2nd Bankruptcuy Consideration
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nycbusdriver
Veteran
Maybe it's going to be a contest. Siegel holds the record for the quickest (and least productive) airline Chpater 11 in history: 7 1/2 months. Is Bronner/Lakefield out to beat the record by being faster and even less productive?
And PrinceofPAWOBs wonders why their seems to be so much negativity on these U boards. I don't call it negativity anymore...I call it our reality. Upset???Nah, not me, just downright disappointed and numb.
Interesting, you can surely tell the approximate ages of everyone on here, songs from the past are ringing true.
Interesting, you can surely tell the approximate ages of everyone on here, songs from the past are ringing true.
USA320Pilot
Veteran
- May 18, 2003
- 8,175
- 1,539
The company has done a good job of documenting its case for labor concessions since the company has gone on public record countless times stating their need to restructure and lower unit costs to LCC levels.
The only way to do that is to increase the productivity of aircraft, facilities, and human resources or the plan will fail. You simply cannot lower unit costs alone with labor cuts and be competitive, thus there must be a comprehensive solution.
That's why in yesterday's Charlotte Observer ALPA Spokesman Captain Jack Stephen said, "We are upbeat. For a long time this airline has sat sluggishly on the sidelines as the rest of the industry changed. "But the company was emphatic that things can't happen unless a new cost structure is put into place," Stephan said, since reduced fares must be accompanied by reduced costs. "It won't do any good to do one without the other."
Moreover, according to the Beaver County Times Another unchanged piece of the plan is for US Airways to seek a third round of concessions from workers. Negotiators for the pilots and the airline will meet next week, Stephan said. He echoed management's mantra that "this plan will require everyone to shoulder their portion of the load, and it won't be possible for one group to take up the slack, so to speak. While that was possible, maybe, in bankruptcy, it won't work this time. That message was given loud and clear today from the top man himself."
Regardless, the company has been building its S.1113 case since last fall and the unions have done nothing but support management's claim by not entering into formal negotiations. Basically, management has done its homework and labor may have played right into their hands.
ALPA has recognized this, which is why Stephan told the AP last Wednesday that the new plan dramatically increases the chances that the union will be willing to accept another round of wage concessions that the airline says it needs to avoid a second trip into bankruptcy.
Regards,
USA320Pilot
The only way to do that is to increase the productivity of aircraft, facilities, and human resources or the plan will fail. You simply cannot lower unit costs alone with labor cuts and be competitive, thus there must be a comprehensive solution.
That's why in yesterday's Charlotte Observer ALPA Spokesman Captain Jack Stephen said, "We are upbeat. For a long time this airline has sat sluggishly on the sidelines as the rest of the industry changed. "But the company was emphatic that things can't happen unless a new cost structure is put into place," Stephan said, since reduced fares must be accompanied by reduced costs. "It won't do any good to do one without the other."
Moreover, according to the Beaver County Times Another unchanged piece of the plan is for US Airways to seek a third round of concessions from workers. Negotiators for the pilots and the airline will meet next week, Stephan said. He echoed management's mantra that "this plan will require everyone to shoulder their portion of the load, and it won't be possible for one group to take up the slack, so to speak. While that was possible, maybe, in bankruptcy, it won't work this time. That message was given loud and clear today from the top man himself."
Regardless, the company has been building its S.1113 case since last fall and the unions have done nothing but support management's claim by not entering into formal negotiations. Basically, management has done its homework and labor may have played right into their hands.
ALPA has recognized this, which is why Stephan told the AP last Wednesday that the new plan dramatically increases the chances that the union will be willing to accept another round of wage concessions that the airline says it needs to avoid a second trip into bankruptcy.
Regards,
USA320Pilot
nycbusdriver
Veteran
Just answer me one thing, USA320Pilot -
Will the restructuring go forward with or without the employees?
(We're not quite clear on that yet.)
Will the restructuring go forward with or without the employees?
(We're not quite clear on that yet.)
ClueByFour
Veteran
- Aug 20, 2002
- 3,566
- 37
Oh, how quickly we forget that less than 24 months ago, all parties involved were assued in public statements and S1113 letters that the concessions granted were adequate under the POR, ATSB application, etc.USA320Pilot said:
Without having received (until this week) any detailed information at all about the company's plans, it's hardly bad faith on the part of the bargaining units in question to refuse to open the contracts--they have literally not been given a reason. One of the 8 things necessary for a 1113 motion to succeed is that the debtor must provide the union with such relevant information as is necessary to evaluate the proposal. That has yet to happen, and there has been no proposal made (so far as I'm aware) to any union save ALPA. Oh, and there is the small problem that the balance of the equities must favor rejection of the CBA.
