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NWA pilots draw firm line on pay parity with Delta
By LIZ FEDOR, Star Tribune
June 5, 2008
Two Delta Air Lines executives came to St. Paul Thursday to hear Northwest Airlines pilot union leaders deliver an unequivocal message that Northwest pilots be paid equally to their Delta counterparts when a joint contract takes effect.
"To have a successful merger, all pilots and all employees have to be treated the same," said Dave Stevens, chairman of the Northwest pilots union, after pilot leaders met for 2 1/2 hours with key Delta executives. Pilot leaders told their members this week that Delta management intends to "propose a phase-in of pay increases for Northwest pilots to bring them to pay parity over some unknown period of time."
Delta management negotiated pay raises for the company's pilots before announcing the merger proposal in mid-April. Northwest pilots are still covered by a contract that has lower wages than Delta's pilot pay rates.
Delta President Ed Bastian gave little indication Thursday of how the airline will respond in contract negotiations. "They expressed their views and I heard them and I understand them," Bastian said in an interview after the session.
It was Bastian's first meeting with the executive council of the Northwest pilots union.
The Northwest union is a branch of the Air Line Pilots Association (ALPA). Bastian was joined by Mike Campbell, Delta's executive vice president who handles labor relations.
"It was not a negotiating session," Bastian said. But Delta management will enter bargaining later this month to negotiate a joint contract with the ALPA leaders from Northwest and Delta.
In February, Delta management had reached a deal on a four-year contract with the two pilot groups, but the groups failed to solve the vexing problem of how to merge their seniority lists. Consequently, Delta moved ahead and negotiated a deal with Delta pilots that gives them a 5 percent pay raise in 2009, followed by 4 percent annual raises through 2012.
To increase their bargaining leverage, Northwest pilot leaders had urged John Prater, president of ALPA International, to refuse to sign the new Delta contract. But Delta's labor deal can take effect. In a Wednesday hotline message, the Northwest union leaders said that, to their "great disappointment," Prater signed the Delta labor agreement late last week.
Bastian and Campbell came to the Northwest pilots' turf on Thursday to "discuss the current state of the merger and the financial picture within the industry," Bastian said.
The pilots said late Thursday that they expect to see a revised Delta business plan next week.
The men spoke a few hours after Continental announced that it would slash its domestic capacity by 11 percent in the fourth quarter and a day after United disclosed that it would reduce its U.S. flying by 14 percent in the fall.
"The impact of fuel on our industry is unprecedented, and as a result carriers are having to make some pretty significant changes to their business," Bastian said. Oil prices have doubled in the past year. But he added that "the other carriers largely are just catching up to us now."
Eleven weeks ago, Delta announced it would cut its fourth-quarter domestic capacity by 10 percent, and it already has decided to grant voluntary severance packages to more than 3,000 employees. In early April, Northwest announced capacity reductions that will occur after the summer travel season.
"Our pilots strongly oppose the merger as it now stands," Northwest ALPA's Stevens testified last month before a congressional committee. "The total economic potential of the combined [airline] will not be achieved without a joint contract, which is the only way for all of the predicted revenue enhancements and cost savings to be realized," Stevens told the House Aviation Subcommittee.
Bastian, who also is Delta's chief financial officer, said the merger could achieve substantially more than $1 billion in savings and revenue growth.
Simply with the new Delta pilot contract in hand, "the bulk of the revenue [benefits would begin] on Day 1" of the merger, Bastian said in an interview last week.
But he was in Minnesota Thursday highlighting the need for a contract covering both Delta and Northwest pilots, so ultimately all benefits of a merger could be achieved.
Liz Fedor • 612-673-7709
© 2008 Star Tribune. All rights reserved.
Bye Bye--General Lee
By LIZ FEDOR, Star Tribune
June 5, 2008
Two Delta Air Lines executives came to St. Paul Thursday to hear Northwest Airlines pilot union leaders deliver an unequivocal message that Northwest pilots be paid equally to their Delta counterparts when a joint contract takes effect.
"To have a successful merger, all pilots and all employees have to be treated the same," said Dave Stevens, chairman of the Northwest pilots union, after pilot leaders met for 2 1/2 hours with key Delta executives. Pilot leaders told their members this week that Delta management intends to "propose a phase-in of pay increases for Northwest pilots to bring them to pay parity over some unknown period of time."
Delta management negotiated pay raises for the company's pilots before announcing the merger proposal in mid-April. Northwest pilots are still covered by a contract that has lower wages than Delta's pilot pay rates.
Delta President Ed Bastian gave little indication Thursday of how the airline will respond in contract negotiations. "They expressed their views and I heard them and I understand them," Bastian said in an interview after the session.
It was Bastian's first meeting with the executive council of the Northwest pilots union.
The Northwest union is a branch of the Air Line Pilots Association (ALPA). Bastian was joined by Mike Campbell, Delta's executive vice president who handles labor relations.
"It was not a negotiating session," Bastian said. But Delta management will enter bargaining later this month to negotiate a joint contract with the ALPA leaders from Northwest and Delta.
In February, Delta management had reached a deal on a four-year contract with the two pilot groups, but the groups failed to solve the vexing problem of how to merge their seniority lists. Consequently, Delta moved ahead and negotiated a deal with Delta pilots that gives them a 5 percent pay raise in 2009, followed by 4 percent annual raises through 2012.
To increase their bargaining leverage, Northwest pilot leaders had urged John Prater, president of ALPA International, to refuse to sign the new Delta contract. But Delta's labor deal can take effect. In a Wednesday hotline message, the Northwest union leaders said that, to their "great disappointment," Prater signed the Delta labor agreement late last week.
Bastian and Campbell came to the Northwest pilots' turf on Thursday to "discuss the current state of the merger and the financial picture within the industry," Bastian said.
The pilots said late Thursday that they expect to see a revised Delta business plan next week.
The men spoke a few hours after Continental announced that it would slash its domestic capacity by 11 percent in the fourth quarter and a day after United disclosed that it would reduce its U.S. flying by 14 percent in the fall.
"The impact of fuel on our industry is unprecedented, and as a result carriers are having to make some pretty significant changes to their business," Bastian said. Oil prices have doubled in the past year. But he added that "the other carriers largely are just catching up to us now."
Eleven weeks ago, Delta announced it would cut its fourth-quarter domestic capacity by 10 percent, and it already has decided to grant voluntary severance packages to more than 3,000 employees. In early April, Northwest announced capacity reductions that will occur after the summer travel season.
"Our pilots strongly oppose the merger as it now stands," Northwest ALPA's Stevens testified last month before a congressional committee. "The total economic potential of the combined [airline] will not be achieved without a joint contract, which is the only way for all of the predicted revenue enhancements and cost savings to be realized," Stevens told the House Aviation Subcommittee.
Bastian, who also is Delta's chief financial officer, said the merger could achieve substantially more than $1 billion in savings and revenue growth.
Simply with the new Delta pilot contract in hand, "the bulk of the revenue [benefits would begin] on Day 1" of the merger, Bastian said in an interview last week.
But he was in Minnesota Thursday highlighting the need for a contract covering both Delta and Northwest pilots, so ultimately all benefits of a merger could be achieved.
Liz Fedor • 612-673-7709
© 2008 Star Tribune. All rights reserved.
Bye Bye--General Lee
