New Jetblue Contract Pending

[8vATE]

Just read your post FNG320....

Just want to make a few points..

First.... I would like to make more money too..
My background is all civilian commercial aviation..
I've been following the airline industry since a teenager...
ALPA for 14 years.... Commuter/Major Freight/Major Pax

You seem to be beating the drum very hard for a raise....

Well...

How much?
What is fair...?

What you say is fair may not be some other guys version of fair....
Historical rates are out the window at this point... yes the EMB rates are
low.... So are the 320 rates....

You talk about longevity raises, inflation, profit margins....

This ISN'T the military dude.... cost of living adjustments are not
voted on by Congress....
and yes I realize profitsharing here isn't truly profitsharing.... but it is YOUR cash... and that a lot of guys are way underwater on the options.. that unfortunately is the nature of stock options....

BUT....

You're falling in to the old trap that everyone before you has....
YOU think you're running the company... You think YOU know what is a fair wage....

May I suggest that you take a deep breath....
Evaluate where you are...... YOU chose to come to a new LCC.....
YOU knew what the pay was when you were hired...
If you are truly unhappy... as you seem... fire up those apps....

Do I believe Al blew it when he tied JB rates to SWA.... Yes..
A 5 year SWA Captain in 2000 was making about 127/hr...
A 5 year SWA Captain in 2006 will be making about 180/hr...
They are a 33 year old airline and have almost 400 a/c....
THEY paid VERY low wages for the first 30 years.....

If you knew ANYTHING about this industry..... the history of it....
You would realize that being conversative is GOOD...
15% profit margins are indeed unheard of in the airline business.... so YOU want to go to 3-8% like SWA..... do you realize that this company is 3 years old...?
Everyone is gunning for us..... We indeed could be a flash in the pan...
This company has huge capital expenditures in the pipeline....

Why don't you let our leadership run the company....?
I believe rates will go up.... Probably never enough for you... but it will take more than this little work agreement debacle to break my trust in the company.....

I know you're pissed ...
But it seems like you really don't understand this industry... the history....
how jetBlue fits in to the industry as it stands right now....

May I suggest FDX.....?

 

[FNG320]

More/replies

I knew my comments would jar a few loose. Lets talk about what is reasonable.

First, the communications from management has all but stopped. Right now they are reacting to our dislike of the contract/agreement. They expected us to either not pay attention or act like lemmings.

Second, I have no doubt that Dave and David have a great plan for JBLU and the future of the company. But what has happened to Al? He has gone off the edge into the deep end and now sounds like the CEO of AA, UAL, DAL. etc in his dealings with the pilot group? I really think he has lost touch with us. I get the impression he doesn’t even want to listen to our complaints any more. He gets defensive and shuts down. His ability to communicate and relate with the pilots is gone. He’s a pilot too, but I think the upgrade to VP/Senior VP came with a lobotomy (plus they may have removed his spine also, is there an xray in the house).

Third, Initially matching our pay to SWA was a good idea, until SWA got their outrageous raise in this latest contract. So tell us why it is outrageous, then give us some sort of raise that fits JBLU. I’m not looking for a big 30-40% raise. I’m not looking to kill the golden goose. However I am looking to maintain my pay level with inflation. I really think a simple 3% raise to correct the almost 6% in loss so far would have been a great token to the pilot group showing that they are aware of our needs and willing to make the effort. A simple 3% raise would have unified the entire pilot group into signing the agreement and ready to follow Dave and David off the cliff (yes, me too). But they didn’t do that.

Fourth, How about a plan. Dave and David, plus all of the smart guys at the top have planned the whole thing out in the future. I have confidence that they know exactly where we are going and how we will do when we get there. If they plan in the raises now they can work the issue/cost for the future along with their future "big capital expenditures". They should plan on it, vs wait and see what we can give after the fact. Because there will always never be enough. Come on, don’t tell me they can’t figure out how much of a raise they can give us and when it will occur over the next couple of years. They don’t even have to make it binding, but tell us that the plan (hopefully to match inflation every year for the next few years at least). More would be better, but I’m not asking for more, just enough to keep us at the same purchasing power we were when we started, and something to look forward to. 3 to 5% inflation per year will eventually make the pay we earn right now, insufficient to put food on the table. Hey, what happens if Kerry gets elected and taxes go up and inflation goes above 5%? Oh by the way, I agree it isn’t the military. But the military even with decreasing budgets we still got annual cost of living raises (inflation). Sometimes it was even inflation –1%. But hey, it was something to try and keep us at the same buying power.