The last is where the billions in concessions granted less than 24 months ago on a contract that the company wanted to last until 2008 during the last reorganization come into play.
Besides which, any number of parties could derail any US Chapter 11 filing by claiming fradulent conveyance. Or by exercising self-help.
There is also no guarantee that all creditors will go along with such a filing the second time around. I'm sure that major US stakeholders are well aware of what value Bronner got when he retained counsel to shop US pieces around a few months ago.
- Banned
- #24
Let me post this once again so a certain pilot understands, 1113 only comes into play AFTER a company files, not before, try again with the scare tactics.
Levine started her presentation with an overview of bankruptcy. The main goal of bankruptcy is to relieve a debtor of debts, thereby providing an opportunity for a fresh start. Bankruptcy also benefits creditors by providing a forum for an orderly liquidation of a debtor’s estate or a judicially scrutinized plan for full or partial repayment of creditor, and protecting unsecured creditors from preferential or fraudulent transfers of the debtor’s property and requiring adequate protection of secured creditor’s collateral.
There are two types of filling, Chapter 7, Liquidation and Chapter 11, Reorganization.
Levine continued, explaining the two types, but described Chapter 11 filings in depth. She explained the process and enlightened the attendees on all aspects of a chapter 11 filing. One thing that has stuck out in the US Airways members was a term called Fraudulent Conveyance.
Fraudulent Conveyance: A transfer of the debtor’s property is fraudulent if, made with the actual intent to hinder, delay, or defraud a creditor. (Note that sometimes the debtor’s actual intent maybe inferred circumstantially by certain “badges of fraud.†Alternatively, a debtor receives less than the reasonably equivalent value and was insolvent at the time of the transfer or became insolvent because of it or had “unreasonably small capital†remaining after the transfer for its business operations or intends to incur debts that it will be unable to repay as they mature. Many of the US Airways members asked hard-hitting questions about this as US Airways sold off airplanes and parts for less then fair market value not too long ago.
Our United attendees asked assertive questions in regards to the ESOP stock, numerous assets that United owns, and the ramifications on how they would be affected if United decided to file.
Levine also went over all the procedures and steps in the bankruptcy codes. One item she covered in depth is the 1113 letter, which refers to the section of code that ensures that a company negotiates with the union before they seek abrogation of the labor agreement. When a company seeks protection, the agreement remains in effect. When a union negotiates an 1113 letter it secures an agreement with the company showing that the company will not seek further cuts from labor. To this date, no company that has had an 1113 letter negotiated has ever asked the court to abrogate it.
Companies that request abrogation of the labor agreement but it must meet the following nine (9) distinct requirements:
1. The debtor in possession must have made a proposal to the union.
2. The proposal must be based upon the most complete and reliable information available at the time of the proposal.
3. The modification must be necessary to permit reorganization.
4. The modification must provide that all affected parties be treated fairly and equitably.
5. The debtor must provide the union with such relevant information as is necessary to evaluate the proposal.
6. The debtor must have met with the collective bargaining representative at the reasonable times subsequent to making the proposal.
7. The debtor must have negotiated with the union concerning the proposal in good faith.
8. The union must have refused to accept the proposal with good cause.
9. The balance of the equities must clearly favor rejection of the agreement.
Levine also noted that bankruptcy is not the preferred course for your contract.
Levine started her presentation with an overview of bankruptcy. The main goal of bankruptcy is to relieve a debtor of debts, thereby providing an opportunity for a fresh start. Bankruptcy also benefits creditors by providing a forum for an orderly liquidation of a debtor’s estate or a judicially scrutinized plan for full or partial repayment of creditor, and protecting unsecured creditors from preferential or fraudulent transfers of the debtor’s property and requiring adequate protection of secured creditor’s collateral.
There are two types of filling, Chapter 7, Liquidation and Chapter 11, Reorganization.
Levine continued, explaining the two types, but described Chapter 11 filings in depth. She explained the process and enlightened the attendees on all aspects of a chapter 11 filing. One thing that has stuck out in the US Airways members was a term called Fraudulent Conveyance.
