How Low Does Employee Pay Have To Go?

[CynicalResAgent]

I am kind of new to this board but I want to know how low does Siegel and team need (not want) us to go to make a profit. I am not asking to make anyone upset because I know pay cuts and work rules are a touchy issue.

I have a couple of questions -

I am not suggesting it, but say for example, what would happen if all the Unions adopted their WN Union couterparts contracts word for word. How would that affect the Pilots, FA, mechanics and CS? (I am CWA and I have no clue but think I might make more per hour but do not know about everything else.) Would this mean layoffs, more hours working per day, higher medical, less vacations? Would the company still not be profitable because we fly through hubs? Or is it management pay that would still keep us in the red (do they have a leaner HQ)? I know they save money by direct booking.

Second, I honestly want to know, we used to always see us being compared to WN but now it is B6 that I see us being compared to in the corporate bulletins. I know we have a higher ratio of personel vs Aircraft, but does not an A330/767 require more personel than a 737? (Meaning if you use a weighted the average are we still higher than WN - 1 A330=1.5 737 for example). What I am getting at is that I would like to know when will labor have given enough? Since we (unions) are supposed to have board members, and they should have access to "the real numbers", then can they not do an analysis and see what it will take to get us back into growth mode. Or is WN pay not low enough based on our business model?

Honestly, if someone gave me the chance to take the WN Rec contract I would take it just so I would not have to open another depressing letter from my CEO. Dave's letters can drive a person to prozac! I am not bashing management but whenever something appears in the mail from the copamny I get a feeling of dread before I open it, and sometimes after.

 

[wings396]

As a FSA, I would love to have WN's contract. No more Mainline Express, and we would all get a hefty raise to the tune of $23+ an hour. The company knows this and that is why they have shifted to comparing us to B6 instead with their junior workforce. The CSA & FSA groups would benefit greatly under WN's contract, but the Pilot and MTC groups would not as their headcount would be severly reduced.
WN has a larger fleet with less MTC and Pilots, and this is why we will not see these groups agree to a WN type contract. As far as how low they want our wages to go, I hope they leave the 30k and lower folks out of it. If it were not for the Medical benefits, unemployment wages would be equal to what some of us now earn working a F/T job here.

 

[DCAflyer]

Okay, let's play with this. I did a little quick research and I will throw out some raw data comparisons between US AIRWAYS and SOUTHWEST. I don't have time to analyze this this morning, but I will tell you what I found and perhaps we collectively can figure out what management has been unable to do so far. I suspect they have used some of the same data I am presenting here, but are manipulating it in such a way that benefits them.

US AIRWAYS has:
28,381 Employees
279 Aircraft
40,612 revenue seats
145.6 average seat count per A/C
43.3% of fleet is Airbus, supposedly more cost-efficient than Boeing

The above equates to: 102 employees per A/C and 0.7 employees per revenue seat.

SOUTHWEST has:
35,000 Employees (approx.)
381 Aircraft
51,432 revenue seats
135 average seat count per A/C
All Boeing fleet, supposedly less cost-efficient than Airbus

The above equates to 92 employees per A/C and 0.68 employees per revenue seat.

A couple of more facts on the LUV website: LUV's average fare is $86.23. What is U's?

LUV's average trip length is 729 miles. What is U's?

My quick conclusion, when you look at headcount per available seat (the criteria management keeps throwing in our faces), is that we are VERY MUCH on par with LUV. Of course our headcount per A/C is higher because we have larger planes.

 

[mbmbbost]

LUV's average trip length is 729 miles. What is U's?

I am curious, is the trip length determined by the total distance of a trip or are segments counted as separate trips? I keep thinking that U's habit of forcing traffic (that ought to be point to point) through the hubs has to be hurting the figures big-time...

 

[700UW]

You have to remember you can't really compare WN to US, Southwest vendors out 72% of their maintenance, the do not yet perfrom total overhaul of thier aircraft and don't overhaul or repair as many compontents as we do.

