MOONBEAM
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- Aug 24, 2004
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What do you think ALPA has planned to strengthen the regional airline pilot groups? Can the regional pilot groups stand up for each other and come up with a plan to stop the race for the bottom? Here are a couple for articles from ALPA.
http://www.alpa.org/DesktopModules/ALPA_Documents/ALPA_DocumentsView.aspx?itemid=2298&ModuleId=2618&Tabid=73
http://www.alpa.org/Default.aspx?tabid=179
January 24, 2006
Capt. Woerth Forms “Fee-For-Departure Task Force”
ALPA has unveiled a new initiative in its long fight to protect the wages and work rules of express pilots--a Fee-For-Departure Task Force.
Like their counterparts who fly for legacy carriers, ALPA pilots who fly for express carriers have regularly met and shared information during the last several years in a coordinated effort to protect their rates of pay and work rules. As capacity in the 50-seat jet market has grown to exceed demand, this group now faces a new and difficult challenge from their managements.
Much of the flying that express pilots perform is done under so-called “fee-for-departure.” Under this type of agreement, a mainline carrier agrees to pay the express partner a fixed fee for each flight serving the mainline carrier. Recently, several mainline carriers have put out requests for proposals “inviting” express carriers throughout the industry to bid for the right to partner for them. The flying goes to the express carrier willing to fly for the lowest fee per departure.
To secure a piece of this shrinking pie, many express carriers, arguing that they need relief to compete for the right to partner with a legacy carrier, have sought concessions from their pilot groups. The result is a brutal race to the bottom for employees.
In light of managements’ attempts to whipsaw one pilot group against another, leaders from several express carrier pilot groups recently concluded that ALPA needed to devise specific strategies to vigorously resist these pressures. In response, ALPA's president, Capt. Duane Woerth, last week formed a “Fee-For-Departure Task Force” and charged it to develop recommendations for an effective strategy to resist unreasonable demands for concessions and to maintain minimum standards for rates of pay among express carrier pilot groups.
The members of the Fee-For-Departure Task Force are
“Pinnacle and Atlantic Southeast are directly affected, but Continental has threatened Express Jet, and American Eagle management won’t sit back as the feeding frenzy begins,” Capt. Woerth continued. “Every pilot--express and mainline pilots alike--has a stake in this fight. If we pull together and refuse to be pitted against each other, as management is attempting to do, we will succeed in protecting the pay and work rules that our profession deserves.”
From the President
‘Pay to Play’ Costs Too Much
In 2003, Air Wisconsin pilots thought they had made it through the downturn in the airline industry when they agreed to concessions, which were contingent upon the carrier securing a new and fully effective United Airlines code-share agreement that the bankruptcy court approved. That’s why they were so surprised when they found out, well after the fact, that the new code-share agreement had not been assumed by United. In a bid to re-secure the flying for United, Air Wisconsin management suggested further concessions to finance United’s hard-line financial conditions.
Given the overall health of the airline industry and the uncertain future that the Air Wisconsin pilots would face without the United flying, their caving in would have been easy to understand. But they did not. They told management that they would not entertain any further concessions.
Faced with the real potential of losing the United code-share, Air Wisconsin management used an investment-arm subsidiary to invest in US Airways in exchange for the right to fly seventy 50-seat jets. Pilots had defended their contract, and the airline had found a home in the reshuffled world of mainline-small jet partnerships.
This story lays bare a fresh challenge facing the airline industry today. The days of guaranteed fee-for-departure profits--even as the mainline carriers hemorrhaged cash --are over. Mainline carriers are using their brand power to leverage one small-jet carrier against another in a new system I call "Pay to Play." And small-jet carrier managements are only too willing to play the game.
Here’s how it works: In bankruptcy, a mainline carrier finally gets to renegotiate its affiliated carrier contracts. Tired of guaranteeing profits to capacity providers, mainline management makes a proposal to as many of them as possible to fly for the lowest cost possible. To win the bid, some "pay to play" when their managements agree to terms below their current costs. In the construction business, if a contractor bids for work below his costs, the contractor eats the losses. However, this is the airline business.
