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Brace for turbulence at American
By TREBOR BANSTETTER
The criticism against Ralph Hunter and his colleagues is fierce and relentless.
They’re out of touch with rank-and-file pilots. They’re isolating themselves in clubby headquarters suites. They focus on personal enrichment rather than the well-being of the airline’s pilots.
One might almost think they’re airline executives rather than labor union leaders.
Hunter, president of the American Airlines pilots union, is facing a stiff re-election bid, as are several other top officers. Their opponents have been hurling the type of invective Hunter has regularly aimed at airline executives in the past year.
"It’s been hard to tell the difference between American management and the [union’s] leadership," said Karl Schricker, an American captain based at Dallas/Fort Worth Airport who is vying for Hunter’s seat. "They’ve represented management more than pilots over the last two years."
The elections at the Allied Pilots Association, which will probably be determined in June, come at a crucial time for Fort Worth-based American Airlines.
The union is negotiating a new contract to replace one that will become amendable next year. Pilots are eager to get back the $660 million in annual wages and benefits they gave up in 2003 when American was facing bankruptcy, while executives are determined to keep labor costs under control.
Analysts say the union’s leadership will help determine whether the talks go smoothly or result in increased hostility among employees. The labor group, which can affect a wide range of issues including international flying and fuel conservation, could also play a critical role in any merger that involves American in coming years.
"The union leadership can make a huge difference, a material difference, at American," said Stuart Klaskin, an industry consultant with Klaskin, Kushner and Co. in Coral Gables, Fla. "It’s something that American is paying very close attention to."
It’s no surprise that criticism of American’s executives by union officials has increased recently as the election heats up, longtime industry analyst Darryl Jenkins said.
"The elections increase the rhetoric, to be sure," he said. "The unions are on the warpath."
After several years of improvement, relations between labor and management at American have crumbled. Employees are especially unhappy with a slate of stock-based bonuses for top managers and executives.
Hunter says that he has helped keep the airline out of bankruptcy and return to profitability, putting pilots in a position where they can demand a return of the wages and benefits they lost in 2003.
"It’s easy to come and throw rocks at the people who have been in charge during one of the toughest times in the history of the airline business," he said.
But he is nonetheless under pressure to demonstrate his credibility as an aggressive leader willing to take on management. All of his opponents are running on similar platforms alleging that Hunter and his fellow union officers -- Vice President Sam Bertling and Secretary-Treasurer Jim Eaton -- have been too friendly with airline executives at the expense of pilots.
"They pander to management," said Lloyd Hill, an international Boeing 767 captain based in Miami. "They’re not solely focused on what’s best for the membership."
Early voting indicates that Hill is Hunter’s strongest opponent. In the first round of voting last month, which determined the candidates who will be on the ballot, Hunter received 1,117 votes while Hill garnered 891.
Steve Roach, a San Francisco-based captain, received 652 votes. Schricker garnered 499.
The Allied Pilots Association, which represents about 9,000 working American pilots, as well as 2,800 furloughed pilots, elects its leaders every three years. This year''s election will be monitored by the U.S. Department of Labor after complaints about electronic balloting in the 2004 vote.
Hunter expects to face one of his challengers in a runoff scheduled for June.
"This thing is clearly teeing up for a runoff," he acknowledged. "Right now my opponents'' supporters are highly energized."
He predicts he will prevail in general voting, which tends to have a higher turnout than the initial round.
The union’s top jobs pay well. During the 2006 fiscal year, for example, Hunter was paid $130,000 by the union, including a $98,000 salary and more than $30,000 in expenses, according to documents filed with the Department of Labor. That’s in addition to his compensation from American Airlines for flying.
Too cozy?
The arguments against Hunter stem, in part, from his efforts in 2004 and 2005 to work with airline executives to improve operations. The much-touted "pull together, win together" initiative, spearheaded by CEO Gerard Arpey, encouraged labor and management to work together to improve efficiency, cut costs and increase revenue.
Under Hunter’s leadership, pilots worked to reduce fuel consumption, helped lobby Congress for pension reform and agreed to fly a route between Chicago and Delhi, India, even though flights that long weren’t allowed under their contract.