Fraudulent Conveyance: A transfer of the debtor’s property is fraudulent if, made with the actual intent to hinder, delay, or defraud a creditor. (Note that sometimes the debtor’s actual intent maybe inferred circumstantially by certain “badges of fraud.†Alternatively, a debtor receives less than the reasonably equivalent value and was insolvent at the time of the transfer or became insolvent because of it or had “unreasonably small capital†remaining after the transfer for its business operations or intends to incur debts that it will be unable to repay as they mature. Many of the US Airways members asked hard-hitting questions about this as US Airways sold off airplanes and parts for less then fair market value not too long ago.
Our United attendees asked assertive questions in regards to the ESOP stock, numerous assets that United owns, and the ramifications on how they would be affected if United decided to file.
Levine also went over all the procedures and steps in the bankruptcy codes. One item she covered in depth is the 1113 letter, which refers to the section of code that ensures that a company negotiates with the union before they seek abrogation of the labor agreement. When a company seeks protection, the agreement remains in effect. When a union negotiates an 1113 letter it secures an agreement with the company showing that the company will not seek further cuts from labor. To this date, no company that has had an 1113 letter negotiated has ever asked the court to abrogate it.
Companies that request abrogation of the labor agreement but it must meet the following nine (9) distinct requirements:
1. The debtor in possession must have made a proposal to the union.
2. The proposal must be based upon the most complete and reliable information available at the time of the proposal.
3. The modification must be necessary to permit reorganization.
4. The modification must provide that all affected parties be treated fairly and equitably.
5. The debtor must provide the union with such relevant information as is necessary to evaluate the proposal.
6. The debtor must have met with the collective bargaining representative at the reasonable times subsequent to making the proposal.
7. The debtor must have negotiated with the union concerning the proposal in good faith.
8. The union must have refused to accept the proposal with good cause.
9. The balance of the equities must clearly favor rejection of the agreement.
Levine also noted that bankruptcy is not the preferred course for your contract.
mwereplanes
Senior
- Jan 21, 2004
- 302
- 0
So what?USA320Pilot said:
mr
USA320Pilot
Veteran
- May 18, 2003
- 8,175
- 1,539
700UW:
I am not the originator of the idea that the company has done a "good job" of documenting its argument for a potential S.1113 action and it’s likely the company will further build its case going forward.
One key point is that hte company keeps asking the IAM to address the A320 outsourcing issues and the IAM refuses. However, on the other hand ALPA has publicly said "the new plan dramatically increases the chances that the union will be willing to accept another round of wage concessions that the airline says it needs to avoid a second trip into bankruptcy."
Thus, ALPA protects itself in the press and the IAM hurts itself if a S.1113 motion is filed in bankruptcy court.
By the way, the "documenting its argument" thought came from an ALPA MEC Rep; therefore, you can take it or leave it. Regardless, there is a very real risk for all employee groups and your group has an option, just like everybody else.
In my opinion, in the IAM's case the company will execute the following plan:
1. Attempt to win the A320 outsourcing. If they do then they will replace all of the Boeing aircraft over time with Airbus and Embraer jets.
2. If the company loses the arbitration and avoids bankruptcy, close the Pittsburgh maintenance facility and move the operation to a location where it can operate at a lower unit cost, where I understand English is not spoken very well. In fact, negotiations are now being conducted to do just that and the stae and local government will fund the re-location.
That could be why Lakefield said in the letter to Govenor Rendell that US Airways would maintain its current number of gates and employment into the fall, but "the use of other facilities and support functions in the region will largely depend on the outcome of our negotiations with our labor unions."
3. If the company has trouble with labor, file a pre-packaged bankruptcy and have a strong case for a S.1113 motion. In the previous bankruptcy case the court sided with the company on virtually every motion, therefore, for argument purposes that could occur again. Then the company could implement a new contract and if any work group objected than they could seek self help (strike) or the company could use replacement workers, which in the case of the mechanics could be in a bad location.
Meanwhile, it is expected that my work group will strike a deal with the company because the pilots believe a bankruptcy court ordered agreement would be worse. Again, I do not want to see any body get hurt or lose their job, but the company must have competitive contracts across-the-board, including my work group, or it will likely fail. By the way, if the transformation plan is successful it will have a dramatic impact on every other legacy carrier, especially United and Delta Air Lines.
Respectfully,
USA320Pilot
I am not the originator of the idea that the company has done a "good job" of documenting its argument for a potential S.1113 action and it’s likely the company will further build its case going forward.
