It's official!

[AANOTOK]

 
Well, again, the union didn't "agree" to a "reduced contract" per se when they signed the negotiating protocol.  As the APFA has said again and again to anyone that would listen, what they agreed to was binding arbitration that would produce a contract that was "market-based in the aggregate."  The APFA didn't expect that the negotiated TA with the company would be worth - by both the company's and union's math - $80M+ more (annually) than "market-based in the aggregate."
 
Nonetheless, either way, the binding arbitration was apparently a required "cost of admission" for the APFA to get what they really wanted most of all - which was rid of Tom Horton & Co.  As Glading, et al have explained, the creditors committee was unwilling to entertain any merger proposal(s) unless and until the unions agreed to a binding arbitration backstop that provided clarity and at least some degree of certainty on a realistic timeline for joint contracts post-merger, and a realistic estimate of projected post-merger labor costs.
 
So the union made the decision - rightly or wrongly - to accept binding arbitration coming out of the merger in order to get the merger itself.

I was told that the TWU did not have binding arbitration in their agreement. Bob can correct me if I was given the wrong information.

 

[MetalMover]

I was told that the TWU did not have binding arbitration in their agreement. Bob can correct me if I was given the wrong information.

You are correct:
 
All,
 
I have been asked about the NMB decision as well as joint negotiations by a few people today.
 
1)  When will we receive the NMB decision?  The answer is the NMB, like any government agency, will answer when they believe they have made a legal decision under federal rules and laws.  No time period is available.
 
2)  Do we, TWU, have a binding arbitration clause like APA and APFA in negotiations?  We do not. It is important to remember that IAM did not negotiate with TWU during the merger to achieve a joint MOU, IAM believed argued they were in negotiations and needed a contract first.
 
3)  Is it better to have a binding arbitration or not?  That is a nearly impossible question to answer, each negotiations comes with its own challenges.

4)  When will joint negotiations start?  That cannot be determined until single carrier representation status is determined.
 
5)  Are we going to submit contract proposals before negotiations?  We are working on a comparison chart of the airlines, not just the AA and US Airways CBA's, for our members to use as a guide in producing the best contract proposals. 
;
 
;
 

 

 

[AANOTOK]

I personally think it would be better not to have binding arbitration...
Thanks MetalMover

 

[IORFA]

The FA NO voters really hoodwinked DP and the gang by voting down their TA. Now the FAs will have a 5 year deal at a lower pay rate, and no profit sharing. The NO voters really taught DP. A lesson.

Same exact TA is coming, just that top pay is now $3.35 less. Again, MORONS! Everyone has a different meaning of the phrase "industry leading". However, this was AA "leading". No reason to work under the exact same contract for less money. Damn MORONS!!! No, I'm not bitter. Just flew with some doozies. Not one person saw the APFA's arbitration proposal from last Friday. One still thought we would get more. I informed her that the contract will be EXACTLY the same with the "hard" 40, except less $. She was shocked nobody ever explained it to her that that would happen. I can't make this cr@p up. I truely work with some seriously stupid people! 3 dozens idiots standing outside HDQ with signs is going to do NOTHING!!! Idiots. Thanks for having zero brains!!!!!

 

[IORFA]

I sure wish this "moral victory" spent at my local grocery store!

 

[Duke787]

We would be better off without unions, too many know it alls, too many apathetic non voters, effect us negatively.

 

[eolesen]

We would be better off without unions, too many know it alls, too many apathetic non voters, effect us negatively.

Yep. Without a union, you might actually be paid like DL is.

 

[Bob Owens]

Yep. Without a union, you might actually be paid like DL is.

Not with these guys, without a Union they would try and pay us like America West, or Virgin Atlantic. 

 

[OldGuy@AA]

Not with these guys, without a Union they would try and pay us like America West, or Virgin Atlantic. 

Bob we actually are America West.  All the crap they are pushing on us like the D2R for retirees and 8 days use em or lose em sick benefit come straight from America West.  

 

[Bob Owens]

 
Well, again, the union didn't "agree" to a "reduced contract" per se when they signed the negotiating protocol.  As the APFA has said again and again to anyone that would listen, what they agreed to was binding arbitration that would produce a contract that was "market-based in the aggregate."  The APFA didn't expect that the negotiated TA with the company would be worth - by both the company's and union's math - $80M+ more (annually) than "market-based in the aggregate."
 
Nonetheless, either way, the binding arbitration was apparently a required "cost of admission" for the APFA to get what they really wanted most of all - which was rid of Tom Horton & Co.  As Glading, et al have explained, the creditors committee was unwilling to entertain any merger proposal(s) unless and until the unions agreed to a binding arbitration backstop that provided clarity and at least some degree of certainty on a realistic timeline for joint contracts post-merger, and a realistic estimate of projected post-merger labor costs.
 
So the union made the decision - rightly or wrongly - to accept binding arbitration coming out of the merger in order to get the merger itself.

 
 
OK $80 million more than the aggregate based upon contracts that all become amendable by 2016 for a contract that doesn't become amendable till 2019.
 
Ok so divided by $21000 flight attendants that comes out to $3809.52 per year.
 
$80 million comes out to around 5.5% based on an average of $70k (including benefits etc) . Thats how much this contract would have put APFA above the market aggregate, but what happens from 2016 through 2019? Thats at least three years where all Delta and UAL need to get is 2%/year and APFA will be back at the bottom not including what the other FA's are likely to see in profit sharing.
 