But the management bonus issue, which surfaced in early 2006, has quelled much of the appetite for cooperation. The annual bonuses, which amounted to $95 million last year for about 1,000 top managers and are likely to be even larger this year, appalled many pilots, who had been working under reduced salaries and benefits since 2003.
Hunter argues that American’s executives failed, not the union. He was willing to give cooperation a chance until the bonuses were paid out, he said.
"We took a very large step in a very nontraditional way to explore another way to do business," he said. "We did it with a firm belief that it was the best for the pilots."
It failed, he said, "because management didn’t recognize that they had to stay on that path as well."
Hunter’s opponents also cite his involvement with the 2003 concessions. He was on the negotiating committee at the time, and is closely aligned with John Darrah, then the union’s president.
Roach, for example, said the 2003 contracts should have mandated a return to full pay once the airline began making money again.
"It was extremely bad, naive, amateur business," Roach said.
Hunter refuses to apologize for the 2003 deal, saying it was the only way to keep American out of bankruptcy. That saved the pilots'' pensions, he said, and now their salaries are higher than those of pilots at Northwest, Delta and United, which all filed for bankruptcy.
He also points out that his first union job was working on the strike preparedness committee, and that he was the union’s vice president in 1997 during a strike over a new contract. "My history and my roots in this organization are in strike preparedness," he said.
Hunter has taken an increasingly tough stance publicly. He recently told television reporters that the union could strike next year if pilots don’t see wages return. And he has organized an April 18 rally and march on American headquarters to protest the latest bonuses, which are to be paid that day.
"I don’t think there are really that many differences" between the candidates when it comes to confronting management, he said.
Hunter’s opponents have also criticized the union’s progress in the current contract talks, and they have alleged that the labor group’s upper echelons have been distant and detached from the rank and file.
"It’s time to take back the APA," said Pete Oborski, who is running for vice president on a slate with Schricker. "It’s hard to follow the guys who led the retreat into the charge."
By TREBOR BANSTETTER
The criticism against Ralph Hunter and his colleagues is fierce and relentless.
They’re out of touch with rank-and-file pilots. They’re isolating themselves in clubby headquarters suites. They focus on personal enrichment rather than the well-being of the airline’s pilots.
One might almost think they’re airline executives rather than labor union leaders.
Hunter, president of the American Airlines pilots union, is facing a stiff re-election bid, as are several other top officers. Their opponents have been hurling the type of invective Hunter has regularly aimed at airline executives in the past year.
"It’s been hard to tell the difference between American management and the [union’s] leadership," said Karl Schricker, an American captain based at Dallas/Fort Worth Airport who is vying for Hunter’s seat. "They’ve represented management more than pilots over the last two years."
The elections at the Allied Pilots Association, which will probably be determined in June, come at a crucial time for Fort Worth-based American Airlines.
The union is negotiating a new contract to replace one that will become amendable next year. Pilots are eager to get back the $660 million in annual wages and benefits they gave up in 2003 when American was facing bankruptcy, while executives are determined to keep labor costs under control.
Analysts say the union’s leadership will help determine whether the talks go smoothly or result in increased hostility among employees. The labor group, which can affect a wide range of issues including international flying and fuel conservation, could also play a critical role in any merger that involves American in coming years.
"The union leadership can make a huge difference, a material difference, at American," said Stuart Klaskin, an industry consultant with Klaskin, Kushner and Co. in Coral Gables, Fla. "It’s something that American is paying very close attention to."
It’s no surprise that criticism of American’s executives by union officials has increased recently as the election heats up, longtime industry analyst Darryl Jenkins said.
"The elections increase the rhetoric, to be sure," he said. "The unions are on the warpath."
After several years of improvement, relations between labor and management at American have crumbled. Employees are especially unhappy with a slate of stock-based bonuses for top managers and executives.
Hunter says that he has helped keep the airline out of bankruptcy and return to profitability, putting pilots in a position where they can demand a return of the wages and benefits they lost in 2003.
