SWA Is Smart...

[Slug]

A fund

Alot of good my A fund is doing me now, or in the future.

 

[CoopDog]

A fund

Yep, looks like for many of us that the A fund is simply that.....a fund.....a fund that's probably gone for good.

Looks like it's gonna be 401k's and clip'n coupons for the next few years.

 

[Gearup727]

Look at today’s retirees with 401ks. After they have taken a huge hit in the market they are trying to eek out a few percent to live on. A 401k is a sorry excuse for a pension. These guys at Southwest don't have to worry about retirement though because by the time they hit sixty there will not be many years left in them. The problem is while they are all patting themselves on the back for running the majors out of business the whole industry is going down the drain. Who wants to make a career out of flying your but off for low pay and no retirement. The jobs at United that are being lost are quality airline jobs with reasonable work rules and good benefits. The guys at Southwest need to get on board with ALPA and get an A fund. These start up, low cost airlines will continue to nip at the heals of the majors but when they start really competing with them the pilots need get their stuff together and start getting paid!! The way things are heading when my little two year old grows up the only pilot jobs around will be regional and low cost carriers. It's great that southwest is making money on the backs of the naive employees but there is a whole industry that's going down the tubes. I don't have to preach to the people on this board about what it takes to get in the left seat at a major. Don't sell yourselves short.

 

[DH200]

Those poor overworked people

"The problem is while they are all patting themselves on the back for running the majors out of business the whole industry is going down the drain."

"It's great that southwest is making money on the backs of the naive employees but there is a whole industry that's going down the tubes. "

Um, ............... ALPA to the rescue? Right

 

[tredding@swa]

I brought this over from the thread "SWA 2003..." seems as if it belongs here...



Read somewhere that UAL will post a loss of $35+ PER share for 2002....

Regardless IF they survive or not,( I hope they do for all of my UAL buddies) chances are pretty good that they will be MUCH less competitive due to the massive amount of layoffs, planes parked (to be parked) IF the restructuring is approved.

Growth @ SWA is possible. Probably a good time for ALL LCCs to grow.... seems that it is the biz model that will become (has become?) the future of (at least) the domestic market.

Watch for the NEW financial catastrophe in 2003 - Pension Fund Fraud and/or underfunding problems. I Expect class action suits against investment management firms and actuaries as companies attempt to weasle out of payments and/or obligations.

As with tax reform in 1986.... more burden will be placed on the WORKER to fund his/her own retirement plan. As pensions (read A PLANS) quickly become a thing of the past..... the Bills are already in commitee for reforms, believe it that corporate America wants these reforms to pass, watch who you vote for in 2 years..... the handwriting is on the walls - why do you think they have already voted FOR, and passed, increased contributions to 401ks/SEPs/SIMPLEs/IRAs etc. ??

Unlike some, I don't pretend to be able to predict the future, just MY opnion that there are some pretty drastic changes coming our way in the airline industry.... don't count on many more bailouts... those who survive are going to have to make money, NOT lose money!!!

Tred


PS-
I will add the following comment for this thread - $200K+/yr. is great pay - for any industry. There are very few companies that offer a pension plan ("A" Plan) to ANY of their employees. Actually, I can't think of ANY firm that offers executives, or rank & file employees, a "pension". You either wake up and contribute to your 401k, or plan on living off a SS check and a part-time job at McDonalds.

I understand the frustration that is faced by those who are losing jobs, pensions and pay rates that "were" the norm for our industry. However, IMHO, there IS change happening in the business.... accepting the change and making it work for you will be the key to your happiness as a professional pilot.

To stand your ground for a $400K+ income, $85K+ lifetime pensions and work rules that allow you to be paid for 90 hours when you only work 70 hours IS admirable, but may not be very practical going forward.

I know the term "BIG picture" is over used and can be condescending and even aggrevating, but perhaps it is appropriate due to the possible "paradigm" shift that may be happening in our beloved profession.

Just food for thought, once again MY thoughts to stir (hopefully) some intelligent, thoughtful debate that I have come to enjoy (occaisionally) on this forum!!

Can't wait to see the responses...... oh boy.... Tred

 

[Snoopy58]

In the long run, a profession will get paid "what they are worth," with said worth determined by Supply & Demand, as well as what value they provide to their employer. Teachers do incredibly valuable work, but the supply is pretty high. Star quarterbacks may not contribute much to "society," but turning a team into a playoff regular is worth big bucks to the guys who pay the salaries -- and star QB's are hard to find.