Fifth, Hey, there are also other ways to help that don’t involve pay. What about making some/all of the profit sharing income vs 401K (doesn’t cost JB nearly as much as a big raise). What about fixing the strike price for the options so that the entire pilot group is above water. (Oh, that may be unfair to the old guys prior to the IPO who have prices in the pennies). But yours are already worth something anyway, right. A lot of guys’ options are worth nothing right now. Let them catch up. How about just setting everyone’s price the same as the pre IPO price you old guys have? That is direct future compensation that for now cost the company nothing right now. Wouldn’t that bring the pilot group together and unite us by treating us all the same. (Unless there is an old guy vs new guy problem).

We all need to think about this. Growth of JBLU is good for all of us, but not growth at our expense. We should also share in the growth (or at least tread water, vs sink). There are pilots at both ends of the spectrum. Those that go along with the status quo forever, to those that want outrageous pay till the company folds (plus a union to make it happen). Hey, I not either extreme. I feel I'm in the middle of the pack (however, just willing to say what I think, a lemming with a voice). Okay, enough for this session, time to let the keyboard cool off again.

 

[Dizel8]

Do not have the time to write much, but have to ask: How does the company "fix" the strike price on options?

 

[Dave Benjamin]

It amazes me how everyone thinks the JetBlue pilots "got hosed" with the new contract rates on the EMB190.

The marketplace has changed. The high salaries are gone. Look how the Legacy carriers are collapsing. No one seemed to mind when natural market forces pushed wages up, now when natural market forces are pushing wages down, the sky is falling.

Face it, people are only going to pay X level for an airline ticket, just like most of you will only pay $1.78 for your SpeedStick at Wal Mart.

This business has for ever changed. Now what we should try for as employees is profit sharing and higher 401K matches.

Hello McFly!
They did get hosed. Sub-RJ rates for 100 seat airplanes is pathetic. Fortunately I hear that plan has been withdrawn. JetBlue is very profitable. Paying a reasonable rate for the E-190's is not going to bankrupt the company. What it might mean is that someone in upper managment will have to settle for a modest vacation home in the Caymans with one servant rather than a large villa with a staff.

 

[V2+10]

FNG

Obviously you have some issues. However, why in the world are you airing your laundry here on a web board for crying out loud! If you have concernes, sack up and have the stones to speak directly to Dave, David, or Al. Maybe even the values commitee. I'll bet $ that you have not had a one-on-one conversation with these folks. Tell THEM all the things that you have just told us here at Flight Info. They might not be able to change things to YOUR satisfaction, but they do care and they will listen. The rest of the industry cannot fix your concerns. Go to the people that can.

V2

 

[Dennis Miller]

..... do you realize that this company is 3 years old...?
Everyone is gunning for us.....

But unlike any other startup in history you have the effects of 9/11 and the worst downward spiral, to nurture without too much competition from others. As many other startups were pummeled like J.J. Bullock at Daytona Biker Week, you have had the sumptuousness of seeing airlines deal with their own survival, without the opportunity to end yours. Your "15% profit margins are indeed unheard of in the airline business" is great news in this business, as long as it is not coming at the expenditure of your pilots.

 

[FNG320]

Thanks....?

FNG

Obviously you have some issues. However, why in the world are you airing your laundry here on a web board for crying out loud! If you have concernes, sack up and have the stones to speak directly to Dave, David, or Al. Maybe even the values commitee. I'll bet $ that you have not had a one-on-one conversation with these folks. Tell THEM all the things that you have just told us here at Flight Info. They might not be able to change things to YOUR satisfaction, but they do care and they will listen. The rest of the industry cannot fix your concerns. Go to the people that can.

