MESA TA Question

[WileE]

From ALPA (LONG!!)

Just to throw another log on the fire. The latest FAQ on the TA from the ALPA folks. This is long and in 3 parts, but if you want to keep arguing pro or con, at least read the whole thing.


WHY DID WE ACCEPT THIS TA?

This proposal was presented as a “Package” proposal by the Company on January 21, 2003. Such “package” deals are fairly common in labor negotiations. The proposal included the ALPA Scope clause (Section One), plus the six previously TA’d sections, plus eighteen other sections (all of which had been previously discussed at the bargaining table with the management representatives). Taken as a whole, this proposal reflected a number of incremental work rule improvements over the current contract, plus Scope. The National Mediation Board Deputy Chief of Staff witnessed this offer. Your Negotiating Committee immediately requested a private caucus to consider this proposal. After a thorough discussion, your Negotiating Committee unanimously agreed to accept this proposal. Since this is a “package” agreement, if either party attempted to make adjustments or to re-negotiate individual provisions of the agreement, the other party would be free to do likewise, or to simply claim that the agreement is void.




If JO can shut down the airline what is going to stop him from shutting down the airline whenever it suits him? Why are we really bothering with a contract?

In many ways, Scope is truly the most important section of the Collective Bargaining Agreement: it defines what work is covered by the CBA, and who will perform that work. The lack of Scope protections in our current CBA has allowed management to “whipsaw” CCAir against Mesa pilots, and has allowed management to create Freedom Airlines. The best work rules and wage rates in the world mean little if the work can be transferred to other entities and workers. Pilots at other carriers are seeing the same tactics used against them: Mesaba (with their holding company’s acquisition of Big Sky Airlines); Chautauqua (with their holding company’s acquisition of the old Republic Airlines certificate); etc.



If JO could shut down the airline, why has he spent all this time and money with us at a bargaining table?

In the months since negotiations began in March of 2002, Freedom Airlines has gone from a business plan to an operating entity with (currently) nine aircraft in revenue service. Freedom is scheduled to have 16 aircraft in revenue service by June 18. The Company strategy was simply to try to “buy time” to get Freedom into operation. Management felt that the presence of Freedom reduced ALPA’s negotiating leverage.




What is to stop JO from going to court and asking for more concessions with this contact in the future?

Upon ratification, this agreement will be legally binding upon both ALPA and the Company. Currently US Airways is utilizing the bankruptcy court to revise and amend it labor agreements…but a bankruptcy filing is a drastic step. It would jeopardize (and possibly eliminate) the value of Mesa Air Group stock and such a bankruptcy filing would undoubtedly only be considered in the most dire financial circumstances. Keep in mind that Mesa management has huge stock holdings in Mesa stock which could be wiped out by a bankruptcy filing.

What is to stop JO from starting a totally different airline under a totally different Corp. and shut down Mesa?

The Scope language we have covers MAG, the Mesa Air Group holding company. However there are lawyers who make career out of circumventing scope. From a purely collective bargaining standpoint, we cannot prevent JO from using his personal funds to buy stock in Southwest or Jet Blue, or any other company. However, the Scope clause prevents the use of Mesa Air Group assets—aircraft, operating certificates, managerial/staff talent, routes, codeshare agreements, etc.—from being utilized to create an “alter ego” airline to circumvent this collective bargaining agreement. Also, there may be practical restraints to limit such action: employment agreements with MAG preventing senior management from working for a competitor, MAG shareholders (including large institutional shareholders) who might assert legal claims of breach of fiduciary duty if key Mesa Air Group staff were to invest in, advise or simultaneously commence work for a competitor; and so forth. Keep in mind that external events can impact Scope, too: US Airways had a highly-evolved Scope clause, but as a result of that Company’s financial condition, its pilots—represented by ALPA—agreed to modify that Scope clause to allow more small jets. The important point: they negotiated that Scope relief at the bargaining table—it was not unilateral action by the Company.





What was entailed in the deadline that was so pressing, and was it confirmed, and how? Apparently the NC feels the threat is real. Why more so now than any of his threats before?