There is only so much that negotiations can accomplish. If every pilot in the world banded together & said, "we either get paid $1M / year, or we don't fly," then some few pilots would get that wage (seem to remember a stat that a certain trans-Pacific FedEx flight produced $1M in revenue each flight), and a whole bunch wouldn't fly. Of course, nobody would honor such a pact for very long, and supply & demand would start to run its course, and the wages won by hard bargaining sooner or later would start to come back down.

Some times airline management makes stupid decisions (not that this is big news). It seems to me that UAL's management put themselves in a position where they couldn't say "no" to some of the union demands, even if the proposals were more than United could realistically pay over the long term. So UAL pilots got an "industry leading" contract. But the fact that the pilots (and other groups there) could GET such a contract does NOT mean that those pay rates were *sustainable*. Your employer may have to pay you whatever you negotiate, but the free market doesn't have to pay that much if it is more than the economic value of your work!

Recent history seems to show that very little of UAL's cost structure from the last few years is sustainable. Pilot pay, while only a part of the problem, IS part of the problem. Do I blame the pilots? Nope. They'd suffered from some awful conditions & givebacks, wanted to be compensated, asked for the moon, and by golly they got it. It isn't their job to run the airline or know what is affordable; management had given away so much & put themselves in such a position that they had no ability to negotiate for less. Bad on management. They created a situation that could not continue beyond the best of economic times.

Some places follow a more even-keel approach without the cycles of boom & bust, industry leading contracts followed by industry-leading furloughs & an industry-leading bankruptcy. "Slow but steady wins the race." Pay rates at SWA (generally acknowledged as the best airline management in the US today) aren't the highest, although total compensation (by the time you include total hours flown each year, profit sharing, 401k matching, stock appreciation, etc) is not that far off. There is a LOT more to compensation than $/hour, even if hourly wage is the easiest number to compare. Some people cry (or scream) about an "industry average wage," but what exact population one should find the average *of*, tends to be a rather moving target. How does one average in the salary for second year F/O's at UAL, DAL, AMR, etc right now?

The bitterness of a recent post is really a tragic thing to behold, but I just don't subscribe to the whole "holding down the profession's wages" theory. UAL's wages in their last contract didn't appear to be held down by anything... they went up to levels that are, in hindsight, unsustainable.

> The jobs at United that are being lost are quality airline jobs with reasonable work rules and good benefits.

I'd love to get paid $1M each year for flying jets, but the sad truth of the matter is that I don't bring that much value to the table. Not many pilots do. Even if some union could negotiate such a wage, if the pilots don't bring that much value to the job, then it won't be sustainable. Which is what we're seeing unfolding right now, with a great deal of pain & misery for those affected by it.

While there is room for improvement in the compensation, contract, work rules, & plenty of other issues at SWA, it is of tremendous value to know that it's a job at a stable, profitable airline; that continued growth will mean that there aren't any 10-year F/O's waiting to upgrade, and that retirement $, while less than I'd *like* to have (just like the $1M/year I'd like to make), is not subject to evaporating away to nothing if the company should go bankrupt, or have dishonest bookkeepers (ENRON).

If I had REALLY wanted to make a million dollars every year, I could have tried to become a corporate attorney or a brain surgeon or a venture capitalist. But I didn't. I became a pilot, and I enjoy my job. The money is nice, and while "more would always be better," I don't really want to pursue an "industry leading contract" if industry leading layoffs, instability, & turmoil are the accompanying price.

To those who think I should be dissatisfied with my situation because I don't make more than I do, I can only say that I'm sorry for your situation.

 

[LiveFreeorDie]

INDUSTRY LEADING PAY

If everyone got the INDUSTRY LEADING pay they *deserved* , then it would only be the average industry pay...

Infact, that is what happened to CEO compensation. No one wants their company to pay less than average CEO compensation. Which is why CEO's today get 10 million dollar golden parachutes after wrecking the companies they are paid to run.

So if Delta's union negotiates a sh!t hot contract, and United's unions decide thy derserve as much, and management buckles, we are all in for it.

It is funny listening to "Gearup 727". Yeah SWA is to blame for all the industry's problems. Man if they just didn't try to offer a better product for a cheaper price, we could stay competive. If they would just get onboard with ALPA we would ALL have INDUSTRY LEADING pay... but wouldn't that make it AVERAGE pay?

