The number I cited is from the most recent 4k; the same one that explicitly notes that FTE's and fleet count do not factor in DCI carriers (the rest of the consolidated data does, of course).
I know how the math works. Maybe you should remember that you're on a site where it isn't everyone's first day.
No matter how you slice it, FTE's are down 4% YoY.
BTW: For those that may not know, DL counts a regular FT employee as 1, a PT employee as .75, and a Ready Reserve as 1/2.
They do not publicly break out each group, so when WT notes that they are retaining jobs as part of the "superior employment experience," he has no way to know how many of those are RFT, vs. RR.
First, I am VERY happy to see you using some of the data available to debate your points…. I KNEW all along that you were capable of looking at the data and having a good debate….
I’m not sure what the 4K is you reference but DL filed an 8K at the same time they released earnings and, while I cannot get the 8K to download today, I am almost certain it is the same earnings press release which includes employment numbers and the percentage change you reference.
It also includes this statement which I think you also reference.
Note: except for full-time equivalent employees and number of aircraft in fleet, consolidated data presented includes operations under Delta's contract carrier arrangements.
I can tell you that how DL counts employees has ALWAYS been confusing but I am quite certain that Comair’s employees are included in that count, along w/ all other wholly owned subsidiaries. OH was not a contract carrier since it was a wholly owned subsidiary. Correct me if I’m wrong, but I thought MLT vacations was a wholly owned subsidiary and DL also is in the process of moving operations out of MSP which would also affect those numbers. Trainer is also wholly owned and those employees will count in that number.
But even if I am wrong and you are right, I’m not sure it changes the argument too much. DL has offered early out programs this year and said most of the exit dates would be after summer… which was before the end of the 3[sup]rd[/sup] quarter. Including pilots there might have been 2200-2500 employees… plus normal attrition.
I think the key point is that you say that DL is eliminating full-time positions and not replacing them. If they are replaced at all it is with PT/RR people. You are correct that I do not know the composition of the workforce – PT/FT – and you are right.
But I have never argued that DL is retaining future FT positions or denied that DL is converting FT positions to PT/RR. I have said- repeatedly – that DL is committed to protecting the jobs of EXISTING full-time employees and offering incentives for EXISTING employees to leave.
I continue to believe DL’s strategy of reducing costs – esp. benefits costs which vary widely between FT and PT/RR employees as well as younger (college RRs etc) and senior employees (families or middle age when health issues start to become more pronounced).
You seem to be more focused on the fact that FT jobs are diminishing regardless of how they are eliminated.
DL said earlier this year that it would reduce headcount via the voluntary packages for non-pilot and pilot personnel and would not replace those people this year… I think you are seeing that right now. Perhaps next summer if the airline grows, DL will hire more PT/RR people but I suspect you are seeing at least at least a 9 month long reduction in the total number of people on DL’s payroll. Pilots are waiting for the fleet plan for 2013 but there are indications that DL will be retaining some planes, including the DC9s for at least another summer to support domestic expansion which almost has to be started in the summer. The NYC expansion has been very successful and some pilots are saying that DL will start shifting domestic – not just int’l growth – to the west coast including LAX and SEA. On the earnings call, DL noted that the JFK transcons are doing particularly well in part due to the expanded service and amenities DL is offering. This winter DL will offer more flights JFK-SFO than AA and DL’s transcon BE is an int’l quality product compared to what is used on other domestic markets and DL is apparently looking at upgrading the transcon 757 fleet to lie flat business class. DL already is already almost on par with AA and UA onboard revenue for the transcons due to DL’s greater number of seats on the aircraft. The significance is that the JFK transcons have long been a market where DL has not been able to generate industry standard revenues. With evidence that Virgin America’s plan is not working and they may be forced to pull back, and with DL’s buildup in other NYC markets where DL is getting industry average or better revenue, DL is much better positioned than ever to be seen as a one-stop player in the NYC market – which right now is heavily divided between AA, DL, and UA as well as B6 as the largest players.
As much as some people focus heavily on labor issues to the exclusion of revenue and marketing, any company’s ability to pay its people well is directly tied to how well they do in the marketplace.
One more note about staffing… DL is cutting staff for the winter based on the early outs. Remember that DL is passing out pay raises – did so in July and will do it again in Jan. DL’s non-fuel costs were up and a lot of analysts noted that DL seemed to have committed to pay raises before it began to see the benefits of increased productivity and efficiency that will come esp. from the new pilot agreement. Probably a correct assessment.
