From:
[FONT=Times New Roman,Times New Roman]Bryan LaBrecque, president & COO [/FONT]
[FONT=Times New Roman,Times New Roman]
[/FONT]
Subject:
[FONT=Times New Roman,Times New Roman]My view on the ALPA negotiations
Next week, the company negotiation team will meet with the ALPA negotiation team and the mediator from the National Mediation Board. At this meeting, the company will lay out a roadmap for advancing our pilot negotiations toward a close. We tell you what you get, and it's NOTHING! In fact you're gonna have to give back a lot of stuff. As those sessions approach, I wanted to share with you my view of the process from three months as president, and provide a summary of what I hope we will be able to achieve by working together. [/FONT]
[FONT=Times New Roman,Times New Roman]
[/FONT]
First, let’s address the obvious. These contract negotiations have gone on far too long. Where has he been the last 3 yrs? .
[FONT=Times New Roman,Times New Roman]While some would argue that the fault lies entirely with the company, ding ding ding, we have a winner! this view is completely correct. Of course, ASA bears all responsibility for the operational issues that the negotiating committees are reviewing, and we are committed to addressing many issues and concerns that I and other leaders have heard are important to you. Just as long as they are what we want you to have or not have.
Keep in mind, though, it takes two sides – working together toward realistic goals as long as they're managments goals– to come to an agreement. Since I’ve been president, I’ve had the opportunity to review the proposals that each side has made. The pilots’ union has proposed many expensive new contract provisions that simply do not make business sense for our airline. We havn't even gotten to those proposals yet! It’s our hope that we will be able to reach an agreement as quickly as possible that moves this company forward in a responsible way, and allows it to be competitive within the regional airline industry. [/FONT]
[FONT=Times New Roman,Times New Roman]
[/FONT]
Second, we are operating in a different environment.
[FONT=Times New Roman,Times New Roman]With the Delta bankruptcy and our sale to SkyWest, Inc., the entire premise for our business shifted. We no longer enjoy the benefits of being owned by Delta when we could expect to continue our Delta Connection business and continue growing just because of that relationship. Delta’s financial problems have motivated it to demand regional flying that produces acceptable operational results for less compensation. Yeah, you're gonna have to take a paycut, ok? We’re now fighting every day for every piece of our business as lower cost regional carriers redefine the industry. CAN YOU SAY "RACE TO THE BOTTOM".
When SkyWest, Inc. bought ASA, Delta insisted on a new Delta Connection agreement for ASA that is very different from the agreement under which we previously were compensated. Under this new agreement, we must operate within a specific cost framework and meet very specific, challenging operational targets. These Delta-imposed cost limits are non-negotiable, and we have a lot of work ahead of us to ensure we meet these targets. Failing to reach these specific goals [/FONT]could lead to the loss of our agreement with Delta. We want to create a bright future for our company and all ASA employees, but we have to work within the framework of the new Delta Connection agreement. Agreeing to a pilot contract that doesn’t fit inside that financial framework or allow us to reach operational targets would quickly leave us uncompetitive with an uncertain future.
Third, we must be responsible and profitable. How about managment being professional? Many of you have heard that SkyWest, Inc. is profitable. Profits are critical, and we’re hopeful that our parent continues to post strong profits. It is also essential that we be profitable. We cannot look to our parent corporation to finance our existence. We must generate our own profits to reinvest in our company – to reward employees, buy new airplanes, upgrade training programs, purchase new ground equipment, and pay for new technology. Without the financial flexibility to reinvest, we put our company at a distinct competitive disadvantage because we must have profits to finance growth and build a future. So, we must make responsible decisions that will permit us to earn a reasonable profit.
Fourth, open communication will be the key to bringing these negotiations to a close. What communication? we talk, you ignore us. We will do our best to provide ALPA information that will help them make informed, responsible decisions, because it will be the information we want them to think is the right information. Earlier this fall, for instance, we met with our unions to reveal many of the details of our new Delta Connection agreement. We provided members of the ALPA negotiating committee a great deal of information and continue to work with them and their financial analysts to answer their questions about our financial framework. How about you never did any analysis in the first place.
Fifth, patience is a prerequisite in any negotiation. I think 3 yrs of patience is more than F'in enough. Everyone wants the negotiation process to wrap up as quickly as possible, as long as it's what managment wants, but we must work within the process set by the Railway Labor Act. It’s unrealistic to think we will have a contract in place within the next few weeks but we are hopeful we can move the process forward expeditiously and reach a new agreement as quickly as possible. Reaching this goal will not be easy because there are areas of our operation where pilot costs have been allowed to grow beyond the industry average. Examples? Lets seee, some of our pilots havn't even seen a raise in 3 yrs. I think he means that we get paid at all. Cause we should want to do this job for nothing. How can things have grown above industry standard if the industry has mostly shrunk? Oh, we havn't shrunk with it. This is BS. These costs exceed the financial framework of our Delta Connection agreement, and must be addressed in the new pilot contract. CAN YOU SAY PAY CUT? The good news is that if we address our costs, I havn't heard anything about managment costs!!!!, make responsible decisions that benifit managment not taking a paycut, and resolve the operational issues the negotiating committees have been discussing the union agreeing with all of managments proposals, we should be able to generate enough profitability to attract additional growth from Delta that will sustain us into the future. We also will propose a plan to share a portion of those profits with all employees – including ASA pilots. The roadmap we will set forth next week at the negotiation session with ALPA should put us on a path toward reaching an agreement that will allow us to compete in the new environment.
Finally, while we focus on completing a new contract, I ask that you simply continue to do what you do best – which is fly safe and provide outstanding service to our customers.