"It’s easy to come and throw rocks at the people who have been in charge during one of the toughest times in the history of the airline business," he said.
But he is nonetheless under pressure to demonstrate his credibility as an aggressive leader willing to take on management. All of his opponents are running on similar platforms alleging that Hunter and his fellow union officers -- Vice President Sam Bertling and Secretary-Treasurer Jim Eaton -- have been too friendly with airline executives at the expense of pilots.
"They pander to management," said Lloyd Hill, an international Boeing 767 captain based in Miami. "They’re not solely focused on what’s best for the membership."
Early voting indicates that Hill is Hunter’s strongest opponent. In the first round of voting last month, which determined the candidates who will be on the ballot, Hunter received 1,117 votes while Hill garnered 891.
Steve Roach, a San Francisco-based captain, received 652 votes. Schricker garnered 499.
The Allied Pilots Association, which represents about 9,000 working American pilots, as well as 2,800 furloughed pilots, elects its leaders every three years. This year''s election will be monitored by the U.S. Department of Labor after complaints about electronic balloting in the 2004 vote.
Hunter expects to face one of his challengers in a runoff scheduled for June.
"This thing is clearly teeing up for a runoff," he acknowledged. "Right now my opponents'' supporters are highly energized."
He predicts he will prevail in general voting, which tends to have a higher turnout than the initial round.
The union’s top jobs pay well. During the 2006 fiscal year, for example, Hunter was paid $130,000 by the union, including a $98,000 salary and more than $30,000 in expenses, according to documents filed with the Department of Labor. That’s in addition to his compensation from American Airlines for flying.
Too cozy?
The arguments against Hunter stem, in part, from his efforts in 2004 and 2005 to work with airline executives to improve operations. The much-touted "pull together, win together" initiative, spearheaded by CEO Gerard Arpey, encouraged labor and management to work together to improve efficiency, cut costs and increase revenue.
Under Hunter’s leadership, pilots worked to reduce fuel consumption, helped lobby Congress for pension reform and agreed to fly a route between Chicago and Delhi, India, even though flights that long weren’t allowed under their contract.
But the management bonus issue, which surfaced in early 2006, has quelled much of the appetite for cooperation. The annual bonuses, which amounted to $95 million last year for about 1,000 top managers and are likely to be even larger this year, appalled many pilots, who had been working under reduced salaries and benefits since 2003.
Hunter argues that American’s executives failed, not the union. He was willing to give cooperation a chance until the bonuses were paid out, he said.
"We took a very large step in a very nontraditional way to explore another way to do business," he said. "We did it with a firm belief that it was the best for the pilots."
It failed, he said, "because management didn’t recognize that they had to stay on that path as well."
Hunter’s opponents also cite his involvement with the 2003 concessions. He was on the negotiating committee at the time, and is closely aligned with John Darrah, then the union’s president.
Roach, for example, said the 2003 contracts should have mandated a return to full pay once the airline began making money again.
"It was extremely bad, naive, amateur business," Roach said.
Hunter refuses to apologize for the 2003 deal, saying it was the only way to keep American out of bankruptcy. That saved the pilots'' pensions, he said, and now their salaries are higher than those of pilots at Northwest, Delta and United, which all filed for bankruptcy.
He also points out that his first union job was working on the strike preparedness committee, and that he was the union’s vice president in 1997 during a strike over a new contract. "My history and my roots in this organization are in strike preparedness," he said.
Hunter has taken an increasingly tough stance publicly. He recently told television reporters that the union could strike next year if pilots don’t see wages return. And he has organized an April 18 rally and march on American headquarters to protest the latest bonuses, which are to be paid that day.
"I don’t think there are really that many differences" between the candidates when it comes to confronting management, he said.
Hunter’s opponents have also criticized the union’s progress in the current contract talks, and they have alleged that the labor group’s upper echelons have been distant and detached from the rank and file.
"It’s time to take back the APA," said Pete Oborski, who is running for vice president on a slate with Schricker. "It’s hard to follow the guys who led the retreat into the charge."