V2

Hey guy, of course I have a few issues. And you should too. What make you think I haven't already tried communicating with management? They just don't want to listen. You just get the touchy/feelie "thanks for your concern" back. The best that has happened was the "agreement" was revoked. Not much of a change, just not quite as bad. We stay at bad, vs going to worse. But maybe if some of the lemmings will listen and also communicate then maybe something will get done. Hey, sometime you just have to hang our the dirty stuff in the sunlight to get out the stains. Hey, if the senior 100-200 pilots (those who have been here through the whole thing) went to them, then maybe they would listen. But who in management is going to listen to the lone lemming named FNG.

"Thanks for your concern".... Sound familiar.....

 

[Boeingman]

Hey guy, of course I have a few issues. And you should too. What make you think I haven't already tried communicating with management? They just don't want to listen. You just get the touchy/feelie "thanks for your concern" back. The best that has happened was the "agreement" was revoked. Not much of a change, just not quite as bad. We stay at bad, vs going to worse. But maybe if some of the lemmings will listen and also communicate then maybe something will get done. Hey, sometime you just have to hang our the dirty stuff in the sunlight to get out the stains. Hey, if the senior 100-200 pilots (those who have been here through the whole thing) went to them, then maybe they would listen. But who in management is going to listen to the lone lemming named FNG.

"Thanks for your concern".... Sound familiar.....

Sounds like things are getting testy in Blue Aide land.

 

[AKAAB]

What's Legal?

As I understand it, there are some legalities that hamper the ability to fix some of the problems being raised. It might look like they can waive a magic wand and make all the changes we want, but they have to do it within the SEC regulations and laws of the land.

The profit sharing plan, legally, can either be one way or the other - cash or deferred plan (401k). You can't have it both ways - with the exception of the first year (50/50). I'm one of the senior guys that thanks the universe for the divine intervention that sent me to JetBlue. When I was hired, I understood the profit sharing plan was supposed to be an additional source of income, not an additional source of retirement funds. The plan changed before it was even written in ink because of D2's desire to provide the best long-term benefit to the majority of employees. The ugly truth is that there are a lot of workers that will never save a penny toward retirement. It's a bit of social engineering that I wish we could get a choice on.

There are very strict laws on pricing options. They would love to adjust everyone's option prices, but again, there are huge legal hurdles in the way. I don't profess to know all the intricate ways of manipulating the options, but they have clearly said that if they could fix it, they would, and they are still looking for ways to address it.

I wonder if they could offer an option cash-in/exchange? Could you trade in your deeply underwater options and get new options reissued at the current price, but with a resetting of the vesting schedule? You'd lose the benefit of any shares already being vested, but would get back in the money. But then again, what happens if the stock goes down again? Any legal experts out there?

AKAAB

 

[ShaggyF16]

"FNG" for a reason...?

Hey, if the senior 100-200 pilots (those who have been here through the whole thing) went to them, then maybe they would listen. But who in management is going to listen to the lone lemming named FNG.

Ya' just don't get it, do ya'? I'm sure they listened to you. Just because our very capable leadership, Al included, disagrees with you doesn't make them wrong and you right. I tend to believe we do indeed have a plan for the future. You may not yet be privy to the details, but I'll put my trust with the seasoned guys who got us off the ground and steered us to double-digit profits through 9-11 and the internet bubble (as opposed to the guy who has been around a few months and suddenly thinks he has all the answers).

- I don't recall seeing a "cost of living increase" in the contract I freely signed. BTW my contract is identical to yours.

- Lots of aviators would kill to be in your shoes right now. If you're concerned about your stock options being underwater, relax. The exercise deadline is 10 years hence for a good reason. Let's worry about them in 20, and hope we still have a company (and stock) to talk about. Our leadership is taking the long-term view here (thankfully). So should you.

- I, for one am truly thankful we have leadership that is more concerned with the long-term survival and profitability of this company than they are with feathering their own nests. That is way outside the norm for this industry.

