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"wasting opportunities" and delaying a deal ..

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350DRIVER

Time is a ticking....

US Airways pilots sharply divided as cost-cutting talks falter

Tuesday, August 31, 2004

By Dan Fitzpatrick, Pittsburgh Post-Gazette







ARLINGTON, Va. -- The top leaders of US Airways' pilots union yesterday angrily accused four Pennsylvania pilot representatives of "wasting opportunities" and delaying a deal that could help the airline avoid a possible bankruptcy in mid-September.

As critical cost-cutting negotiations continued between US Airways and its pilots, tensions flared into the open yesterday, with union members shouting at each other at a suburban Washington, D.C., hotel and blaming the lack of bargaining progress on the Pennsylvania pilots.

Pilots chairman Bill Pollock, told US Airways' 3,000 pilots, in a telephone message at 1:40 a.m. yesterday, ``You unequivocally deserve better." Pollack added, "We are running out of time and wasting opportunities."

His outburst was aimed at John Brookman, Fred Freshwater, Dan Von Bargen and John Crocker, four of the 12 members of the union's Master Executive Council, who have been the most resistant to making additional concessions to the company. Brookman and Freshwater represent pilots from Pittsburgh; Von Bargen and Crocker are from Philadelphia.

In a harshly worded letter released to their members, the eight other members of the Master Executive Council said the Pittsburgh and Philadelphia representatives will not allow the union's negotiating committee enough leeway to get a deal all pilots can ratify. They need to stop thinking about their own reputations and "start thinking of the familes and pilots they represent," the eight pilots said.

Brookman, Freshwater, Von Bargen and Crocker are central players in a intra-union battle that is threatening to derail further negotiations and make it more difficult for US Airways to avoid bankruptcy in the next few weeks. .....Because the four leaders represent large concentrations of US Airways pilots in Pittsburgh and Philadelphia, they wield considerable power and can control any vote taken by the union's 12-member Master Executive Council. All four reflect the demographics of their membership, representing older pilots who have gone through two concessionary rounds in the last two years and want to preserve what is left of their retirement plan, which the company now wants to cut further.

Critics within the pilots union claim the four Pennsylvania representatives are ignoring the company's larger financial problems and are blocking any real bargaining with the company, which is seeking $295 million in new annual concessions. No progress was made over the weekend when negotiations resumed after a week of inaction. The two sides traded proposals that differed little from prior offers.

Eight other pilot leaders from Charlotte, Boston, Washington, D.C. and New York took out their frustration on the four Pennsylvania representatives yesterday, blaming them for the lack of momentum. "The politics of delay, obstruction, hindrance and thwarting of the process can only be viewed as obstructionism," the letter from the eight members of the Master Execucutive Council said.

Don Hollerbach, one of the union's contract negotiators, made the same point in a closed door meeting Friday night. The four Pennsylvania representatives set too many restrictions on the new talks, Hollerbach said in an outburst recalled by several pilots yesterday.

"Sending us in shackled sets us up for failure," Hollerbach said, as quoted by the eight pilots on the Master Executive Council. "Give us the weapons to do our job -- to get an agreement. Don't cut my leg off and ask me to go in to kick somebody's ass."

But the four pilot leaders from Pennsylvania maintain they are doing what is best for all pilots and their motives are being misrepresented. In fact, they pushed for a resumption of the negotiations with the company on Friday.

They told negotiators that they would authorize no further cuts in the retirement plan. They did give negotiators the authority to discuss changes in work rules that they say could close the gap between the two sides and result in savings of $295 million.

But Sunday night, when the union tried to give negotiators more leeway to negotiate the "best [agreement] that is achievable," the four Pennsylvania representatives slowed the process, asking for three recesses and eventually toughened the language. They crafted an amended resolution that passed unanimously yesterday, asking negotiators to resume talks but warning that if the company's proposal deviates much from the union's most recent offer, the chance of it failing "increases exponentially."

The four Pennsylvania representatives argue that the language needed to be stronger for the union to look less desperate, giving it more leverage for an eventual deal.

After almost three months of nearly nonstop negotiations, that delay was, for some, the last straw. Emotions spilled out into the hallway of the Key Bridge Marriott in suburban Washington D.C. yesterday morning, with one pilot confronting Von Bargen, calling his decisions a "travesty" and saying to him sarcastically, "Thanks for serving us."

