NWALPA's response to it's members.....

[General Lee]

Ziplines

A letter from the NWA MEC Chairman to the pilots of ALPA Councils 1, 20, 54, 55 & 74


​

TO: All Northwest Pilots
FROM: Dave Stevens
DATE: April 14, 2008


In the wake of the Delta-Northwest merger announcement today, I am writing to update the Northwest pilots. I will start by giving you the conclusion. Since January 2008, we have been working hard to put together a cooperative merger between the Northwest pilots, Delta management and the Delta pilot leadership. Agreement on the terms for a cooperative merger was in all stakeholders’ best interest in better times, with oil below $90 per barrel. With oil over $110 and an economy facing recession, and given the recent activities of the two managements and the Delta MEC, a merger with Delta may no longer be in the best interests of all Northwest stakeholders, including the Northwest pilot group. Northwest Airlines has strong standalone prospects given its cash position (best of the legacy carriers) and the flexibility of the NWA fleet, among other things. We are in a good position to weather the potential economic storm.

As a quick review, we started exploration of a cooperative merger with four key requirements from NWA MEC Resolution 08-01:

1. Creation of a profitable merged company with sufficient market presence and network scope to provide a stable platform for growth and sustainable profits;

2. Fair and equitable seniority list integration;

3. Collective bargaining agreement for the merged company with substantial improvements; and

4. Share in the equity of the merged company.

A cooperative merger provides a win-win formula for labor and management. By achieving a joint contract and seniority list prior to the effective date of the merger, revenue synergies and cost efficiencies are generated immediately (worth many hundreds of millions of dollars per year), and a portion of this economic upside could go to the pilot groups in the form of contract improvements and equity.

Since January, we have met with the Delta pilot leadership and Delta management in three extended efforts to accomplish the above requirements. By the end of the second session, we had accomplished requirements #3 and #4. However, we were unable to reach agreement on #2, an equitable seniority list, which is essential to accomplish #1. There was a great deal of collaborative effort expended by the Delta pilot leadership and Delta management to convince us to accept inequities in a seniority list in return for improved economics in a joint contract. As you know all too well, seniority is forever while economic provisions can be short lived.

The first two negotiations took place in New York City with oil below $90 per barrel. While we achieved agreement on a joint contract and equity and made progress on a seniority list, we did not achieve an equitable seniority list. The third negotiation took place in Washington, D.C., and while more progress was made on seniority, a seniority list agreement was not reached.
The seniority negotiations broke down over the Delta pilot leadership’s desire to include aircraft options, not just orders, in the seniority integration ratio. We were not willing to adjust the seniority integration ratio in favor of Delta pilots based on options, particularly when such options were unlikely to be exercised, other than as replacement aircraft, in the worsening economic environment. There were additional problems concerning calculation of the number of active pilots at each carrier and staffing assumptions for the future. The resulting difference in our respective positions on a ratio was substantial. The actual breakdown occurred when, in response to my suggestion that we both compromise and bring that to our respective MECs for their consideration, we were advised that the Delta pilot group could not move off their last ratio proposal.

As we had several times before, we then suggested to the Delta pilot leadership that we agree on expedited arbitration of the outstanding issues by a date certain. The result of an expedited arbitration would have been functionally the same as an immediate negotiated agreement since there would have been one seniority list and a joint contract in place on the transaction effective date.




continued.....

 

[General Lee]

By use of this process, much of the transaction risk would have been taken out of the merger and additional funds would have been generated to pay for one-time transition costs. In the uncertain world of airline economics, this was a key consideration. When two airlines merge, they attempt to realize the benefits of the created synergies before they run out of cash on hand to pay for the transition costs. In our current environment, there is no more money to borrow and airlines have few assets left to encumber.

Unfortunately, the Delta pilot leadership rejected arbitration, whether expedited or not, as a means to resolve the seniority list dispute. From that point, Delta management, the Delta pilot leadership and Northwest management chose a different path. NWA management proposed a traditional merger to Delta management. Then Delta management entered into bilateral negotiations with the representatives of the Delta MEC. The representatives of the Northwest pilots were excluded from the negotiations. Inexplicably, the Delta pilot leadership reversed its position. They are now willing to arbitrate the seniority list issues under ALPA merger policy. At the same time, they abandoned the joint pilot contract approach and have, instead, agreed to a Delta pilot contract amendment which will increase the pay and benefits for only Delta pilots. The Northwest pilots are excluded from the economic benefits. Both managements have cooperated in this change in course.