How much Profit sharing did Delta workers get last year? I've heard of profit sharing numbers as high as 15% which would net them more than double the $3809. With multi billion dollar profits I doubt they will settle for 2% increases either. 
 
Blaming the Creditors Committee for the binding arbitration is weak, the Creditors Committee wanted this just as much as the Unions did, and if it was so essential then how come they didn't demand binding a binding arbitration agreement from the largest union on the property? I believe that after sitting in negotiations for four years the APFA wanted a defined timeline, they gave away far too much to get it. If they had said No the merger would have gone through anyway. 
 
Like I said, everybody seems to have forgotten what happened in the 90s. 

 

[Bob Owens]

Bob we actually are America West.  All the crap they are pushing on us like the D2R for retirees and 8 days use em or lose em sick benefit come straight from America West.  

I agree thats where they are trying to take us.
 
We still have our sick time because we have a Union. Thats something. To me its worth nearly $30k. 

 

[Bob Owens]

One big exception to that general rule: Arpey and his emotional/moral/philosophical objection to bankruptcy. Between May, 2003, and November, 2011, while he was CEO, he occasionally mentioned bankruptcy and it was clear from his comments that he was opposed to it. That was his big exception to the general rule of "ignoring emotions and sticking with the numbers." He rationalized his objection by arguing that avoiding Ch 11 and not terminating the pensions in 2003 would payoff for AA in the long run with happier employees. He missed that prediction by a mile, however.

Maybe you believe that BS line about a moral objection but I don't. He rode out the 2003 agreement and the 2006 pension extension scam till they squeezed out every penny of savings they possibly could. And he walked away with a $20 million windfall as a result. 
 
AA was paying less per person for pensions than any of their competitors, they admitted that in negotiations there was no dollar value on switching over to the 401K because the current pension plan under the revised rules required less than they expected to pay into the 401k, and that was with 25% not costing them anything at all because thats how many they figured would not even get a match. (They did admit that in the future they would have to pay more) He was able to squeeze three zeros out of his workforce as he jacked up medical premiums subjecting his employees to a double whammy and cleared IIRC $10 billion in debt along with amassing $5 billion in cash. In other words he set the place up to go into BK where the only people that would be getting screwed were the employees. 
 
I don't see a halo around Arpeys head, I see horns. 

 

[commavia]

$80 million comes out to around 5.5% based on an average of $70k (including benefits etc) . Thats how much this contract would have put APFA above the market aggregate, but what happens from 2016 through 2019? Thats at least three years where all Delta and UAL need to get is 2%/year and APFA will be back at the bottom not including what the other FA's are likely to see in profit sharing.

 
Well, okay, but again - "what happens from 2016 through 2019" wasn't really on the ballot.  As has been explained countless times - the AA FAs only had two choices: the TA or binding arbitration guaranteed to be worth less in the aggregate.  Those were the only two choices.
 

How much Profit sharing did Delta workers get last year? I've heard of profit sharing numbers as high as 15% which would net them more than double the $3809. With multi billion dollar profits I doubt they will settle for 2% increases either. 

 
There are pros and cons to profit sharing.  The APFA leadership, and many FAs, clearly believe that given their past experience and personal risk tolerance, they would prefer the certainty of money in their regular pay check rather than the chance of profit sharing down the road.
 
It's great in times of profit, and it appears that some believe profits will be infinite going forward.  I'm a bit more skeptical.
 

Blaming the Creditors Committee for the binding arbitration is weak, the Creditors Committee wanted this just as much as the Unions did

 
Fascinating that Laura Glading (among many others) "read the room" differently when discussing and negotiating with the UCC.
 

if it was so essential then how come they didn't demand binding a binding arbitration agreement from the largest union on the property?

 
Perhaps, given past history, the UCC felt a bit more confident about it's ability to get a "competitive" joint contract with the TWU than with the APA or APFA?
 

I believe that after sitting in negotiations for four years the APFA wanted a defined timeline, they gave away far too much to get it. If they had said No the merger would have gone through anyway. 

 
And that's certainly an understandable and reasonable perspective - no doubt shared by many flight attendants.  Unfortunately, the time to have affected a change to the APFA's negotiating strategy would have been 18-24 months ago.  By the time November 2014 rolled around, the die was cast - for better or worse.  The APFA agreed to binding arbitration and as such the FAs had only two choices in front of them.  There was no mystery curtain #3 to peak behind.
 

Like I said, everybody seems to have forgotten what happened in the 90s. 

 
Indeed.  "Everybody" (i.e., some) seem to have forgotten how bad the airline industry was doing in the early 1990s - when it lost the most money in its history up to that point.  Not sure how everyone would have felt then about having forgone bigger paychecks in exchange for non-existent profit sharing.

 

[Duke787]

Not with these guys, without a Union they would try and pay us like America West, or Virgin Atlantic.

AA tried to pay the FAs more, but the FAs outsmarted AA and refused to take it. Just like we outsmarted AA in 2010 by turning down the TA. Who needed that extra $40k extra vacation more sick time.

I don't see a problem with the company, the problem is the loud mouth know nothing's who turn down money because they think they're all knowing.

 

[bigjets]

Bob we actually are America West.  All the crap they are pushing on us like the D2R for retirees and 8 days use em or lose em sick benefit come straight from America West.

Did AA come after sick time during BK ? If they really wanted it, they would have taken it.

In the FA'S TA, they went from 1000 to 1500 bankable hours, 24k FA's and there are 7300 mechs.