"You know we're short of time, don't you Dan?" the pilot said to Von Bargen.

Another pilot suggested that Von Bargen wants the company to declare bankruptcy again.

Von Bargen expressed his anger at the suggestion, saying "I don't like people putting words in my mouth."

In a private meeting with union negotiators Sunday afternoon, US Airways CEO Bruce Lakefield acknowledged the rift within the union and said, according to Pollock, that he is "preparing for the worst."

The airline has said it needs $800 million in cuts from all unions, and $295 million from the pilots, to avoid its second bankruptcy in two years this fall.





(Dan Fitzpatrick can be reached at [email protected] or 412-263-1752.)

http://www.post-gazette.com/pg/04244/370556.stm

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Reuters
UPDATE - US Airways pilots, management plan fresh talks
Monday August 30, 7:12 pm ET


(Recasts, adds share closing price, comment from airline spokesman)
NEW YORK, Aug 30 (Reuters) - US Airways Group Inc.'s (NasdaqNM:UAIR - News) pilots union leaders on Monday said they proposed new contract terms to management, which in turn made a counteroffer, after the union last week refused to endorse a company plan for $295 million of concessions.

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According to the union's Web site, the union made a new offer to management on Saturday, which prompted management to make a counteroffer on Sunday.

Terms of the offers were not immediately available.

David Castelveter, an airline spokesman said US Airways negotiators would reconvene for a resumption of talks later on Monday evening.

"We expect to reconvene our meeting with them this evening. We're willing to work around the clock to reach an agreement," Castelveter said, without elaborating.

Optimism about a resumption of talks fueled US Airways stock 27 cents, or 14.59 percent higher, to close Monday's trading session at $2.12 on Nasdaq.

The No. 7 U.S. airline, based in Arlington, Virginia, has said it has just weeks to reach giveback agreements with all of its unions before deciding whether to enter bankruptcy for the second time in two years.

This month, US Airways Chairman David Bronner told the New York Times that agreements were needed well before Sept. 30, when the carrier might trip covenants in its federally guaranteed loans, or US Airways might be forced to liquidate.

Since emerging from Chapter 11 in 2003, US Airways has been buffeted by soaring fuel prices and fierce challenges from such low-cost competitors as Southwest Airlines Inc. (NYSE:LUV - News).

The carrier has been seeking $800 million of concessions from unions, representing more than half of its immediate cost-cutting targets. The pilots' share, prior to Sunday's counteroffer, would have included a 16 percent pay cut.

Support from pilots for concessions will likely make winning concessions from other unions easier. Talks with machinists, flight attendants and other groups are ongoing.
 
Divide and Conquer!!!!!! Classic!

Dave Siegel must be laughing his a$$ off with his $9 million severence... I do agree that you can't let the salary/benefits bar go too much lower - it will make it worse for everyone else - including those USAirways people who ultimately work somewhere else - they are just lowering the bar for themselves down the line....

MDA E170 pilots are now paid LESS than Mesa pilots - who expected that to happen???? Kudos to those pilots who try to preserve the MINIMUM wage bar in this industry - now that's courage in my book....
 
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350DRIVER said:
Brookman, Freshwater, Von Bargen and Crocker are central players in a intra-union battle that is threatening to derail further negotiations and make it more difficult for US Airways to avoid bankruptcy in the next few weeks. .....Because the four leaders represent large concentrations of US Airways pilots in Pittsburgh and Philadelphia, they wield considerable power and can control any vote taken by the union's 12-member Master Executive Council. All four reflect the demographics of their membership, representing older pilots who have gone through two concessionary rounds in the last two years and want to preserve what is left of their retirement plan, which the company now wants to cut further.
So let me get this straight... management already got a nearly 75% reduction in the pensions and wants MORE??!!

But the four pilot leaders from Pennsylvania maintain they are doing what is best for all pilots and their motives are being misrepresented. In fact, they pushed for a resumption of the negotiations with the company on Friday.

They told negotiators that they would authorize no further cuts in the retirement plan. They did give negotiators the authority to discuss changes in work rules that they say could close the gap between the two sides and result in savings of $295 million.
So these pilots have found a way to give U management the money they are asking for (referred to at the bottom of the press release again), just not in exactly the same way the company wants, while maintaining the pensions for the pilots they represent who will be retiring in the next few years and that makes them the bad guys?