Instead, the "pay to play" management emerges from the corporate suite with a plan: Turn to the pilots and asks them to finance the deal by granting concessions, while dangling a carrot like future 70-seat flying. The ball is then in management’s court, and pilots have a choice to make. Pilots can transfer their hard-fought gains to shareholders, or they can hold firm and require their management to manage competently, by refusing to bid below their costs.
If pilots decide to subsidize the "pay to play" game, the bar shifts lower for all of us.
On the other hand, if pilots refuse to play, management has to find a new way to finance its decisions. Both management and pilots suffer pain in the short term. But in the longer term, other pilots will strengthen their resolve, and management will understand that underbidding to capture flying is an irrational strategy.
We’re seeing the "pay to play" phenomenon across our union. Atlantic Southeast, Comair, Mesa, Mesaba, Pinnacle, and several others are either in the crosshairs or getting close. That’s why ALPA called a meeting in Herndon, Va., recently to gather several MEC leaders with our Representation, Legal, Economic and Financial Analysis, and Communications Departments to build a strategy to bolster pilot groups as they stand up to the pressure.
Make no mistake--this is no easy task. The loss of capacity we are witnessing will ratchet up the pressure everywhere to capture flying.
But no pilot group can guarantee its future by standing alone. Only by standing together and holding up a collective banner that says, "We Refuse to Subsidize Management’s Decisions," can we preserve this profession, stabilize the wage and benefit bar, and begin to exert our own leverage upward.
For those of you on the mainline carriers who might either be gratified that someone else is being hurt or feel this is not your fight, I have one word: Wrong. This is your fight too, because as soon as managements are able to lower the small-jet bar, they’ll sharpen their knives and come back to you to "close the gap" yet again.
http://www.alpa.org/DesktopModules/ALPA_Documents/ALPA_DocumentsView.aspx?itemid=2298&ModuleId=2618&Tabid=73
http://www.alpa.org/Default.aspx?tabid=179
January 24, 2006
Capt. Woerth Forms “Fee-For-Departure Task Force”
ALPA has unveiled a new initiative in its long fight to protect the wages and work rules of express pilots--a Fee-For-Departure Task Force.
Like their counterparts who fly for legacy carriers, ALPA pilots who fly for express carriers have regularly met and shared information during the last several years in a coordinated effort to protect their rates of pay and work rules. As capacity in the 50-seat jet market has grown to exceed demand, this group now faces a new and difficult challenge from their managements.
Much of the flying that express pilots perform is done under so-called “fee-for-departure.” Under this type of agreement, a mainline carrier agrees to pay the express partner a fixed fee for each flight serving the mainline carrier. Recently, several mainline carriers have put out requests for proposals “inviting” express carriers throughout the industry to bid for the right to partner for them. The flying goes to the express carrier willing to fly for the lowest fee per departure.
To secure a piece of this shrinking pie, many express carriers, arguing that they need relief to compete for the right to partner with a legacy carrier, have sought concessions from their pilot groups. The result is a brutal race to the bottom for employees.
In light of managements’ attempts to whipsaw one pilot group against another, leaders from several express carrier pilot groups recently concluded that ALPA needed to devise specific strategies to vigorously resist these pressures. In response, ALPA's president, Capt. Duane Woerth, last week formed a “Fee-For-Departure Task Force” and charged it to develop recommendations for an effective strategy to resist unreasonable demands for concessions and to maintain minimum standards for rates of pay among express carrier pilot groups.