Yesterday we met with Delta CEO Anderson, President Bastian and EVP Campbell. At that meeting, we suggested that they delay the merger announcement and spend a short period negotiating a joint contract with a focus on their harmonization issues. This suggestion was rejected in favor of the plan they are currently pursuing. In explanation, they said we were out of time to negotiate prior to a merger announcement date (despite the fact they found two weeks to negotiate a deal with the Delta pilot leadership).

As a result, there will be seniority arbitration in a traditional merger process and it may take a long time. The Delta pilot leadership may choose not to cooperate on a joint contract for the benefit of the Northwest pilots while they seek an agreement on seniority that favors the Delta pilots.

Now we reach the question your MEC considered at its meeting yesterday – Should the pilots, employees and customers of Northwest support this merger as it is currently contemplated? The managements are betting on the merger models of old: Pay the employees of one group less and focus on lowering costs (instead of many of the revenue synergies that are far more likely to improve the bottom line); hope for cost savings going forward from employee division with no concern for the dis-synergies caused by labor dissatisfaction. The point has already been made to us by Delta management that they already have a “B scale” at Northwest, and that they will need to maintain it by phasing in harmonized wages. Mergers based on this model have never worked well, but trying to make this work at $110/bbl fuel, with a looming recession and no access to credit markets, is putting everything at risk.

One can only conclude that the Delta pilot leadership and Delta management have made an arrangement to try to disadvantage the Northwest pilots economically and with respect to our seniority. No pilot group is going to put up with this. No amount of money can sustain a carrier which creates this level of discord. This is a recipe for failure. Under these conditions, Northwest Airlines and all the stakeholders, including the pilots, other employees and customers, are better served by a standalone airline. Under these circumstances, it is Northwest’s best option, with its strong international and domestic route structure, a flexible fleet, an order book with fuel-efficient aircraft and the best cash position of any legacy carrier, to remain an independent carrier.

Your MEC reached this conclusion with reluctance. We were very close to concluding a truly cooperative merger which would have served the interests of everyone. We regret that an agreement was not obtained. However, the past is past. The Northwest pilot group now has to face a difficult future. As hard as a standalone course may be in these economic times, it is our judgment that it carries less risk than the merger path which now lies before us. For that reason, we will be turning our efforts to stopping this merger. Over the course of the next few weeks, we will be sending you more information on the MEC’s plans. Look for a road show schedule to be posted soon.

Fraternally and in Unity,

Dave Stevens
MEC Chairman


Bye Bye--General Lee

 

[General Lee]

Guess what guys? You can't have it all. You can't keep your pension, get a larger raise than the rest of us, keep our better work rules, have a chance to have more bases, more widebodies to fly, and to get rid of Steenland. Sorry. You have to be flexible and fair. And, get rid of your greenbook merger committee chair, he is weighing you DOWN.


Bye Bye--General Lee

 

[DTW320]

Guess what guys? You can't have it all. You can't keep your pension, get a larger raise than the rest of us, keep our better work rules, have a chance to have more bases, more widebodies to fly, and to get rid of Steenland. Sorry. You have to be flexible and fair. And, get rid of your greenbook merger committee chair, he is weighing you DOWN.


Bye Bye--General Lee

Hilarious. Posting and replying to yourself. And apparently you didn't even read the Ziplines.

BTW...you didn't get rid of Steenland either. He'll be on the BOD.

 

[General Lee]

Hilarious. Posting and replying to yourself. BTW...you didn't get rid of Steenland either.

Posting to myself? I just wanted to make sure I didn't post anything on your MEC's response. (I like how Steven's said something about your "Flexible fleet"---yeah right).

And, I have a feeling Steenland will be leaving sometime in June. Maybe 8 million reasons.


Bye Bye--General Lee

 

[Superpilot92]

Bottom line is the sooner we start working together the sooner we can start working for bigger and better things.

 

[737 Pylt]

Bottom line is the sooner we start working together the sooner we can start working for bigger and better things.

Superpilot:
Well said, let's start by you guys dumping those 3 books you guys call a union, along with your greenbook leadership! You deserve better.
22 years of this sh*t, the NWA pilots deserve better!

737

 

[FDJ2]

Bottom line is the sooner we start working together the sooner we can start working for bigger and better things.

That's very true.

Keep this all in perspective. Nothing has happened to the NWA pilots. They still have the contract they negotiated, they still have their attrition, they still have their orders.

The Delta pilots were able to negotiate contractual improvements with their management, what's so bad about that?

If we work together, we can pattern bargain off of those improvements in a joint contract.

 

[PeanuckleCRJ]

Greenbook/redbook/bluebook were done away with in 2006.


I hope we can call get some good pay from this and no furloughs.

 

[Occam's Razor]

The Delta pilots were able to negotiate contractual improvements with their management, what's so bad about that?

If we work together, we can pattern bargain off of those improvements in a joint contract.

