accounting tricks to hide profits, it’s all public record. Large, established companies are the most likely to pay significant dividends, since substantial growth is more expensive and less likely means of boosting share price (and thus shareholder wealth). This is why those Delta pilots get more significant profit sharing checks, and why the current B6 language doesn’t yield very much.

Even combined with NK, JetBlue has some serious capital expenditures ahead of it if they want to continue growth and expansion to break into the legacy playing field. More planes, more staff, more infrastructure. It’s highly unlikely that JBLU will offer a dividend to shareholders for the foreseeable future. This is also why it’s unlikely that stronger profit sharing language will result in those fat annual checks you salivate over. Revenue sharing may result in that, but a slice of the pie before all the bills are paid, or even the shareholders are paid, well that’s an even tougher ask.

TL/DR it’s foolish to expect profit sharing to yield anything significant until the stockholders who own the company are receiving a taste.

Should be a damn easy get then.

No, that doesn't answer my question. We asked, and pushed very hard (not max hard, but a strong effort was made). On several occasions. They absolutely refused, said it was a "non-starter".

Why is it a "non-starter" for management if they can just "accounting trick" their way out of paying us?

Well, for much of JB's earlier existence (remember the whole company is only ~23 years old) they had a much richer profit sharing plan than now. Those were when the company was REALLY a growth company. And several years we got really big checks. So at least I know I don't have to listen to your "info" anymore.

And you can keep your low expectations, and company sympathy out of our upcoming JCBA negotiations. For most of JB, we want back what we had for most/much of the airlines existence.

Right? He doesn't see the irony in his logic. And he's plain wrong on the facts.

That would be a question you would have to ask management, not me. But you could ask the same thing about EVERY SINGLE CBA IMPROVEMENT you want in the JCBA. WHY WOULD. THEY GIVE IT TO YOU NOW IF THEY DIDN’t give it to you last time?

But that’s a pretty defeatist attitude. Last time they did not have a pilot shortage or be hemorrhaging FOs to the legacies OR NEED A JCBA TO GET RETURN ON A SEVERAL BILLION DOLLAR PURCHASE. So now is NOT the time to start negotiations with a “they’ll never concede on that issue” attitude or it will soon become a self fulfilling prophecy. We’ve not had leverage like this ever. Now is the time to think big.

https://i.ibb.co/NCSf70N/IMG-6246.jpg


And I ask you again-

I don't really understand your question, but you still didn't answer mine.

You say management can just "accounting trick" their way out of paying. So then why have they refused to give us back the plan? Why refuse to give us something that is in your mind virtually worthless? I don't get that, and you aren't really answering it. If they don't have to pay, and it doesn't cost them anything, why not just give it to us?

Why SHOULD they bother when they aren’t paying you any meaningful PS now?

But why are YOU so averse to even bringing up the idea of revenue sharing? This is scarcely a new concept.
example:

https://www.investopedia.com/ask/ans...k-practice.asp

https://smallbusiness.chron.com/adva...ing-21864.html


Revenue sharing is scarcely alien to the airline business. It’s pretty much the basis for the legacy regional feed model, where the legacy sells the tickets and pays a share of the revenue to the regional.

You're not making any sense. They should bother, because we have made it a priority in several negotiations sessions. Several negotiations sessions/MOUs/LOAs/contract extensions were drawn out and we achieved other gains, because management refused to give us the profit sharing plan back. The question is, why did they fight so hard to keep something from us that is "worthless" (paraphrasing)? Why go through all the extra work and give up gains to the pilots IN LIEU OF SOMETHING WORTHLESS? Why not simply give us the worthless thing???

Why did AA and UAL pilots make profit sharing improvements a pillar of their recent/current negotiations? I mean, if it's worthless (can just be accounting tricked away) then why bother?

Why did Delta literally make it a written pillar of their negotiations? Don't they know it's just gonna be accounting tricked away?

As for revenue sharing, I've said my piece on that. But bringing up regional code sharing business structure as an example of how revenue sharing has been given to pilots, give me a break.

Bluedriver, you really should take a breath and think deeper about what we're trying to say. Profit sharing based on net income is really weak. It's not an "accounting gimmick". It's GAAP accounting 101. And, it's how hundreds of growth companies structure their finances.

Don't end up scratching your head in confusion 10 years later when the company prints cash, triples in size, the stock goes parabolic, and not once reports a positive net income.

...........

I couldn't bring myself to read the bickering, but I'm having a tough week and needed a chuckle. Thanks for that.

Not bickering at all and I actually like Bluedriver. I’d just like him to expand his retinue of things he might CONSIDER like I think he has done with DTZ which at one time he was adamantly opposed to but as he became better acquainted with it through the give and take on here he came to better appreciate.

But we all sit in hotels sometimes and it would be advantageous for us ALL to give serious considerations for what we want and what the possibilities are for the JCBA. We may be living under that JCBA for half a decade. The MEC and the NC can’t do all the thinking for us.

I appreciate that man. One of the few virtues I aspire to, is to still be able to recognize my initial bias's, change my opinion, and adopt a new or different idea. Sounds like you guys are pulling that off.

Sounds like you and I may walked the sidewalk together with the corny signs, and I just hope the combined group has the stones to demand nothing less than DAL/UAL parity or shut the whole M'Fer down again.

I also agree it's all in the details, so it's going to back a lot of back and forth, so my lazy @ss is grateful for guys like you two who are bright enough to have these discussions.

My concern is the very new guys will be dazzled by the old shiney jet syndrome and an "adequate" agreement. After all, even a crap agreement beats a recent CFI gig, and I'm afraid they'll fall for it.

Dont end up scratching your head when JB pilots get the profit sharing plan BACK that they used to have, when the company was an even younger growth company, and it starts paying good checks AGAIN.

Play nice boys. You're both too smart to let the internet get to you. It's a good conversation, and some of us need to hear different opinions about the details you guys are talking about.

Don't disagree, but I certainly don't need to hear from him why we can't have back what we already had and how the plan wouldn't pay anything ("because we're a growth company"), yet in actuality it paid quite a lot over several years.

I never said that. I said there are better ways to calc profit sharing that are less susceptible to accounting shenanigans than net income. All airline profit sharing language is weak, imo. We could/should do better with this contract.

Can you quote me ever saying "net income" please? I'll wait.

A question while you're looking for that quote.

Is English your primary language? You regularly start arguing points that others haven't made, only to argue with yourself, about something you brought into the conversation.

Ok, my bad. Based on how you were using the term "profit" I assumed you referring to the GAAP definition of Net Income (which is typically synonymous). That also happens to be how UA/DL/B6 calculate profit sharing. Well, more accurately they use the term "pre-tax profit" which they define as Net Income before taxes so they can deduct the profit sharing payment. But, it's based on Net Income.

Don't confuse your lack of accounting 101 knowledge for my deficiency in English. Lulz.

Miatas are not sports cars. Change my mind….

Well seeing that in the US and I assume most places “net income” is post tax, what you meant was “gross income” so good job f’ing that up as well.

No. Gross Income is related to an individual's taxes. You might be thinking of Gross Profit which is the GAAP term. Back on topic, Gross Profit is similar to EBITDA, which would be a much better number to use for profit sharing.

The language in the contract(s) is “Pre-Tax Profit” which is a made up term, but they define it as pre-tax (and other adjustments to) Net Income.

Why would I try a change a perfectly good opinion. When you're right, you're right.

What’s a Miata??












Kidding

I've gotten called twice for surveys, hung up both times. And I refuse to do the union surveys. I don't need the company associating my names with my negative answers. NO WAY!

Dont drink and post