We had what we consider to be credible information that US Airways was putting pressure on the Company for J4J. We knew that Freedom was scheduled to have about 16 aircraft in service by June of this year. We knew that the Company had discussed with America West the option of them paying Mesa to withdraw a large number of 200’s from their operation. We knew that the Company had been in discussion with other carriers about using those aircraft for J4J. We knew that he Company had been considering the sale of AMW and/or returning the Beeches to Raytheon, or leasing them to another carrier. We knew that with current staffing the Company could furlough initially up to 200 Pilots and was prepared to do so. Our evaluation was based upon consideration of information from numerous sources throughout the airline industry (both labor and management). Our ALPA staff advisors, in particular, made extensive inquiries to verify information. In short, we based our decision upon what we considered to be credible information. We did not simply take management’s statements at face value.



It was already apparent that the company was already replacing your flying in PHX with Freedom flying with every aircraft delivery. Secondly a number of ERJ’s were already parked and it was evident to us that the company was not going to keep aircraft parked that could no longer be in service.





Is this Tentative Agreement concessionary?

This is not “just the Company’s proposal”. We have six sections that were previously agreed to. It is our Scope provision, without a single change. Other sections of the agreement reflect improvements that your Negotiating Committee had sought at the bargaining table. There are changes in several sections that are more restrictive to the Pilots than the current contract. However the TA as whole agreement is an improvement. As previously discussed the biggest improvement is in Scope. It is difficult to appreciate the value of Scope until it is needed. It has never been more important than it is right now . At a time when most other carriers are engaged in concessionary bargaining, we have achieved at least some improvements in working conditions and work rules.



The Implementation Agreement secured additional benefits for all Mesa Air Group pilots.





What's different in this case that would facilitate Mesa's simply shutting down and/or transferring all the assets?

The Scope clause in our current CBA binds only Mesa Airlines, not Mesa Air Group. Nothing prevents Mesa Air Group from shrinking Mesa Airlines and growing another entity (such as Freedom).

.



Do the equipment commitments begin with training events that occur after the TA is ratified or are they retroactive. For example, I am an ERJ captain and I want to bid the 700. Do I have to 36 months from my ERJ upgrade or can I get it whenever my seniority will hold it?

There is no retroactive application of the equipment commitments. In other words, all training events that occurred under the old contract would continue to have the same commitments. The new commitments will apply ONLY to those training events that occur AFTER the new contract becomes effective.

 

[WileE]

Part II

What is the equipment commitment as it would be applied under the tentative agreement?

Under the tentative agreement, there is no seat lock, only an equipment commitment. If you become a captain under the ratified agreement, then you have further restrictions. ERJ captains can go to the CRJ, but a CRJ captain cannot go to the ERJ. BE1900 captains can go to the ERJ, wait for 36 months, and then go to the CRJ.





What is the status of the federal lawsuit and the single carrier filing.

The federal lawsuit in the United States District Court for the District of Arizona is still on the docket. Keep in mind that the legal process is very lengthy and we can not speculate on what the timeline would be for concluding the lawsuit. Additionally, understand that the lawsuit is only seeking an order from the court directing Mesa Air Group management to bargain in good faith. This means that even if ALPA wins the suit, Freedom Airlines isn’t automatically shut down and the flying isn’t transferred to the Mesa pilots. If the tentative agreement is ratified, the lawsuit will be dropped.



As for the single carrier filing, the National Mediation Board is still investigating ALPA’s petition to have Freedom Airlines declared a single transportation system along with Mesa Airlines/Air Midwest/CCAir. Although ALPA had been trying to get the NMB to make a ruling on the petition, we do not know the timeline of when the Board will make a decision. Even if the NMB rules favorably and finds that Freedom Airlines and the other Mesa Air Group carriers are a “single transportation system” for collective bargaining purposes, this does force a single contract for all the pilots. We would still have to negotiate a new collective bargaining agreement. If the tentative agreement is ratified, the issue becomes moot.



Keep in mind, through the Implementation Agreement we have secured far more than we would have secured simply by winning the lawsuit and prevailing in the single carrier case. Under the terms of the Implementation Agreement, the parties will stipulate to the single carrier determination ; Freedom Airlines recognizes ALPA; and MAG acknowledges that the TA (upon ratification) will become the CBA for all MAG airline operations (including Freedom).





What happens to Freedom pilots if the tentative agreement is ratified? Are there any consequences to pilots who went to Freedom Airlines to the detriment of the Mesa pilots.

Freedom Airlines Pilots hired “off the street” will be added to the bottom of the integrated Mesa seniority list — below all current Mesa/Air Midwest/CCAir pilots. Pilots who transferred to Freedom Airlines from Mesa (on a Mesa “leave of absence”) will retain their Mesa seniority number.