Sounds like the junior guys want to sell the senior guys down the river but they just don't have the weight to do it while the senior guys have found a way to make things work and won't back down since they know it's a workable plan. Isn't that what the senior U pilots paid dues for 20+ years to get?

"Sending us in shackled sets us up for failure," Hollerbach said, as quoted by the eight pilots on the Master Executive Council. "Give us the weapons to do our job -- to get an agreement. Don't cut my leg off and ask me to go in to kick somebody's ass."
Now that's just plain funny... "We are the knights who say "NI!" (Monty Python's Holy Grail for those too young to get the reference).

The airline has said it needs $800 million in cuts from all unions, and $295 million from the pilots, to avoid its second bankruptcy in two years this fall.
Management is getting their $295M, let them go bug another union for the rest.
 
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At some point you have to say enough. This is getting ridiculous. Does anyone actually believe that another round in concessions will save USAIR? Additionally, all the other unions have told management the concession stand is closed.

Any monetary savings at this point will only fatten the creditors balance sheets when the airline goes into bankruptcy, probably later this month. There is no way U can meet it's debt obligations next month with available cash on hand.

It kind of galls me personally since UALPA was telling us in 83 to fall on our swords over Lorenzo and his draconian paycuts and work rules. Now the shoe is on the other foot and it looks like they don't like the fit.
 
Mayday! Mayday!

Regrettably, every round of brutal negotiations further lowers the salary/benefits bar for everyone in the future.... I certainly feel for all of the USAirways and DAL people out there with their tough negotiations, but our industry is sinking fast and the standards are dropping quickly... Just wait until Virgin America arrives, JetBlue EMB190 FO pay will look great in comparison!
 
Boeingman said:
At some point you have to say enough. This is getting ridiculous. Does anyone actually believe that another round in concessions will save USAIR? Additionally, all the other unions have told management the concession stand is closed.

Any monetary savings at this point will only fatten the creditors balance sheets when the airline goes into bankruptcy, probably later this month. There is no way U can meet it's debt obligations next month with available cash on hand.

It kind of galls me personally since UALPA was telling us in 83 to fall on our swords over Lorenzo and his draconian paycuts and work rules. Now the shoe is on the other foot and it looks like they don't like the fit.
Another interesting look back. It got me thinking about the comments I have read on this board over the last 8 years or so that I have looked in. I remember when, for example, UAL was the hot ticket in the late 90s. There were plenty of jerks on here suggesting that if you couldn't get on with them, you were not worthy and were in for a sub-par career with the likes of Southwest (who would want to buy a type rating and get stuck flying a guppy for their whole career?) Today, of course, we have UAL pilots that left SWA for UAL wishing they had a time machine. Unfortunately, I see the same attitudes thrown around when it comes to the success stories of today, whether it be SWA or JetBlue. Some guys know how to be humble about it, but the jerks are always out there that like to be in your face with it. I have learned that no matter where the career takes us from here, to always be skeptical and keep your head from getting inflated. Or, as Boeingman pointed out with just one tidbit of history, you too may find out that you don't much like the way the shoe fits on the other foot someday.
 
Mugs said:
Another interesting look back. It got me thinking about the comments I have read on this board over the last 8 years or so that I have looked in. I remember when, for example, UAL was the hot ticket in the late 90s. There were plenty of jerks on here suggesting that if you couldn't get on with them, you were not worthy and were in for a sub-par career with the likes of Southwest (who would want to buy a type rating and get stuck flying a guppy for their whole career?) Today, of course, we have UAL pilots that left SWA for UAL wishing they had a time machine. Unfortunately, I see the same attitudes thrown around when it comes to the success stories of today, whether it be SWA or JetBlue. Some guys know how to be humble about it, but the jerks are always out there that like to be in your face with it. I have learned that no matter where the career takes us from here, to always be skeptical and keep your head from getting inflated. Or, as Boeingman pointed out with just one tidbit of history, you too may find out that you don't much like the way the shoe fits on the other foot someday.
Very accurate statement. It is interesting seeing how ALPA at USAir is squirming right now. You never know if you made the right choice in this industry until you retire. Hopefully, there is only one airline uniform style in the closet at that time.
 

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