New Jetblue Contract Pending

[Blue Dude]

I just find it curious that a work group calls something a contract when it clearly is not.

It is a contract in every legal sense. It is a binding agreement signed by the participants, with an exchange of legal consideration. It is NOT a collective bargaining agreement. Collective bargaining agreements are employment contracts, but not all employment contracts are collective barganing agreements. This is one such case. I hope that clears that up.

 

[SWAdude]

It is a contract in every legal sense. It is a binding agreement signed by the participants, with an exchange of legal consideration. It is NOT a collective bargaining agreement. Collective bargaining agreements are employment contracts, but not all employment contracts are collective barganing agreements. This is one such case. I hope that clears that up.

I think so. One question. What happens if the company does something that is out of the scope of this binding agreement? Do you have a commitee in place to legally argue a grievance?

SWAdude

 

[SWAdude]

It is a contract in every legal sense. It is a binding agreement signed by the participants, with an exchange of legal consideration. It is NOT a collective bargaining agreement. Collective bargaining agreements are employment contracts, but not all employment contracts are collective barganing agreements. This is one such case. I hope that clears that up.

I guess I actually have two questions. Who are the participants comprised of.

 

[JB Bus Drvr]

Let's get some terminology straight here. It's not a contract but a work agreement. In other words, you fly for us, we, JB mgmt. expect you to perform your duties in this manner and this is what we will do this for you. Much of the wording is the same that some folks send 2.5% of their pay to Herndon, VA to negotiate. The "new agreement" was recinded in a large part, because of the "organized" efforts of the pilot group through an elected committee of pilots who actively solicited comments from the pilot group. No rewrite is in the works, only addendums to the original agreement. ( Like increased pay, per diem, and a simplified paid time off program.) If my fellow JB guys aren't happy about it, call the Values guys. Other than that, things are OK. No Chapt. 11, pay concessions, or any other bad stuff here, and the stock is holding it's own.

 

[Blue Dude]

I think so. One question. What happens if the company does something that is out of the scope of this binding agreement? Do you have a commitee in place to legally argue a grievance?

Yeah we do, in a sense. There is a committee of elected pilots who assist in working through differences. It's sort of a combination pro standards/grievance committee. There's a charter that created the committee that gives them certain powers. The committee has saved at least one pilot's job, and there are a number of others who have been assisted in disciplinary cases and just plain disagreements.

It's not a contract but a work agreement.

That's a distinction without a difference. It is a contract in the legal sense. It's not generally referred to as "the contract" for the same reason this discussion is taking place: most pilots think "contract" and "collective bargaining agreement" are equivalent terms. They are not.

 

[TonyC]

Ask the FDX pilots what Fred was going to do!

I assume you're referring to the threats Mr. Smith made during the last rounds of negotiations?


THERE WAS NO CONTRACT IN PLACE ! !


OF COURSE Mr. Smith could make threats.


THERE WAS NO CONTRACT ! !


The pilots were represented by a Collective Bargaining Agent, but Mr. Smith DID hold most of the cards.


This also does not compare with DAL, AMR, UAL, or UAIR as you imply - - the pilots operate under a CBA, and have representation in the negotiating process, protected by the Railway Labor Act.

This does not compare with JetBlue, where there is no Collective Bargaining Agreement, no Agent, and no RLA protection. Outside of the scant details in the Pilot Employment contract, there is NO protection, and the company indeed holds all the cards. You're pointing fingers in the wrong direction.

 

[FNG320]

New Contract, WTFO...

What was wrong with the contract/agreement (or the even newer one to be reissued in near future with some of the same crap in it)?

First, there was no pay raise to correct the cost of living due to inflation for inflation or for future inflation for pilots and their pay.

The EMB-190 pay scale is well below what we the pilot group think it should be.

Many changes in the wording of the contract that the company (read Al Spain) thought were small issues, but were big issues and to the determent of the pilots.

The management team failed to communicate with the pilot group to insure a good two-way communication prior to the new contracts release.

The management team is inflexible in meeting the needs of the pilot group when it comes to compensation. (they are like my kids, no matter how many times I tell them the facts, they still only see it their way).