 

[Gearup727]

I'm not saying that Southwest is putting United, Eastern, Braniff or anyone else out of business. I'm saying that the pilots at these low cost airlines like Jet Blue, Airtran and Southwest should strive for retirements and schedules that are more inline with what the majors have traditionally offered. If they don't then a new paradigm will have been created for pilots of the future where A and B Funds are a thing of the past. Southwest will not dry up and blow away if they start a retirement system for pilots.

I agree that the pilot groups and United and Delta have stretched the limits when it comes to pay and benefits. Most airlines have started with the pilot and other work groups enjoying a good relationship with management. The company gets bigger, a middle management is inserted between the workers and the top management. Middle management in trying to control costs pisses off the employee groups. The employee groups unionize and work toward industry leading wages. The airline becomes high cost, gets bad management and when an economic down turn comes it starts taking on water. Southwest will be no different. It is early in the evolution of an airline. United is at the end of the evolution. Southwest didn’t put United out of business.

The pilots at SW should have an A fund. You may not think you're worth it but I think you are worth it and I'm not even a Southwest pilot. Don't sell yourselves short. Making Southwest pay you a retirement would put SW on and equal footing with other airlines who pilots are paid well and have retirements. What's the point of sitting back and saying ha ha my airline makes more than yours partially because I don't have the benefit package you have. Who wants to have the last laugh in that situation? I am not trying to throw any rocks at the SW guys but creating a new paradigm where pilots are compensated on a lower scale really doesn’t do any of us any good in the long term.

 

[Snoopy58]

Fully agree that traditionally, airlines that started out doing well have ended up as described:

> Middle management in trying to control costs pisses off the
> employee groups. The employee groups unionize and work
> toward industry leading wages. The airline becomes high cost,
> gets bad management and when an economic down turn
> comes it starts taking on water.

Where I disagree is with the idea that such is inevitable (at least at Southwest). SWA is one of the most unionized carriers in America, but (due to many things, including smart management, careful hiring practices, and a sincere effort to maintain the corporate culture) it is, as yet, NOT on the high cost path described. This high cost path, however, is what is being advocated with the statement

> I'm saying that the pilots at these low cost airlines like Jet Blue,
> Airtran and Southwest should strive for retirements and
> schedules that are more inline with what the majors have
> traditionally offered.

SWA labor should strive for the things that have created so many problems for the other carriers? No, thanks.

As I said, there is room for improvements in the contract, but SWA pilots aren't paid badly and have a more SECURE retirement in personal 401k's than U or UAL pilots do in company A/B funds. The guys who valued big $ over all else wouldn't be interested in SWA, but plenty of people value security & stability over the highest possible hourly wage.

Generally, SWA pilots are pretty happy with their situation at the moment. Why they would want to emulate the high-cost systems at airlines that are failing & ruin the good thing that they have going is beyond me.

 

[shagadelic]

We are looking at myriad possiblities to enhance our retirement in the next section 6. I don't believe you will see an "A" fund as one of the possibilities. Maybe raising our company match from 7.4 percent to something else. I believe the BOD will do what the pilots want and I haven't flown with anyone who advocates an "A" fund. While I agree with your statement that SWA will not immediately go under with an "A" fund, what happens twenty five years from now when some new CEO runs us into the ground? Why would I want your form of retirement? How secure does a 55 year-old United pilot feel about his retirement now?

Let me ask you a question, would you rather have the current Social Security system, or back when you first started working
would you rather have taken all that money and invested it yourself? I for one would rather have a stack of cash in the bank knowing that it was all mine and no politician or event could take it away.

I am into my third year at SWA. My first year I got an extra 15% in profit sharing (similar to a B fund, can't spend till retirement). My second year ended making right at $80,000 without working extra much. I only need 250 retirements and the addition of 40 airplanes to make captain (about 2 years from now unless we start growing more rapidly) I fly 3 on, 4 off and our overnights are definitely industry leading. We have a lot of fun flying, our flight attendents are a blast. And last, but not least, WE DON'T LEAVE PILOTS standing at the gate with a half full airplane just because we only have one jumpseat.

Am I kool-aid drinker? Absolutely not. I voted against our current contract extension because I thought we could do better and I thought the economy would turn around. I was wrong. Now I'm glad it passed. I'll take the 7000 options at just over
12 bucks and let it ride.

I am sorry that United is in the $hitter; I have many good friends there, and many furloughed. I hope they can pull it out. I am sorry for the guy in my new hire class who went there. I know they are a victim of their management, not their contract. But do I want what they have? I don't think so.