At least the Association is right on one thing this is unacceptableTeam,
In an effort to reach a joint collective bargaining agreement (JCBA) with the TWU-IAM Association, in mid-July we presented the Association with a proposal that covers all remaining open items of the collective bargaining agreement. In Railway Labor Act (RLA) negotiations, offering a comprehensive proposal is usually one of the last steps in the negotiating process.
We have yet to receive a response to our comprehensive proposal. The Association has indicated it intends to fully respond to our comprehensive proposal in early October after the TWU National Convention. In the month since we presented our offer, a lot of rumors have been circulating about what is and isn't included, and we thought it made sense to provide the facts.
It is important that you have accurate information. Our approach to these negotiations is different from how the company has bargained in the past. We aren’t presenting a low-ball offer knowing that more benefits would be added after rounds of back and forth at the table. We want you to have an overall industry-leading contract and have put forward a proposal that would do just that. It is a proposal that:
Gives team members the highest pay rates in the industry. You received industry-leading (the better of Delta and United) pay rates in August 2016 when we implemented significant pay increases before a JCBA was reached. Our proposal offers additional increases that keep your pay rates at the top of the industry (current Delta plus 3%) along with increases in premiums and shift differentials, plus annual increases for the duration of the agreement.
Provides significant improvements to holidays and time off. In the areas of overtime, holidays, vacations, sick and shift premiums, our proposal offers the more generous of the current TWU or IAM contract – for example, double time pay for working all eligible holidays, including Memorial Day and Labor Day – or in some cases, improvements that match the industry’s best.
Provides a company 401(k) contribution and a company match that are as rich as the industry’s best. Under this proposal, all TWU-IAM-represented team members would participate in the company’s 401(k) plan that has potential for greater contributions than were available under the IAM multi-employer pension plan or the current 401(k) plan available to TWU members. We have proposed an automatic company contribution of 3% plus a 401(k) match of up to an additional 6% of a team member’s salary – a total of up to 9%.
Moves TWU-IAM-represented team members to the same medical plans as all other employees. We’ve proposed that legacy US Airways Fleet Service and Tech Ops team members move to the same medical plans that already cover TWU and everyone else at American. The company covers roughly 80% of the cost for medical coverage, while the employee takes on 20%. That is a terrific ratio especially when compared to other large employers. Preventative care visits and eligible tests, and eligible vaccinations, cost $0 for enrolled team members and dependents. Lastly, the US Airways PPO 100/90/80 plans are not sustainable, which is why all other team members – including tens of thousands from legacy US Airways – have already moved to these medical plans. Currently 80,000 of American’s more than 100,000 team members are managing their health under the new plans.
Keeps our core Maintenance and Fleet Service work at American. Today American does a lot more work in-house than any of our competitors. That will remain the case under this proposal. Over time, we need to evolve the types of work we do in-house to become more competitive and focus on areas critical to running an airline. With any of the proposed scope changes, all of which are outlined below, we have offered job protections to ensure that everyone working on the property today will have a job tomorrow. And if your duty assignment changes, you will not have to move to a different city to keep your job.
We are currently operating in 40 stations where either LUS or LAA team members perform mainline Fleet Service work, which is more than any other legacy carrier. We are proposing insourcing any mainline Fleet Service work currently done by a third party at those stations. Using limitations in the existing contracts, and providing new protections for some types of work, we will continue to insource more aircraft maintenance work than all US operators including our primary competitors, keeping our existing AMTs and Related team members busy working American aircraft, engines and components.
Deicing needs, on the other hand, vary based on unpredictable weather. We propose moving deicing to a vendor who focuses only on that function. They have advanced technology and the ability to flex staffing when needed without taking our Fleet Service team away from their regular duties. The same goes for catering – third parties manage catering at all but five of our stations, so we are proposing those five stations move to a vendor. That way the work is handled by a company that lives and breathes catering.
For GSE and Facilities and Plant Maintenance, we are proposing to continue that work in stations where we do it today, but have the option to transition some work to a vendor in the future. At 10 locations (primarily hubs and base maintenance locations) American will continue to perform the majority of GSE maintenance work that is core to our business – e.g. maintaining and repairing essential ground equipment. For Facility Maintenance at select stations, we will continue to repair and maintain operationally critical equipment and systems, such as bag belts, jet bridges, etc. But for things like painting facilities, we plan to transition that work to external contractors. Mechanics performing that work today will continue to do so, but as team members retire or leave the company we will not hire new employees to perform that work.
We’re very proud of our proposal. While some elements may not seem as favorable as a similar provision at another airline, what’s on the table is an industry-leading contract overall that would cost American significantly more than implementing either the Delta or United contracts. Everyone will receive increases to their overall compensation, and no one will be out of a job to fund those increases. For the first time in a long time we are consistently profitable; that translates into hundreds of millions of dollars a year in pay and benefits to provide TWU-IAM-represented team members with the industry-leading contract you deserve.
We are meeting with the Association the weeks of Aug. 28 and Sept. 11, but the current plan is to discuss only non-economic proposals until after the September TWU National Convention. As always, we continue to be available to meet with the Association’s negotiating team to discuss or answer questions at any time.
These are important times. We are committed to creating an environment that cares for our frontline team members, and transitioning our TWU-IAM team to a single, industry-leading contract is an important step to achieving that objective. We appreciate everything you all do for our customers and your fellow team members. We’ll share additional information on these proposals or negotiations in the future but for now, thank you for taking the time to understand the facts, and please let either of us know if you have any questions or comments.