- No action exists in a vacuum. Raise pay for one group and you'll likely have to raise it for all. That shrinks profit sharing, which acts as a cushion in lean times. You yourself stated "what happens in a downturn when I don't get any profit sharing"? If we have a cushion, we can avoid pay cuts, furloughs and the like standard at the other airlines.

- Think we can just magically raise fares and solve all these wonderful concerns? Ask the boyz at the majors how that works. We would likely see our traffic fall off precipitously, cut deeply into our profits, freeze our growth, etc. Sound rosy?

- We have the good fortune to upgrade in record time. Our pay is at or above SWA's previous contract. Let's see what kind of profit margin our good brothers there can pull down after their nice pay raises before we go experimenting with our business model profitability.

- Sure there may be room for some minor adjustments here and there, but make no mistake: We are fighting for our lives in an absolutely unforgiving marketplace. The other airlines want us GONE!

- Everyone is entitled to an opinion. However, you might want to inform yourself a little better RE: SEC rules for stock options, our own operating margins in certain VERY competive markets, future growth plans before adding your contribution to the internal or external debate.

- Al has most certainly not had a "lobotomy". What he does have is years of experience in the airline industry (after serving his country flying Skyraiders, BTW).

8vAte hit all the nails right on their craniums.

I'm all for passionate, eloquent discussion. I just prefer it to be a little better informed.

For those concerned with perceived "turmoil" at JB, I am only seeing/hearing rumblings from a very small, but vocal minority. Maybe they never bought into the Kool-Aid in the first place. Most of us think it is a great place to fly.

FNG, I sincerely hope you can find some resolution on all these fronts without joining the ranks of the few who would choose to convert this great company into something more familiar to them. IE: a divisive, angry and counterproductive place to try and collect a paycheck.

I'm having a great time here, and I wish you all the best.

Just one guy's opinion from the middle of the seniority pile.

Shaggy

 

[FNG320]

Ya' just don't get it, do ya'? I'm sure they listened to you. Just because our very capable leadership, Al included, disagrees with you doesn't make them wrong and you right. I tend to believe we do indeed have a plan for the future. You may not yet be privy to the details, but I'll put my trust with the seasoned guys who got us off the ground and steered us to double-digit profits through 9-11 and the internet bubble (as opposed to the guy who has been around a few months and suddenly thinks he has all the answers).

- I don't recall seeing a "cost of living increase" in the contract I freely signed. BTW my contract is identical to yours.

- Lots of aviators would kill to be in your shoes right now. If you're concerned about your stock options being underwater, relax. The exercise deadline is 10 years hence for a good reason. Let's worry about them in 20, and hope we still have a company (and stock) to talk about. Our leadership is taking the long-term view here (thankfully). So should you.

- I, for one am truly thankful we have leadership that is more concerned with the long-term survival and profitability of this company than they are with feathering their own nests. That is way outside the norm for this industry.

- No action exists in a vacuum. Raise pay for one group and you'll likely have to raise it for all. That shrinks profit sharing, which acts as a cushion in lean times. You yourself stated "what happens in a downturn when I don't get any profit sharing"? If we have a cushion, we can avoid pay cuts, furloughs and the like standard at the other airlines.

- Think we can just magically raise fares and solve all these wonderful concerns? Ask the boyz at the majors how that works. We would likely see our traffic fall off precipitously, cut deeply into our profits, freeze our growth, etc. Sound rosy?

- We have the good fortune to upgrade in record time. Our pay is at or above SWA's previous contract. Let's see what kind of profit margin our good brothers there can pull down after their nice pay raises before we go experimenting with our business model profitability.

- Sure there may be room for some minor adjustments here and there, but make no mistake: We are fighting for our lives in an absolutely unforgiving marketplace. The other airlines want us GONE!

- Everyone is entitled to an opinion. However, you might want to inform yourself a little better RE: SEC rules for stock options, our own operating margins in certain VERY competive markets, future growth plans before adding your contribution to the internal or external debate.