Now for some general comments on these contracts. First, there was no pay raise for the pilots. The current pay scale has been in place for almost three years. With inflation, the current pay scale has lost almost 6% of its value, and without a pay raise, there would be a continued and exponential growth in the loss of income. The new contract had no raise for inflation, and no scheduled planned cost of living raises. Yes, pilots have gotten the preplanned longevity pay raises year by year, but those are longevity not cost of living raises (which are different). With the company making large profit margins (large for an airline) it is obvious there is a lack of respect and caring for the employees when we still make a good profit (best in the industry) making it obvious that this margin is being produced at the expense of the employees (no raise means more profits for the company). Every time the issue is brought forward, The VP of Flight Operations (Al Spain) gets all pissed off and defensive and then replies "the market doesn’t support a raise right now, and we have 10,000 applications on file of people who want to work here". I take that statement to say, "We are not going to give you a raise, if you don’t like it here, you can leave". Well Al Spain can take it his way, but the way I see it is "Pay raise, no F… way, I in charge and you will take it or else, if you don’t like it here, then go form a union". It is statements like Al Spain’s that show that they really don’t care about the pilot group as much as they say they do, and are only out for the company. Only recently, management has now taken to describing JetBlue as barely making a profit. That 14% margin is "terrible" when compared to any normal business that expects 20-30 percent margin. Well, this is an airline, and not Wal-Mart. 14% is incredible for an airline and comparison between an airline and any other business is not possible (apples vs hamburger, not even close). Additionally, the past promise of a pay raise based on SWA’s rates has been dismissed as "then vs now" by the Dave Barger. He has routinely said that we should "trust us to take care of you". How can that be done if previously promised raises can be dismissed so easily. In my opinion management has lost the pulse of the pilot group as well as its trust. It is statements like these that show it. Pay has been an issue in every company survey for the last 3 years, but the company ignores the issue, won address it, and has yet to fix the problem.

One of the things that I feel management fails to remember (as well as some JBLU pilots and some of you on this form) is that 75% of the pilots at JetBlue were not here when the company started. We didn’t live through the low pay scales. We started with the current pay scale and that is our baseline, not the old scale. So when you read about how it was in "the old days", well, that was ancient history to 75% of JetBlue pilots. 75% of us started at the current pay scale and have yet to see a raise in up to 3 years in a company that is leading the industry in profit margin. What we have seen, it what counts to us, not what you had to put up with, but what we are putting up with. Lets also not to forget to mention that your stock options are still worth a significant amount (pennies per share to purchase), but only to the pilots hired prior to the company going public. However most of the options held by a majority of pilots are very low in value, if not worthless (under water) right now. Management always preaches "profit sharing" as additional compensation. Well, profit sharing that goes into my 401K plan doesn’t help me pay the rent, or put food on the table. It goes where I can’t touch it. The intent is well meaning, but at times cash in my pocket is what I need to make ends meet. Then also, what happens if there is no profit, we don’t see a penny.

I guess that is enough, time to get off my small underpaid soap box. There is more, but time to let my keyboard cool off.

 

[a320drivr]

Yee fukking haa!!! That was a geat post FNG. You hit the nail on the head.

 

[iflynights]

Very well said (despite spelling and grammar!!). Seriously, I agree with you 100%.

 

[V2+10]

FNG

It seems that you may have chosen the wrong job. Consider however a few points.

It's obvious that you think that the company should fork over more money into your pocket considering the current state of profits. Just for a moment however, let's ask the pilots at United how they feel about the current round of pay cuts (we all remember how to "choke the golden goose"). What about the fine folks over at Delta that are faced with double digit pay cuts? Do not ever forget that all of those negotiated pay rates were agreed upon at a time when economics at those airlines were good. We all are very much aware that is now not the case.

Remember this, trust is hard to gain but very easy to loose. JB mgt is very aware of this. Ask the folks at United or Delta how they feel about taking major pay cuts. It's no fun. The best way to absolutely destroy trust is to start asking your employees for concessions. While in your opinion JB is not paying its due amount, consider the alternative.

JB is trying very hard not to repeat what has doomed those that have come before. Conservative...yes...long term survival however must remain the ultimate goal. Be very aware of greed.

Good luck to you

V2

 

[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