The Implementation Agreement provides for a “bump and flush” policy of replacing the current Freedom Airlines pilots with the “correct” Mesa pilots (those Mesa/Air Midwest/CCAir pilots who have the seniority to hold the 700/900 positions). The agreement includes a strong financial incentive for management to replace the Freedom Airlines pilots with the correct pilots as quickly as possible. This incentive is through pay protections for those pilots who should be flying the larger aircraft. Pilots who are senior enough to have been awarded a CRJ-700/900 Captain seat will be “pay protected” on a “one for one” basis—so long as one “junior” pilot remains in the CRJ-700/900, one Mesa pilot will be “pay protected”.




What’s in the contract for the BE1900 pilots?

The tentative agreement provides for some incremental improvements in quality-of-life areas that will benefit all Mesa Air Group pilots. These improvements include the Call Me First, Call Me Last reserve scheduling provisions, Right to refuse a recall provision in the event of another furlough, additional year of longevity, no rate reductions for BE1900 pilots, and no suspension without pay pending investigation. Additionally, the tentative agreement provides scope and job security provisions, as well as the potential for all Mesa Air Group pilots to benefit from the tremendous growth and expansion opportunities currently planned by the Company.





I am extremely disappointed that the contract doesn’t include many of the compensation and quality-of-life provisions that our Negotiating Committee was trying to obtain in our new contract. Can we have the Negotiating Committee continue to try to get some of these provisions?

Not at this time: the tentative agreement was presented by management as a “package”. They stated they would not consider section-by-section changes to the package. We can’t re-negotiate piecemeal improvements in the TA at this time. However, nothing prevents the parties from modifying the CBA during the term of the agreement via Letters of Agreement.



If we do reject the tentative agreement and restart contract negotiations, what is the likelihood that the National Mediation Board would release us into a cooling-off period?

Again, we cannot speculate on the actions of the NMB. Mesa Air Group provides critical feed to US Airways and America West, both of which are teetering on financial ruin. We need to recognize the political reality — the possibility that we simply wouldn’t be allowed to strike during these uncertain economic times. In addition, keep in mind that US Airways has been approved for an ATSB loan upon emergence from bankruptcy (scheduled for March 31, 2003); and America West has already received an ATSB loan. Between them, they will represent over $1 billion in ATSB loans. The practical reality is that we cannot ignore the impact those ATSB loans might have on the NMB’s decision-making process. The most likely scenario following a failed TA would be that the NMB would schedule additional mediated negotiations. When such negotiations would resume, and how long they would continue, is purely speculative.




How many votes will be needed to ratify the tentative agreement?

The vote is by a simple majority. Fifty percent plus one vote of the votes cast is needed to reject or accept the agreement. Active members in good standing, grievance pending members, and executive active members are eligible to participate in the balloting. Management pilots (executive inactive) and pilots on a leave of absence are not eligible to vote.





What will be the status of the furloughed US Airways mainline pilots flying at Mesa under the Jets-For-Jobs protocol?

These pilots would be Mesa Air Group pilots flying under all of the terms and conditions of Mesa agreement with one exception, Filling of Vacancies. US Airways pilots will have the right to 50% of the Jet seats (Captain & First Officer) created by J4J. While flying for Mesa, they would not have to resign their mainline seniority numbers. These US Airways furloughees may only bid openings created by US Airways codeshare flying on the jets. They may not bid to BE1900 or Dash-8 positions. In addition, they will bid as per their Mesa seniority, based upon their Mesa date of hire. They will be junior to all Mesa pilots currently on the seniority list. As a practical matter, they will be on reserve for a significant period of time.

 

[WileE]

Part III

US Airways furloughees flying for Mesa as Captains under the J4J program will be paid at first-year Captain rates; US Airways furloughees flying for Mesa as First Officers under the J4J program will be paid at the highest First Officer rate in that equipment.



In all other respects, the US Airways furloughees will be subject to all Mesa contractual provisions. They will bid as per their Mesa seniority, based upon their Mesa date of hire. They will be junior to all Mesa pilots currently on the seniority list.





What happens to these US Airways furloughees in the case of furloughs at Mesa?

That depends upon which aircraft are overstaffed.

Keep in mind that under the J4J agreement, US Airways furloughees are entitled to 50% of the jet seats they bring to Mesa, above the 32 aircraft currently permitted under the codeshare agreements.