- Al has most certainly not had a "lobotomy". What he does have is years of experience in the airline industry (after serving his country flying Skyraiders, BTW).

8vAte hit all the nails right on their craniums.

I'm all for passionate, eloquent discussion. I just prefer it to be a little better informed.

For those concerned with perceived "turmoil" at JB, I am only seeing/hearing rumblings from a very small, but vocal minority. Maybe they never bought into the Kool-Aid in the first place. Most of us think it is a great place to fly.

FNG, I sincerely hope you can find some resolution on all these fronts without joining the ranks of the few who would choose to convert this great company into something more familiar to them. IE: a divisive, angry and counterproductive place to try and collect a paycheck.

I'm having a great time here, and I wish you all the best.

Just one guy's opinion from the middle of the seniority pile.

Shaggy

Shaggy,

You are 100% correct on just about everything you say. However, there is more to a contract than the paper and ink it is written with. There are the expectations that came with the job.

First I agree that the guys with the big brains know what they are doing. However, they use to keep us informed with what is going to happen not only tomorrow, but over the next 6-12 months. It isn't happening any more.

Second, Yes, there is no cost of living increase in the contract. But the "expectations" were that "we will take care of you" just is not happening. I agree that the promise of matching SWA payscale in some form was too agressive based on SWA's latest contract. However, some portion of that should have been given to us with with an explanation. The promisie of a matching pay rasise it the cost of living increase we are all talking about. If they can promise one thing but then break that promise, what is next?

Third, we are not talking about lots of $$$. Even just the cost of inflation for a cost of living raise for all work groups is deserved. Do you think that a three percent raise would break the bank. I don't think so. It would most likely drop the margin from 14% to 12%, and our profit sharing would go down, but at least I can help pay the bill with the 3% not the 401K. Paying for the raise is one of those issue that will go on forever. However, most financial planners say that if you want to save money, you need to pay yourself first. If you wait till all the bills are paid, you will never save anything. Right now, the management is looking at what is left and saying "no raise", but if the put it in the system and were forced to work it in. I would bet that in the end there would be money for the raise. Do you think if they raised the faires $1.00 per ticket our load factor would drop? I don't think so. Customer loyality would survive the $1.00 raise and then the $1.00 would pay for every employee a cost of living raise. Yes the majors have done it wrong. But we are going to the opposite extreme. Do we need to raise the ticket prices to give a cost of living raise, no. The funds are there. They just need to use some of the profit margin to help. Hey, where's the caring? Where's the trust (oh, that just got set aside already"

You know, I don't know the SEC rules, but I would bet that there are ways to do what I suggested in some form or another. That is what the big guys up at Forrest Hills can figure out. Heh, but they need to do something. Even a token would be enough to quell the talk. Remember, 75% of the company was not here before the current pay scale. You mention turmoil at JBLU. Well it is there. It is not big posters on the wall, with union meetings taking place around town. But it is there. It is the small discussion about all of these issues. It is the undercurrent that is washing away the foundation. The disappointment with management and the new contact, the way it was presented, the EMB-190 payscale, the lack of a raise (in any form), the total lack of proactive communication. Management has to fix this, not us.

In the end, do I want to be anywhere else? No. If told expect no raise for 5 more years would I leave? No. Do I trust our leadership to do the right thing? Not as much as did before. Do I need to make as much as the other majors? No. Will I keep working as hard as ever for JBLU even with out the changes? You bet.

I guess it is time to drop this whole thing for now. We are all just restating the same facts back at each other. Those who support the status quo won't be persuaded. And those of us that feel we have been let down will still feel the same way. But we all must be sure to look at the facts before us; what has is in writing, but also what has been promised before you and I close our eyes. We all have our own opinions. That is the USA.

Good luck to us all.

 

[SpeedBird]

Great post Shaggy!

A couple of other thoughts I'd like to add to yours.