 

[DCAflyer]

You have to remember you can't really compare WN to US, Southwest vendors out 72% of their maintenance, the do not yet perfrom total overhaul of thier aircraft and don't overhaul or repair as many compontents as we do.

So then we are effectively doing the same thing, seat for seat, with fewer people, because if they didn't outsource maintenance, they would need to hire more people. If we are at 0.7 employees per seat and they are at 0.68, they would need to hire a few thousand mechanics if they suddenly stopped outsourcing.

One other thing bears mentioning. Southwest is probably above the 0.68 figure because their website says they have "over 35,000 employees" so I didn't have the exact figure. U lists the exact figure, but who knows how up to date it is. We don't know how many people they fired yesterday.

Do we have a way of getting our hands on their labor contracts so we can do actual comparissons, job desciption by job description? Are they on the web? If we can compare say a 10 year flight attendant here with a 10 year over there, and the same with mechanics, fleet service, etc., it would really help compare apples to apples.

A major reason our labor expenses are higher is we have more senior employees. If the company would offer decent incentive packages for early retirement, we could probably get several thousand topped-out folks to take it and bring back junior people at lower pay.

 

[johnnyfleet]

Southwest's Ramp contract


Well here is the link to Southwest's Ramp contract, I know every US Ramper would much rather have this than what we have. Higher percentage of full time employees (they currently have no part time, even though their contract allows a small percentage of the work force to be part time) Much higher wages, and stronger work rules, and better vacation than US Rampers have. I'll sign up now!!

 

[tadjr]

cwa.net 12/17/03

In the coming "Battle for PHL" US Airways execs have a big passenger service cost advantage over Southwest Airlines...
US Airways execs have a big advantage over Southwest in the Battle for PHL. Southwest passenger service salaries are currently about 6% higher than US Airways', and in the years from now until 2008 they will range from 9% higher to almost 19% higher, depending upon the year. This is an incredible cost advantage for US Airways execs over Southwest.
To put this into perspective, US Airways execs will spend an average of $5,772 less than Southwest per agent, per year, at top rate.
When you multiply that by the entire passenger service workforce (about 6,000 agents and reps) US Airways will be spending an average of $34.6 Million per year less systemwide than Southwest for passenger service salaries at top rate.
The very large advantage in passenger service employee salaries, along with the concessions made by other US Airways employee groups, should allow US Airways executives to devise a business plan that will defeat Southwest at PHL.
The message: We gave our executives the tools to compete - now it's time to produce a winning business plan!
In future bulletins we will outline the other passenger service benefit and workrule advantages US Airways enjoys over Southwest.

 

[robbedagain]

I'll bet that it is probably a lot easier to jump on a SWA plane than it is to fly as a non-rev on usair! plus from what I've heard that their employee morale is a lot more up than US! But I dont think SWA will quit the PHL market. I think they coming in knowing full well what to expect and that is to take our pax away from us by their cheap fares

 

[Fatherknowsbest]

What is the motivation to beat SW in PHL even if we could?

The average South West employee has a stock option account worth over $100,000. They also have a very nice profit sharing plan (They do make money). And a retirement plan.

If we succeed then Siegel makes a mint and we make what?

What I am saying is simple. The Southwest employee is MOTIVATED to the max to kick our butt. Just like they did in BWI! The SouthWest employee is motivated in a positive way to save their standard of living. They will fight very hard.

We are motivated by what? Fear I guess................How hard am I/are we going to fight to line the pockets of Dave and Dave with cash?

Most U employees won't take much of a paycut even if we have to start over somewhere (except for Pilots) else. Our Unions already gave our futures away over MidAtlantic.

The fight is over before it even gets started. It didn't have to be this way.

Our major competition will beat us senseless because Management of SouthWest and JetBlue have decided the only way to make it in today's airline industry is to share the wealth with all of their employees. Our Management wants to have it all for themselves. This is why they will never win!

 

[CynicalResAgent]

if we succeed then Siegel makes a mint and we make what?