Scenario One: America West ceases operation, and all aircraft under the America West codeshare are parked. US Airways continues operations.

Under this scenario, Mesa pilots would be furloughed but the US Airways furloughed

Pilots would continue working under the J4J program, as it was not affected.



Scenario Two: US Airways ceases all operations. America West continues operations.

Under this scenario, J4J ceases. All US Airways codeshare aircraft are parked.

In this case, US Airways furloughees would be subject to all provisions of the Mesa CBA with regard to furlough. Bottom line: they would be subject to furlough in accordance with their Mesa seniority. Period. Keep in mind that they will be junior to all pilots currently on the Mesa seniority list.


WHAT HAPPENS IF THE TENTATIVE AGREEMENT IS REJECTED BY THE PILOT GROUP?



I. Resumption of Negotiations: If a tentative agreement fails to ratify, the parties may certainly meet in an effort to reach a new Tentative Agreement. At some point, if ratification fails, the National Mediation Board will contact the parties to resume negotiations. WHEN that will happens is not at all certain, and can be influenced by a number of factors—many of which are beyond our control. These factors include the schedule and availability of the mediator.



Some factors that the NMB would use in their assessment could be war, national economy, the financial condition of our code share partners (bankruptcy or ATSB loans) or many other possible factors.



Bottom line: we have no assurance WHEN negotiations will resume.



II. “The deal always Improves After a Rejected TA”: This assumption is most often uttered by pilots with no experience in negotiations. A number of pilot groups in recent years have found out the hard way that this approach is extraordinarily dangerous. It is even more risky in the current airline industry environment.



External events—events over which neither Mesa nor ALPA have any control—could dramatically alter our negotiating position. For example, do we want to be at the table in June or July, in the midst of an Iraq war? In the Gulf War a decade ago, jet fuel prices doubled and leisure travel vanished—nearly bankrupting several carriers



Most experts do not believe the airline industry has hit “bottom” yet. They anticipate further consolidations, further bankruptcies, more layoffs, and further “re-structuring” of labor agreements. In addition to the main-line carriers who have demanded concessions from their pilots, we are now seeing numerous “regional” carriers being forced—by their codeshare partners—to reduce their operating costs (translation: cut labor costs). Witness recent media attention focused on the failure of United to affirm its codeshare agreements in the bankruptcy court: its codeshare partners—ACA, Air Wisconsin and Skywest—will most certainly be pressured by their managements to lower their costs.



In addition: there is no legal requirement that the parties, upon resumption of negotiations, begin negotiations with the failed TA as a starting point or “baseline”. Particularly in the current industry environment, the Company may claim that they cannot commit to the terms of the rejected TA and must, in fact, move “backward” from the rejected TA. There is simply no guarantee that the deal will get better. There is also no assurance it cannot get “worse”.



You can imagine that if the pilots “expect more” in areas like cancellation pay or rates of pay the company may want to trade the job protections or something else presently in this agreement. All the while growing Freedom without us and shrinking at least the America West system with every delivery of a 700 or 900.



The critical issue for Mesa pilots: should you accept this TA, or should you reject it in hopes of getting a better deal at some later point?



II. Impact of A Delay In Finalizing An Agreement: Your Negotiating Committee and MEC have both unanimously concluded that delaying an agreement is not advantageous to the pilot group. The 700 and 900 jets are going to fly—Freedom Airlines will have 16 aircraft in operation by June 18, with one additional aircraft beginning revenue service in July, then a minimum of two additional aircraft per month through next year. Those aircraft will fly. The only issue for the pilot group is whether Mesa pilots will fly them. By virtue of the Implementation Agreement negotiated by your Negotiating Committee, not only has the Freedom flying been captured for Mesa pilots (including CCAir furloughees), but we will see Mesa pilots trained and placed into the large jets and pilots currently in such aircraft who are not senior enough to properly hold it will be removed. Twenty-seven (27) Mesa pilots are currently in training for the 700 and 900 aircraft. Another training class starts March 11, and will be open to bid by all Mesa Air Group pilots.

Here's the last bit.