1.) Stock Options: Stock options which the first 200 pilots received served as a stronger incentive to attract the highest caliber pilots possible while the industry at large was still in a hiring mode back in 2000 and early 2001. The level of risk for accepting employment at jetblue during the first year of operations was much higher than it is today for a new hire. The greater the risk then the greater the reward incentive should be. As it stands it is okay with me since they have in a sense served as the early trailblazers for the company and thus deserve something for their efforts that others following behind might not have shared in fully. It is still way too early to classify yourself as a "have-not" in regard to stock options.

As Shaggy so eloquently stated these options and their vesting schedule are not to be looked at based on the current swings in the stock market but are designed as an "incentive" for employees to stick with the airline for a few years and contribute to its long-term financial success not just as an employee, but also as a shareholder. For those who have only been with the company for a year or two please have some patience and understand that there is a lot of time for you to gain a financial windfall from your ISOs, provided you don't try and choke the goose before then.

2.) Contract Expectations: Once again if you don't like the current agreement because it falls way short of your expectations perhaps there is nobody else to blame but yourself. The comments made by some people here would make one believe that jetBlue has been in business for decades and thus should provide all the same benefits, work rules, and other related pay issues as other airlines of comparable experience. Let's not forget that this sirline has only been in business for a little more than four years! NOBODY has been on this property has been here long enough to be complaining loudly about how tough their professional lives are and expect much sympathy yet.

People need to have a better understanding of where this airline is and maintain some patience with its progress, and when you can expect to get your goodie bag filled up. This airline demands that its employees have some vision and enough gray matter to understand the economic and competitive drivers that this industry is facing, including jetBlue. While some may think that a 10-15% profit margin automatically qualifies them for more money; it is critical that the airline show as much profitability as possible in order to obtain the maximum capital possible when jetBlue goes shopping for new debt instruments. The amount of capital jetBlue can receives is directly proportional to how much available working capital is on hand in any given quarter. This is the life blood of a young growing airline that is competing for its very existence with no guarantees of long-term success. If you listened closely to Dave Barger he made this point very clearly during the pocket sessions and it should not be a great leap of critical thought processing to figure this out.

So FNG you want more pay, higher stock valuations, and more profit sharing.....don't we all! But just because you want it on your terms doesn't mean that is the only road to obtaining it, and thus everyone else who doesn't agree with you is wrong or suspect of not being true to jetBlue's culture and your long-term best interests as a member of jetblue's team. I appreciate your concerns and I want the same thing as you, but I just have a different view on how to get it. Some advice for you is to ignore the inputs of the many jetBlue outsiders who don't have your best interests at heart and love nothing more than to see us squabble and drop to their level of professional frustration. It is popular for everyone to call jetblue pilots a bunch of Kool-aid drinkers, but in the end everyone drinks their own flavor of Kool-Aid...if you know what I mean.

3.) Understand that jetBlue senior management is conservative where it counts most and they must be responsible to several masters of which the pilots represent just one portion. While you may believe that D3 and Al Spain are not being honest, or forthright with the pilots, my experience with them does not support your position. In the case of Al Spain he went out of his way to help me early in my jetBlue tenure when he didn't have to, and it made a considerable impression upon me about his character. He is one sharp dude and we'd all be lucky to have his brains and work ethic. Of course he's still a member of the human race and makes his share of mistakes just like you and me but for now I'll withold my harsh judgment of him and anyone else in the management suite in Forest Hills.

4.) jetblue crewmembers need to just get a hold of their emotional positions and remain patient with themselves and those who are charged to manage the airline's strategic plans and operations. I suspect the next couple of years will be pivotal to jetblue's long-term plans and goals. If the flying gods continue to smile on jetblue you and I will not be disappointed...just hang in there for a little longer and remember how wet behind the ears we all still are.

 

[V2+10]

FNG

Your opinions are valid because YOU believe in them. That's your right. Not everyone will agree with you, but it is your right nonetheless. It's easy to spout off about delicate subjects on a web board due to the anonymity of it. A safe place to vent if you will. With that being said, I still do not believe for one second that you have had a face to face discussion with the upper powers at JB using the SAME vocal tenacity that you portray here at Flight Info. You just might find it a better place to voice your concerns. Try it...I think you will find that they will most likely still renew your contract anyway.

V2