Some people might not want to hear it but I also believe there is a competitive component to DL’s compensation policies. DL knew full well that UA pilots were getting close to a contract and that by raising DL pilot pay, it put even more pressure on UA to agree to DL pilot levels since it is really hard for UA to come up w/ a reason why it cannot match DL pilot levels. AA is in a somewhat different position but its pilots still continue to argue that they should be paid DL pay levels. Note that even w/ the July pay increases, DL still managed to have a ~ $1B profit and DL has the lowest CASM among legacy carriers. UA’s profit was all but wiped out by the ~$500M lump sum payment it must make to its pilots because the company has dragged its feet for so long in signing a new contract (which is still not signed due to intra-ALPA struggles about how to distribute that money.) UA ALPA previously said that DL level pay would cost UA $750M per year, meaning that the $500M in one quarter in the best quarter is not terribly indicative of the pressure that will be on UA to deliver revenues to support the pay raises necessary to merge the UA/CO workforces AND move past the BK contracts which many UA employees still work under.
For years, the network airlines could argue that it was ok to ignore WN pay because they were “different” but AA and UA labor won’t allow their employees to ignore DL pay levels.
DL has the benefit of 2 extra years in integrating NW into DL and to moving to new initiatives like NYC and now SEA-Asia and the refleeting initiative that will help improve DL’s efficiencies while AA and UA are still working thru other strategic issues. Wall Street and customers are noticing what DL is doing and that only helps DL employees….
...Also not nearly as "evil" as the ministry of propaganda has made it out to be. MGMT traveled on "3's," but the masses had an allotment of those that they could use as well annually- to say nothing of the previously mentioned 3A's that DL was so quick to get rid of.
Good perspective… but there is a difference since DL offered no boarding “bumps” to any workgroup.
I merely point out that several hundred people found themselves in the exact opposite situation you describe.
MSP stock clerks could:
A. Move to ATL
B. Put in for a job on eBid
C. Retire
They aren't victims; they're living examples of how DL's reduction in force policy is anything but "superior" to what they had under a CBA.
I understand redundancy.
The issue is the anodyne (and often revisionist) version of reality the company and it's acolytes like to peddle.
Ok… so help me understand how a union could have offered other alternatives. If the only place where DL kept stores was in ATL, what could a union have done that DL didn’t offer… and DL’s policy allows employees to move between workgroups, something unions do not necessarily allow, esp. in downsizing situations.
It appears that your concern continues to be focused on a potential station closure scenario where your station would be closed and you might be forced to move to a station you don’t want to go to… instead of being able to bump into a station of your choosing.
Valid concern but I still do not see why DL has any incentive to pull DL staffing from any existing station as long as they can use PT/RR people who cost as little per hour as contract people including the profit margin for that company (if not DL – which answers your concern as to why DL has wholly owned ground handling subsidiaries – also doesn’t provide a true picture of “true” DL employees).
Yes.
For far too long, labor has been cowed into giving away the store to "save the pension." I would prefer the fight shift to both improving 401k plans (matches, allocation options, etc.), and using the savings to improve other "asks" (scope, medical, pay, what have you).
I also recognize that traditionally I've been very much in the minority in that regard. I do think the tide is shifting at least a little though...
Just a reminder that DL DID save the pensions and has been spending $500-700M on funding frozen pensions that UA and US do not spend.
I’m sure that if a wide enough lead opens up between DL and other network carriers regarding pay, I have a feeling many DL employees would agree w/ you regarding increasing benefits, esp. retirement funding. Be active on this and let your voice be known. There is obviously room for improvement with medical as well as the potential to buy an extra week of vacation or bank more unused sick time.
Kev, you really should get involved with negotiations or union leadership at some capacity. If that's how you feel and you seem to be culturally attached to the union why don't you take a position in Upper Marlboro or with another union? I'm in no way saying there is no place for you at DL but it just seems that is where your passion is. You've acknowledged that organized labor is "under attack" and has been "vilified" so maybe through new leadership like yourself you could turn things around. Judging by your posts here you have a lot to contribute, you seem to be smart, dedicated, and able to tolerate opposing view points. Just my two cents.
Josh
I have encouraged Kev for years to consider using his very obvious talents and abilities to advance labor’s cause if that is what matters to him.
I would selfishly prefer he figure out how to work w/in DL’s structure, even though it is based on very different values because he could make a lot of contributions to DL… but I understand that might not be his choice.
One final word for you, Kev.
I have THOROUGHLY enjoyed our discussion today… less heat, facts, perhaps more understanding of each other’s position than on other days.
I heard Condoleezza Rice speak last night. She said a couple interesting points… one she said she really likes to engage in debate and that is part of what got her through the difficult times in the WH when she had to handle very divergent opinions. I think I know two people who fit her shoes in that regard…. J
Second, she talked about leadership and noted that leaders are people who are never content to believe in today at the expense of the world they believe can exist. I COULD NOT HELP but think of you and your passion for constantly pushing to the next level – and that is commendable. But she also said that leaders have to be optimistic – able to convince others of what the world they want to build CAN look at – and able to win over people – the art of influence.
Interesting perspective from someone who left an impact on the world – and still is.