Meanwhile, other developments have arrived on the horizon. The Company has publicly announced that it is over-staffed by 100-plus pilots. America West Airlines has stated it wishes to eliminate the CRJ-200 (50-seat) jet from its codeshare with Mesa, and replace the aircraft with larger aircraft. The 19-seat Air Midwest operation is (and has been) unprofitable, and Mesa CEO Jonathan Ornstein has publicly (and repeatedly) stated he wishes to get out of the 19-seat operation. EAS subsidies—critical to the financial viability of the B-1900 operation-- have been drastically reduced in President Bush’s proposed budget for next year (from $116 million to $50 million per year). Local communities are being asked to raise the difference via subsidies.



Your Negotiating Committee managed to secure this TA at a time when we believed our negotiating “leverage” was at its peak. Delay puts Mesa pilot jobs at risk.

 

[BoredToDeath]

WileE,

Thats a whole-lota-Kool-aid!!! Sounds like their trying scare you into it "not" inform you.

I'll give you one good reason not to trust your MEC. If indeed the question and answer to follow is written correctly, I would say that your MEC is no better than J.O.

**The question was: What is to stop JO from going to court and asking for more concessions with this contact in the future?**


**The answer as written: Upon ratification, this agreement will be legally binding upon both ALPA and the Company. Currently US Airways is utilizing the bankruptcy court to revise and amend it labor agreements…but a bankruptcy filing is a drastic step. It would jeopardize (and possibly eliminate) the value of Mesa Air Group stock and such a bankruptcy filing would undoubtedly only be considered in the most dire financial circumstances. Keep in mind that Mesa management has huge stock holdings in Mesa stock which could be wiped out by a bankruptcy filing. **


US Airways "did not" use the Bankruptcy Court to ask for concessions or revise any labor contracts. They used the "threat" of Bankruptcy. Concessions were given "before" Bankruptcy. So YES if J.O. sees fit to ask for concessions from your group later on down the road, don't think that just because you have this signed contract that he can't.

 

[Intruder One]

To Wilie:

As you seem to be the expert I will address this to you,I don't see how Freedumb can take over with 8 A/C or 16 by summer as you say.I believe most of his code parterners would drop him if he were that small.Just a thought.

And my other question which I have mention before but no one has answered.......how do you expect CCAir pilots to live on 3yr. pay?Most of them have 10yrs. or more.Do you not think this will be a severe hardship on them.This does not seem the way to thank your ALPA brothers for their support.Would you like to take your family from say 15yr. pay to 3?These people are not kids,they have houses,wives and kids to support(to borrow from another post),they are not fresh out of flight school.This has never been done in the history of ALPA,why was it done now.Thats going to be a fun cockpit when a senior F/O is making more than a 15yr. capt. on 3yr. pay!

 

[dakotaHC8]

Jetscream,

Yeah, Im on the outside looking in, but to me that means objectivity, not ignorance. Plain and simple, this contract is only about being the cheapest. JO was going to get someone to fly for nothing so it might as well be you, right...?

You guys didnt move anything forward, you just traded a few things around. One step forward in one area and two back in another. Not even the average for pay or work rules, but well below it. I still call that cut rate, what would you prefer? Discount, Budget, Economy Class...?

Just call it what it is, and admit that your pilot group is about to do what it is about to do. Stop trying to make yourself feel better by waving the union flag or promising to "fight the good fight" in 7 years, none of that regains any respect for your pilot group.

Im not trying to attack you guys, but Im not going to let you off the hook either. I just had to sound off when someone felt the need to try and paint this as some grand sacrifice for the survival of your company, puh-lease. Your company needs this new contract TO GROW, NOT TO SURVIVE. Your company AND pilot group need this new contract to undercut rivals and gain new flying opportunities, not to become profitable, right...?

But being as this new contract will either hold the rest of the industry back or place you in a position to "harvest" new flying opportunities from nearly every other pilot group in the nation... Don't be surprised when people are less than impressed when they find out who you work/worked for.

If this TA is all you guys are worth, then you are getting exactly what you deserve for voting yes.

Cant argue with that, Right...?

 

[79%N1]

Once again, Great Post Dakota!! Right on the mark! Mesa continues to hold down the rest of the industry.....and will continue to undercut other affiliates to further their aganda.

 

[captjim]

Must read!!!

http://forums.flightinfo.com/showthread.php?s=&threadid=15315

 

[kenai227]

Mesa Vote

When is the mesa vote going to happen?

 

[big dog1]

WileE

How many firm orders do we have for new jets, the reason i ask is ,on another board Jo said upgrade for all current Mesa pilots would be 3 years, the mec said 1-2 at the most , JO said if we could even get finance I thouhgt we were going to have massive growth?