What I am saying is simple. The Southwest employee is MOTIVATED to the max to kick our butt. Just like they did in BWI! The SouthWest employee is motivated in a positive way to save their standard of living. They will fight very hard.

We are motivated by what? Fear I guess................How hard am I/are we going to fight to line the pockets of Dave and Dave with cash?

Most U employees won't take much of a paycut even if we have to start over somewhere (except for Pilots) else. Our Unions already gave our futures away over MidAtlantic.

I understand what you are saying but I do not agree with that attitude 100%.

We all have stock in this company. Albeit, it is not worth much right now. We all have a stake in this company because we all do not want to look for another job right now or we would have already moved on.

While I do not agree with the way management has made the employees feel, I think we still need to be aware that if the company could be profitable right now then we would be. It sounds like it is not employee pay but rather productivity. If it would only take work rule changes then maybe we should look at the work rules. I just would like to know what it will take to turn this company around. If the company asked for us to change work rules in exchange for a no furlough clause and intentions to grow the company I would vote yes.

Do I trust managements intentions? No, I do not think that this management cares about or values me as an employee but I do think they want to save the company. I will work with them within reason for my own good, not theirs. It is obvious that if things stay the way they are right now then a year from now we will have to chat about US on the "airlines of the past" board.

 

[usfliboi]

Guys the bottom line is here Dave has not nor has any one said there will be a pay cut. Everything on the table i believe means productivity cuts..... Not per hour cuts. Sw agaisnt us minus pay , there is a big difference. Way of life and other things in both contracts are way different. Some have to do with the way our company is structured and contract would have to change to honestly compare apples and apples. I think Dave and co will ask for some contract relief and will get it or force in bk one way or the other I ll give it to the guy hes determined to save this company. The things he is doing from a buisness 101 perspective are right on target. Thats why he has total support from investors mainly D bronner. DO I LIKE IT?NO! But if he is to return this company to profitablity hes gonna have to continue no doubt. In the mean time we gotta just keep trying .

 

[4merresrat]

What is the motivation to beat SW in PHL even if we could?

The average South West employee has a stock option account worth over $100,000. They also have a very nice profit sharing plan (They do make money). And a retirement plan.

If we succeed then Siegel makes a mint and we make what?

What I am saying is simple. The Southwest employee is MOTIVATED to the max to kick our butt. Just like they did in BWI! The SouthWest employee is motivated in a positive way to save their standard of living. They will fight very hard.

We are motivated by what? Fear I guess................How hard am I/are we going to fight to line the pockets of Dave and Dave with cash?

Most U employees won't take much of a paycut even if we have to start over somewhere (except for Pilots) else. Our Unions already gave our futures away over MidAtlantic.

The fight is over before it even gets started. It didn't have to be this way.

Our major competition will beat us senseless because Management of SouthWest and JetBlue have decided the only way to make it in today's airline industry is to share the wealth with all of their employees. Our Management wants to have it all for themselves. This is why they will never win!

I find in hard to believe that the "average" southwest employee has a stock portfolio of "over 100.00." What do you base this on?

 

[cavalier]

In the mean time we gotta just keep trying .

Trying to do what? Does that statement mean we are not doing our jobs, that we stopped trying? Trying to stay mentality healthy with yoga or something? Trying to ignore what is going on around us everyday with gloom and doom being talked about in every corner? Trying to be passive while this management team incessantly delivers to us all the woes U faces and that we are only seconds from extinction? Trying to keep a stiff upper lip while you stagger amidst the gothic surreal reality that being a U employee creates? In other words, what the hell do you mean????

 

[CynicalResAgent]

I agree. It looks like pay is not the problem. I do not want to give anymore but I will give on the productivity side because I would like to see the company succeed for my benefit. If I get laid off I will still want to see the company suceed for the remaining employees. While I understand where the "close the shop" mentality comes from I think it is too negative and hurts everyone (employees, owners and customers.)

I will do what I have to do to see US suceed and if they ask me to do more than I feel that I can I will just leave.