The members of the Fee-For-Departure Task Force are
- Capt. John Mondus (Air Wisconsin), Negotiating Committee chairman
- First Officer Andy Nordgren (American Eagle), Negotiating Committee chairman
- Capt. Cory Tennen (Comair), Negotiating Committee chairman
- Capt. Neal Schwartz (Express Jet), Negotiating Committee chairman
- Capt. Mark Nagel (Mesaba), Negotiating Committee member
“Pinnacle and Atlantic Southeast are directly affected, but Continental has threatened Express Jet, and American Eagle management won’t sit back as the feeding frenzy begins,” Capt. Woerth continued. “Every pilot--express and mainline pilots alike--has a stake in this fight. If we pull together and refuse to be pitted against each other, as management is attempting to do, we will succeed in protecting the pay and work rules that our profession deserves.”
From the President
‘Pay to Play’ Costs Too Much
In 2003, Air Wisconsin pilots thought they had made it through the downturn in the airline industry when they agreed to concessions, which were contingent upon the carrier securing a new and fully effective United Airlines code-share agreement that the bankruptcy court approved. That’s why they were so surprised when they found out, well after the fact, that the new code-share agreement had not been assumed by United. In a bid to re-secure the flying for United, Air Wisconsin management suggested further concessions to finance United’s hard-line financial conditions.
Given the overall health of the airline industry and the uncertain future that the Air Wisconsin pilots would face without the United flying, their caving in would have been easy to understand. But they did not. They told management that they would not entertain any further concessions.
Faced with the real potential of losing the United code-share, Air Wisconsin management used an investment-arm subsidiary to invest in US Airways in exchange for the right to fly seventy 50-seat jets. Pilots had defended their contract, and the airline had found a home in the reshuffled world of mainline-small jet partnerships.
This story lays bare a fresh challenge facing the airline industry today. The days of guaranteed fee-for-departure profits--even as the mainline carriers hemorrhaged cash --are over. Mainline carriers are using their brand power to leverage one small-jet carrier against another in a new system I call "Pay to Play." And small-jet carrier managements are only too willing to play the game.
Here’s how it works: In bankruptcy, a mainline carrier finally gets to renegotiate its affiliated carrier contracts. Tired of guaranteeing profits to capacity providers, mainline management makes a proposal to as many of them as possible to fly for the lowest cost possible. To win the bid, some "pay to play" when their managements agree to terms below their current costs. In the construction business, if a contractor bids for work below his costs, the contractor eats the losses. However, this is the airline business.
Instead, the "pay to play" management emerges from the corporate suite with a plan: Turn to the pilots and asks them to finance the deal by granting concessions, while dangling a carrot like future 70-seat flying. The ball is then in management’s court, and pilots have a choice to make. Pilots can transfer their hard-fought gains to shareholders, or they can hold firm and require their management to manage competently, by refusing to bid below their costs.
If pilots decide to subsidize the "pay to play" game, the bar shifts lower for all of us.
On the other hand, if pilots refuse to play, management has to find a new way to finance its decisions. Both management and pilots suffer pain in the short term. But in the longer term, other pilots will strengthen their resolve, and management will understand that underbidding to capture flying is an irrational strategy.
We’re seeing the "pay to play" phenomenon across our union. Atlantic Southeast, Comair, Mesa, Mesaba, Pinnacle, and several others are either in the crosshairs or getting close. That’s why ALPA called a meeting in Herndon, Va., recently to gather several MEC leaders with our Representation, Legal, Economic and Financial Analysis, and Communications Departments to build a strategy to bolster pilot groups as they stand up to the pressure.
Make no mistake--this is no easy task. The loss of capacity we are witnessing will ratchet up the pressure everywhere to capture flying.
But no pilot group can guarantee its future by standing alone. Only by standing together and holding up a collective banner that says, "We Refuse to Subsidize Management’s Decisions," can we preserve this profession, stabilize the wage and benefit bar, and begin to exert our own leverage upward.
For those of you on the mainline carriers who might either be gratified that someone else is being hurt or feel this is not your fight, I have one word: Wrong. This is your fight too, because as soon as managements are able to lower the small-jet bar, they’ll sharpen their knives and come back to you to "close the gap" yet again.
--Capt. Duane Woerth, ALPA President