Hmmmm.

Does your contract contain a requirement to provide parity for NWA pilots when a SLI is reached?

Your answer is there, my brother.

 

[Noserider76]

Hmmmm.

Does your contract contain a requirement to provide parity for NWA pilots when a SLI is reached?

Your answer is there, my brother.

Your suggesting there would be two contracts in force post-SLI? I don't see it happening. Seems to me that DALPA negotiated a interim contract that will provide a good base for a joint contract after a combined list is agreed upon. I would also wager that NW pilots will receive an equity stake which gives them an equal payout to the DL pilots.

There has been so much distrust, it's amazing. The posters on this board had DL negotiating away the DC-9s as well as NW jobs and every other imaginable crime. It's no wonder no SLI agreement was possible. Arbitration is your only option when your distrust runs so deep and I'm sure that's where we'll end up.

 

[FBN0223]

Guess what guys? You can't have it all. You can't keep your pension....


Bye Bye--General Lee

What pension? Sorry, most of us at NWA watched that boat sail away.

 

[PlaneDrvr]

Hmmmm.

Does your contract contain a requirement to provide parity for NWA pilots when a SLI is reached?

Your answer is there, my brother.

Don't have a dog in this fight, but you brought up a very important point, Occam.

If the DAL pilot true intent was/is to be 'fair' then the deal that they negotiated will have a 'requirement' that; 'upon achieving a SLI (on List), the NWA pilot will receive immediate parity with the DAL pilots.'

If it does Not contain such language, then the clear intent was for the DAL pilots to secure a comfrontable seat on the Bus, with the NWA pilot left 'under the bus' What else would it look like??

REALITY CHECK; now the NWA pilots have to negotiate with a 'gun to their head' as the DAL pilots got what they want; NWA pilots got NOTHING.....'DAL pilots to the NWA pilots'----Give in to what 'we' want, or the bus runs over you, then backs over you.

Just the way it looks from an Outside observer. Am I close??

For what its worth.

DA

P.S. Again, now waiting for 'CAL/UAL' that should also be interesting??

 

[UALjan15]

Bottom line is the sooner we start working together the sooner we can start working for bigger and better things.

It seems like that phrase has a vaguely familiar ring to it. It doesn't seem like you're off to a very good start right now.

I was going to be seriously impressed if these two groups could forge a list and a joint contract before the merger was announced (and learn from our mistakes), but alas, it was too much to ask for. Good luck to all of you (you're going to need it).

 

[Flybet3]

Bottom line is the sooner we start working together the sooner we can start working for bigger and better things.

If only my friend. Unfortunatly everyone has their own agenda and doesn't care about their fellow man.

 

[aircowboy]

The "sir yes sir southern boys" have forced the NWA pilots to circle the wagons. Why am I not suprised that the same group that caved on scope and gave the unlimited RJs gift to us all would pull a move like this.

 

[aircowboy]

 

[hockeypilot44]

What are the chances of new Delta aircraft going to NWA instead of Delta because NWA pays less? This might end up like the regional whipsaw on a much bigger scale. DALPA took for itself short term without considering the consequences.

 

[HAL]

Guys, after seeing what this kind of rancor did to the AWA/US merger, please, please, take the time to step back (both sides) and stop bickering about the small stuff. Get together, and get a good contract; don't worry about who is getting a 'bigger raise'. Merge equitably, with a few minor fences to protect whatever flying you feel is 'special' to your side of the deal. But most of all, take the long term view. Most of you will have to live with the results for a couple decades or more and in the end, it is the people sitting next to you in the cockpit that make or break the job. Don't get so bogged down in greed that you end up hating the 'other side' for the rest of your career. Git 'er done, shake hands, and work on getting the BEST contract for everyone. If you have to ask how bad it can get, just wait for the responses from the former AWA or US pilots.

HAL

 

[Flybet3]

Guys, after seeing what this kind of rancor did to the AWA/US merger, please, please, take the time to step back (both sides) and stop bickering about the small stuff. Get together, and get a good contract; don't worry about who is getting a 'bigger raise'. Merge equitably, with a few minor fences to protect whatever flying you feel is 'special' to your side of the deal. But most of all, take the long term view. Most of you will have to live with the results for a couple decades or more and in the end, it is the people sitting next to you in the cockpit that make or break the job. Don't get so bogged down in greed that you end up hating the 'other side' for the rest of your career. Git 'er done, shake hands, and work on getting the BEST contract for everyone. If you have to ask how bad it can get, just wait for the responses from the former AWA or US pilots.

HAL

May the good lord bless you and prosper you for trying to knock some sense in these people, and promoting harmony. But no one will ever listen, b/c their greedy, selfish ways wont allow it.