Now Mark you are certainly leaving a lot out. Such as the fact there is a process to increase pressure on both sides to move, waiting year after year after year, when you are already at the bottom only puts pressure on the members and serves the company's interests. The mechanics voted down their TA and for the first time I'm aware in any airline sect 6 negotiations of the union did not proceed to the next step, release, then self help or PEB, with the expectation that negotiations continue in the interum. Instead the International, with you as advisor, went backwards to mediation. --Moving towards "self-help" and a Presidential Emergency Board lies in the hands of the National Mediation Board, no one else. It was very clear the NMB had no intention to move the process forward from Mediation.
First off there was never any talk of AA liquidating, that came from Mark Richards and Jim Little as a scare tactic. One of many inaccurate statements Mark Richards made to the Negotiating Committee. --YOU mentioned it was better to liquidate. YOU gave a detailed account as to the advantages of liquidation and looked at it as a saving grace, something that would help the cause of the profession.
Mark Richards told the committee that if we didn’t agree to the concessions that the court would most certainly abrogate and when they did we would have no contract, we would be at will employees, no just cause, no check off, nothing and the company could do whatever they wanted and we could not strike. --That's the BK process.
That was a lie. Court decisions on Airline contracts were clear that the reason why airline workers could not strike is because they did still have a contract, upon abrogation, they impose the terms already proposed by management, that becomes the contract and those terms did not include getting rid of Just Cause or Checkoff and its unlikely the court would consider such demands necessary for the plan. The terms of the ask must meet the criteria that what they are asking for is necessary for the reorganization. The court admitted that if they were to wipe out the contract and have no contract, like everyone else in Bankruptcy, that we could strike. --"It is important to know that Judge Lane has repeatedly said in open court that, unlike the bankruptcy judge in Northwest, if he decides that American Airlines can abrogate our CBA, he does not believe he has the authority to and, therefore, would not put any conditions on the terms that management can put into place after the abrogation. Our lawyers have told us that management could, at worst, impose any term they wanted if our contract is abrogated, and, at best, impose the terms of the April term sheet...Some pilots have speculated that the bankruptcy court’s decision in Northwest would require American to impose only the terms of the June 20 “Last, Best Offer” (LBO) if the court orders rejection. Judge Lane has repeatedly stated on the record that he believes he does not have the authority to approve specific terms as part of his rejection order. American Airlines management has asked for permission to implement the terms of their April 19 proposal — the last proposal they made before the trial began on the 1113 motion. The unions and the Unsecured Creditors’ Committee all argued that Judge Lane does not have the authority to “bless” any particular terms. Judge Lane agreed in open court, stating several times that he thinks that Section 1113 does not give him authority to “bless” any particular terms." APA Communication to Members.
I guess you know more than the APA and their lawyers.
"Flight attendants at Northwest Airlines are not allowed to strike, a federal appeals court ruled yesterday, affirming a lower court ruling and lifting a cloud hanging over the bankrupt carrier. The ruling, from the Federal Court of Appeals for the Second Circuit, protects Northwest from a potentially devastating strike threatened by the workers after Northwest voided their labor contract last year with court permission." --NY Times
I guess you also know more than Federal Judges
My argument against agreeing to more concessions was that we were already at the bottom of the industry, that it didn’t make sense for us to agree to more concessions other than increased outsourcing and the pension because those were the only two things where we were not at the bottom of the industry. The law says that the debtor has to show that the terms were onerous to get the contract thrown out, granted the courts have taken this with a grain of salt but how could they say our contract was onerous when we were at the bottom in pay, vacation, holidays, shift pay, overtime pay, training pay, health benefits, uniforms, sick time, etc etc? --You don't have to agree to anything, but then the Court has the legal right to abrogate the entire contract and the Company can impose their will. I guess that's a better option? You make it sound like there are viable choices within the process. There have been 166 airline bankruptcies and I'd like to study a case in which your theory of rejection of concessions within that process has worked out.
Mark Richard said none of that matters that its not negotiable and that we had to meet the company’s number. (What Mark left out was it obviously was negotiable because the ask went from 20% to 17%) Once again that turned out to be a lie, because around the same time Mark was doing his best to bend us over for the company Pinnicle Airlines, whose pilots were also below industry standard refused to meet the company’s ask in their Bankruptcy case and the Pinnicle sought to have the contract abrogated, and what happened? The Judge refused to abrogate based upon the fact that the company could not prove that a contract that was already below industry standard was onerous and what they were asking for was necessary. He told Pinnicle they had to adjust their ask. Despite the fact we were in the same position as the pilots at Pinnicle we never even tried to make the argument. --Not nearly in the same position, but let's just go over your opinion....
