Hello,
It appears that at ATA our financial outlook is increasingly negative.
In our last concessionary agreement "fragmentation" language was added (the language is at the bottom of this post).
What do you think of it? I'd especially appreciate hearing from people that have been benefited and/or victimized by fragmentation language in the past.
I'm curious if such language will really hold through if a merger, buyout, bankruptcy, etc. occurs. Should we at ATA be holding our breath for this language to work? What are your thoughts?
Sincerely,
Noam
Subject: Amendment to Section 1 (Fragmentation)
THIS LETTER OF AGREEMENT is entered into by and between ATA Airlines, Inc. (the "Company" or "ATA") and the Air Line Pilots Association, International (the "Association"), collectively referred to as “the Parties,” pursuant to the terms of the Railway Labor Act, as amended.
NOW, THEREFORE, the Parties agree to the following:
This shall confirm the Parties agreement to replace the language in Section 1.F. of the Collective Bargaining Agreement effective July 1, 2002 in its entirety with the following:
F. Fragmentation
1. If the Company transfers (by sale, lease or other transaction) or disposes of aircraft or route authority which produced thirty percent (30%) or more of the Company’s operating revenues over the prior twelve (12) months,or which produced thirty percent (30%) or more of the Company’s block hours over the prior twelve (12) monthsnet of additions to the Company’s operating revenues or block hours produced by aircraft or routes acquired during the same twelve (12) month period, or ten (10) aircraft whichever is less, to a person or entity or to a group of persons or entities acting in concert (the “Transferee”) that is, controls or is under the control of an air carrier or that will operate as, control or be under the control of an air carrier following its acquisition of the Company’s aircraft or route authority (any such transaction, a “Substantial Asset Sale”), then:
a. The Company shall require the Transferee to offer employment to Crewmembers from the ATA Crewmembers’ Seniority List who are Status Qualified on the aircraft being transferred and whose identity shall be determined consistent with the seniority provisions of the Agreement (the “Transferring Crewmembers”). The number of Transferring Crewmembers shall be the sum of (i) the average monthly Crewmember staffing per aircraft over the prior twelve (12) months actually utilized in the operation of the aircraft transferred to the Transferee in connection with the Substantial Asset Sale plus (ii) the average monthly Crewmember staffing over the prior twelve (12) months actually utilized in the operation of the route authority transferred to the Transferee in connection with the Substantial Asset Sale to the extent such Crewmember staffing is not included in the calculation of paragraph 1.a.(i) above; and
b. The Company shall require the Transferee to provide any Transferring Crewmembers with the seniority integration rights provided in Sections 2, 3, and 13 of the Allegheny-Mohawk LPPs except that the integration of the Transferring Crewmembers into the Transferee’s seniority list shall be governed by Association Merger Policy if both pre-transaction Crewmember groups are represented by the Association. The Company shall require the Transferee to agree, and the Transferee shall agree, to provide the seniority integration rights specified in the preceding sentence in connection with a Substantial Asset Sale in a written document.
c. For purposes of this Subsection 1., the fragmentation provisions contained herein shall not apply to the Company’s retirement of the L1011 fleet.
This Amendment to Section 1 (Fragmentation) Letter of Agreement shall be effective upon execution of and shall run concurrently with the Flight Deck Crewmembers’ Collective Bargaining Agreement that became effective on July 1, 2002. However, if a letter of commitment for the acquisition of a 100 to 110 seat aircraft is not signed by ATAH by June 30, 2005, this Amendment to Section 1 (Fragmentation) Letter of Agreement shall become null and void.
IN WITNESS WHEREOF, the parties hereto have signed this Amendment to Section 1 (Fragmentation) Letter of Agreement this ____ day of ____________, 2004.
It appears that at ATA our financial outlook is increasingly negative.
In our last concessionary agreement "fragmentation" language was added (the language is at the bottom of this post).
What do you think of it? I'd especially appreciate hearing from people that have been benefited and/or victimized by fragmentation language in the past.
I'm curious if such language will really hold through if a merger, buyout, bankruptcy, etc. occurs. Should we at ATA be holding our breath for this language to work? What are your thoughts?
Sincerely,
Noam
Subject: Amendment to Section 1 (Fragmentation)
THIS LETTER OF AGREEMENT is entered into by and between ATA Airlines, Inc. (the "Company" or "ATA") and the Air Line Pilots Association, International (the "Association"), collectively referred to as “the Parties,” pursuant to the terms of the Railway Labor Act, as amended.
NOW, THEREFORE, the Parties agree to the following:
This shall confirm the Parties agreement to replace the language in Section 1.F. of the Collective Bargaining Agreement effective July 1, 2002 in its entirety with the following:
F. Fragmentation
1. If the Company transfers (by sale, lease or other transaction) or disposes of aircraft or route authority which produced thirty percent (30%) or more of the Company’s operating revenues over the prior twelve (12) months,or which produced thirty percent (30%) or more of the Company’s block hours over the prior twelve (12) monthsnet of additions to the Company’s operating revenues or block hours produced by aircraft or routes acquired during the same twelve (12) month period, or ten (10) aircraft whichever is less, to a person or entity or to a group of persons or entities acting in concert (the “Transferee”) that is, controls or is under the control of an air carrier or that will operate as, control or be under the control of an air carrier following its acquisition of the Company’s aircraft or route authority (any such transaction, a “Substantial Asset Sale”), then:
a. The Company shall require the Transferee to offer employment to Crewmembers from the ATA Crewmembers’ Seniority List who are Status Qualified on the aircraft being transferred and whose identity shall be determined consistent with the seniority provisions of the Agreement (the “Transferring Crewmembers”). The number of Transferring Crewmembers shall be the sum of (i) the average monthly Crewmember staffing per aircraft over the prior twelve (12) months actually utilized in the operation of the aircraft transferred to the Transferee in connection with the Substantial Asset Sale plus (ii) the average monthly Crewmember staffing over the prior twelve (12) months actually utilized in the operation of the route authority transferred to the Transferee in connection with the Substantial Asset Sale to the extent such Crewmember staffing is not included in the calculation of paragraph 1.a.(i) above; and
b. The Company shall require the Transferee to provide any Transferring Crewmembers with the seniority integration rights provided in Sections 2, 3, and 13 of the Allegheny-Mohawk LPPs except that the integration of the Transferring Crewmembers into the Transferee’s seniority list shall be governed by Association Merger Policy if both pre-transaction Crewmember groups are represented by the Association. The Company shall require the Transferee to agree, and the Transferee shall agree, to provide the seniority integration rights specified in the preceding sentence in connection with a Substantial Asset Sale in a written document.
c. For purposes of this Subsection 1., the fragmentation provisions contained herein shall not apply to the Company’s retirement of the L1011 fleet.
This Amendment to Section 1 (Fragmentation) Letter of Agreement shall be effective upon execution of and shall run concurrently with the Flight Deck Crewmembers’ Collective Bargaining Agreement that became effective on July 1, 2002. However, if a letter of commitment for the acquisition of a 100 to 110 seat aircraft is not signed by ATAH by June 30, 2005, this Amendment to Section 1 (Fragmentation) Letter of Agreement shall become null and void.
IN WITNESS WHEREOF, the parties hereto have signed this Amendment to Section 1 (Fragmentation) Letter of Agreement this ____ day of ____________, 2004.
