Negotiating in the time of Coronavirus.
 

We have a few pilot groups in negotiations right now. Is anybody besides me worried that the other side is going to attempt to use coronavirus to squeeze the pilot groups?

I don’t just mean flying cutbacks - I’m not sure anyone expects the airlines to fly empty aircraft or violate government no-fly orders - I’m really talking about negotiating (or mediation/arbitration) tactics.

I recall the Alaska Airlines arbitrator who was convinced by management to slash salaries by 27%. The infamous “Richard Kasher decision,” was that salary reductions were necessary to “ensure profitability of the airline.”

https://www.seattletimes.com/busines...rlines-pilots/

Now nobody knows for sure just how the Coronavirus is going to turn out, but it’s doubtful the current chaos is going to go on more than another six months - if only because everybody susceptible will have already had it. But I can envision management trying to lock in a five year contract at lower rates by using coronavirus and the resulting slow down for leverage.

I believe Alaska somehow wound up in binding arbitration. Involuntary pay cuts here can’t happen outside of bankruptcy.

The issue was management using the current crisis to push for a long term contract with worse terms than would have been offered say six months ago. A short term TA involving lower ALV and similar to avoid furloughs might be something we could all agree upon. My concern is that the current epidemic which I expect to be short term ( say 5-6 months) will lead to a five year contract at payscales or work rules that will lock in such concessions until long after this pandemic resolves. And pandemics DO resolve. Even the infamous 1919-20 Spanish Influenza only lasted a couple of years.

Your union could always take a page out of the management playbook and slow play it.
Its embarrassing during good times how slow a company can be to respond to a proposal.
Turn the tide and reply with a ‘we’ll get back to you on that’.

Bought years in a normal time.
In these times I have no idea how anything will look as most sectors of the economy
are going to be in a fight for survival. Personal opinion and I hope I’m wrong.

I’m really a lot more liberal than that. This is a rough time even for well run airlines. But it’s going to be over eventually. Maybe three months, maybe six months, maybe a year, but we WILL survive it. Infection and case-fatality rates are too low for any other outcome. Agree to what makes sense for three months, renewable by mutual consent only. renew as often as makes sense. But don’t get sucked into a five year contract under horrid economic conditions that will be much improved in a year.

I think we've all learned the hard way over the last couple decades.

Do what you gotta do on a TEMPORARY basis to get through (but be careful, if they file BK then your temp concessions will likely be your starting point for further cuts from the judge). May be better to take reduced hours than reduced rates.

Slow-roll regular contract negotiations in the meantime. Insist of full backpay for all reduced lines, VLOA, etc on the COVID is done... that should hold 'em at bay for a while.

Exactly what I say to myself when I’m about to forget that the twenty-six year old Regional captain was in K-12 for half of that time...:D

But yeah, those who lived it will remember it forever.

And other than that one provision, I pretty much agree with the rest of your posting.

Sure, Oscar and KIRBY will try a CV squeeze. But, the pilot group could work for free and it wouidn't help their business plan.
UAL will need to go out and secure a line of credit to run it's business. We've got like 140,000 employees- something like that? Does Oscar and Kirby want us to go out and get 140,000 separate personal loans, or does management want to do the right thing and go secure the credit they need to run their business.

The piloting profession at large has taken it on the chin since the 1980's (and in the pocket book). I am not being mean or ugly when I "this is just business." We all have a business to run. Management teams for the last 30 years have enriched themselves at our expense.during some boom times. While no one could have reasonably predicted the CV 19 virus there were signs out there that this could happen. It's management's job to prepare the company financially for bad times.

Absolutely insane to do stock buy-backs, and very reckless not to have adequate emergency funds. I have a six month emergency fund. Doesn't the company have one too? Is this any different than Jacque Lapointe blowing it on fuel hedging or bad investments in the A fund?

Nothing insane about returning value to shareholders. It’s the reason these airlines exist—to turn a profit for their investors.

Stock buybacks are just a sneaky way of doing it to avoid dividend taxation.

And mind you, these companies can re issue that stock and raise cash again. If they had laid dividends, this would not be a possibility any longer.

A 6 month emergency fund would be around 18 BILLION dollars in cash. That's borderline criminal waste of resources in a corporation.