You said, "the Judge refused to abrogate based upon the fact that the company could not prove that a contract that was already below industry standard was onerous....However, the Judge actually said, "Pinnacle’s need for significant reductions in labor costs is profound. Though Delta failed to do everything it could have done to document the extent to which Pinnacle’s labor costs exceed those of other Delta regional carriers, Pinnacle’s own efforts to investigate that issue satisfied the Court that Pinnacle’s pilot labor costs are way over market. And Pinnacle’s liquidity issues make it clear that Pinnacle cannot continue under the status quo. As unfortunate as pay cuts for the Pilots would be, the liquidation of Pinnacle, and the loss of 5,800 jobs, would be far worse."
So, I'd assume you believe it was a victory for the Pinnacle pilots not having the CBA abrogated, but this was the contract they finally agreed to, "The union said the new seven-year agreement includes, among other cuts, a 9 percent reduction in pay for all pilots plus longevity caps to all pay scales which will further cut the pay of more than half of Pinnacle's pilots by as much as another 16 percent. In addition to almost 25 percent pay cuts, the deal also increases health care costs for all pilots while reducing pilot retirement benefits by more than 50 percent for Pinnacle's most senior pilots."
Pilots, sure they gave 17% but 17% is a negotiable number. You keep saying these lies that this and that is not negotiable, that simply untrue, you said the 20% was not negotiable, then it became 17%. The pilots and company met the 17% by adjusting the values of the items that make up the ask. --The pilots were the last group to approve their CBA with the 17% instead of the 20%. (minor detail, I guess)
"On September 4, 2012, Judge Sean H. Lane granted American's renewed motion to reject its CBA with the Allied Pilots Association...The court also rejected the APA's new argument that because American had agreed to a 17% labor cost savings with its other union and non-union employees, American's request for a 20% labor cost reduction from the APA was not necessary to its reorganization."
All the numbers are theoretical appoximations or assumptions to start with, one could argue that a concession is worth more or worth less (something else Mark Richards said we could not do but other groups did) For instance, Mark Richards right hand man, the Economist John Donnelley, (who is now management at SWA) who sat through not only the BK but also was the Economist in 2003 for the TWU and gave us a cost out in 2010 for sick time that was much much higher than the total value he vetted back in 2003 even though our hourly wage was lower and we had 35% fewer workers. In other words when we lost it, sick time was given a much lower total value than when we asked for the same thing back even though both the hourly wage and the number of members was much lower. IIRC getting back to twelve days of sick time would have cost us double to get back with 12000 workers at a lower hourly rate than we were given credit for in 2003 when we were at a higher rate and had over 16000 workers. How was this possible? It wasn’t, the assumptions were changed and that changed the figure, so to say they still got 17% may on the face of it seem factual, but by rejecting the deal the pilots did get improvements, they just didn’t rub it in everyone’s faces and the company buried the additional cost in the assumptions because even the assumptions are negotiable. --The pilots were facing an abrogation that would have meant 20% cuts instead of the 17% cuts already agreed by the other unions. The pilots 17% was accepted after everyone else so to say their abrogation led to a better percentage is just not supported by the time lines. Further, this isn't Section 6 negotiations...it is a bankruptcy and the trigger for the cut from 20% to 17% was the added value of the US Airways merger, as seen by the Creditors.
The pilots also went into BK well within industry standards, they were nowhere near the bottom like us. In BK, the threshold for cuts isn't compared to the standing one group has within their industry.
The Creditors are now the shareholders and they are always in charge. So their status is no longer a creditor, they are owners. Owners of corporations do not determine each mangement decision on the day to day management of the company, not every contract is brought back to the shareholder/owners, they can fire managers for agreeing to bad contracts and poorly managing the company but they don't have the same decision making power in the business plan as a Creditors committee in Bankruptcy.
Where did I say that all you have to do is ask and you will get it? I will say that if you don’t ask that you probably wont get it, but according to you we shouldn’t even ask because they might get mad. --I'd like to see where I said that.
BTW AA isn’t in BK anymore. So any deal cut in BK can be renegotiated as long as both parties agree. You would think that would be obvious enough with the fact that you were out there saying how we could get new deals with the JCBA. In their NPA the language was silent as far as the term. The creditors committee agreed to the NPA and the NPA opened the door. --Technically, the AMR BK is still an ongoing court process. Nevertheless, the company is bound by the Plan of Reorganization which runs for 6 years and it's the reason for the need of cost certainties in all the union CBA's. It is also the reason for the agreement of arbitration by the APA and APFA as the merger came with certain needed positions sought by the Creditors in order to go along with the merger within the BK process. All this stuff isn't done in a vacuum, as much as you might hope it is.
All I can say is if you want to pay a lawyer to entertain you and crack jokes, hire Mark Richard, if you want a lawyer who is going to help the company get whatever they want and give you bad information, hire Mark Richard, but if you want a lawyer who is going to fight to make sure you get the best deal possible and give you sound legal advice, DO NOT HIRE MARK RICHARD. --So who is the lawyer that achieved better outcomes in an airline BK? It's fine to lambast someone you don't like such as Mark Richard, John Donnelly, Tom Roth, Sharon Levine, Judge Sean Lane and a whole host of characters...who do we replace them with? Who would have afforded a better outcome? (before you type, "anyone," think again...that's too easy)