One key point is that hte company keeps asking the IAM to address the A320 outsourcing issues and the IAM refuses. However, on the other hand ALPA has publicly said "the new plan dramatically increases the chances that the union will be willing to accept another round of wage concessions that the airline says it needs to avoid a second trip into bankruptcy."
Thus, ALPA protects itself in the press and the IAM hurts itself if a S.1113 motion is filed in bankruptcy court.
By the way, the "documenting its argument" thought came from an ALPA MEC Rep; therefore, you can take it or leave it. Regardless, there is a very real risk for all employee groups and your group has an option, just like everybody else.
In my opinion, in the IAM's case the company will execute the following plan:
1. Attempt to win the A320 outsourcing. If they do then they will replace all of the Boeing aircraft over time with Airbus and Embraer jets.
2. If the company loses the arbitration and avoids bankruptcy, close the Pittsburgh maintenance facility and move the operation to a location where it can operate at a lower unit cost, where I understand English is not spoken very well. In fact, negotiations are now being conducted to do just that and the stae and local government will fund the re-location.
That could be why Lakefield said in the letter to Govenor Rendell that US Airways would maintain its current number of gates and employment into the fall, but "the use of other facilities and support functions in the region will largely depend on the outcome of our negotiations with our labor unions."
3. If the company has trouble with labor, file a pre-packaged bankruptcy and have a strong case for a S.1113 motion. In the previous bankruptcy case the court sided with the company on virtually every motion, therefore, for argument purposes that could occur again. Then the company could implement a new contract and if any work group objected than they could seek self help (strike) or the company could use replacement workers, which in the case of the mechanics could be in a bad location.
Meanwhile, it is expected that my work group will strike a deal with the company because the pilots believe a bankruptcy court ordered agreement would be worse. Again, I do not want to see any body get hurt or lose their job, but the company must have competitive contracts across-the-board, including my work group, or it will likely fail. By the way, if the transformation plan is successful it will have a dramatic impact on every other legacy carrier, especially United and Delta Air Lines.
Respectfully,
USA320Pilot
- Banned
- #27
Let me explain this to you once again, a company cannot make an 1113 motion in court unless they file bankruptcy, then they have to follow all nine steps, can you not understand that?
Go call Sharon Levine, I believe she knows a bit more about it then you.
Kinda of funny English is the official language of USA.
Let me tell you this for the millionith time, the company has not approached the IAM for a solution on the outsourcing issue, if you dont believe me, since appareantly you dont, go call Mr Robert Roach, General Vice President of Transportation for the IAM. I will give you his # if you like.
Once gain you post things that you have no idea or clue about.
But keep trying, at least you get more original with each false statement you post.
Here is your next CEO and his Assistant.
Go call Sharon Levine, I believe she knows a bit more about it then you.
Kinda of funny English is the official language of USA.
Let me tell you this for the millionith time, the company has not approached the IAM for a solution on the outsourcing issue, if you dont believe me, since appareantly you dont, go call Mr Robert Roach, General Vice President of Transportation for the IAM. I will give you his # if you like.
Once gain you post things that you have no idea or clue about.
But keep trying, at least you get more original with each false statement you post.
Here is your next CEO and his Assistant.
To All Naysayers,
Why are you guys picking on A320?
Is it because:
He is reminding us of the "reality" of this airline.
We are all in denial
We are afraid that the doors will be closed when we come to work next day
We will not be able to find a new job/career.
The non-serious people are burning the entire house with their negativity.
Why are you guys picking on A320?
Is it because:
He is reminding us of the "reality" of this airline.
We are all in denial
We are afraid that the doors will be closed when we come to work next day
We will not be able to find a new job/career.
The non-serious people are burning the entire house with their negativity.
Of course they will. Pilots are the least likely group to ever find another job making this kind of money.
You definitely DO want to see people lose their jobs. You trumpet it ever chance you get. The company got "competitive contracts", they just squandered the money.
Couldn't leave us out, now could you? Predictable! geez...lol
If that's respect, watch out!
- Banned
- #30
It is because he post blantant flasehoods and when you prove him wrong he says don't shoot the messenger or totally ignores it when you prove him wrong.Pragmatic said:
And it is not picking, it is providing the correct information to the posters on the board and show them what he is really about.
Three months and counting for his explanation of the dreaded "Painful" clause in the IAM Mechanic and Related contract.
