Pilots approve American Airlines contract on second try

[Bob Owens]

The lump sum option in our plan was unilateral removed in mid 1980's
I worked for a crew chief that was one of the last to get that option.

My mistake, I meant 1983. I remember some of the managemers getting it.

 

[TWU informer]

My mistake, I meant 1983. I remember some of the managemers getting it.

Actually Bob it was 1986 or 1987
It was unilaterally removed by Management mid-contract due to weak language about IRS changes allowing AA to alter the plan.

 

[Buster CRC]

I believe the final day of lump sum ended on Dec. 31, 1988 for mechanics. I remember an inspector retired the year my shop moved into the Cam building and he was the last to get it.

 

[Bob Owens]

Actually Bob it was 1986 or 1987
It was unilaterally removed by Management mid-contract due to weak language about IRS changes allowing AA to alter the plan.

Not sure, as a twenty something wasnt too concerned about it but I just remember one of the managers retiring and getting it, and being told we wouldnt. Was hired in "86" so "88" would sound right. The manager was not well liked, Supervisors were going around for a collection for him so the fact that he was getting a lump sum was all over the field. When I declined to contribute the Supervisor said thats pretty much the same response he got from everyone else and if he wasnt in management he wouldnt give either.

 

[AirwAr]

I don't remember hearing that the previous TA was a 17% cut. If it was shown to be a 17% cut...I agree with you...not much changed with this one. I just don't see how allowing for a few more hours of flying, allowing regionals to fly more 70 seaters....although I'm not sure they're allowed any more RJs in total. Codeshareing on Alaska & Hawaiian, which we already do. I'm just curious how they got to their 17%.

Mind you...I'm not cutting down the pilots at all, actually I'm happy for them...I'm just curious how management will sell this to the rest of the "17 Percenters"

If the following is true, I retract my "not much changed" statement. If the previous TA was a 17% cut...then this agreement is surely less than that. A better Scope Clause and higher pay for the A319 pilots...how can it possibly be the same 17% cut? I think if I were the other unions...I would be pushing to review that "me too" clause again.

http://www.huffingtonpost.com/skift/american-airlines-contract_b_2265201.html?utm_hp_ref=business

1. Scope clause: The new contract includes a scope clause that states aircraft with 76 seats or less can be outsourced to regional airlines like American Eagle. In August, American Airlines proposed that flights with 88 or fewer seats could be outsourced -- a huge jump from the 50-seat cap currently in place. The agreed 76-seat cap is similar to those of American's competitors like Deltaand United Airlines.

2. Furlough protection: The approved contract included a clause that protects every pilot currently on the seniority list from being furloughed. The seniority list includes every actively flying pilot in the order that they joined American Airlines. The clause adds a layer of job stability for pilots despite regional outsourcing.

3. Pay for Airbus A319: The approved contract also increased pay rates for pilots that will fly theAirbus A319 aircraft when it joins the AA fleet in 2013. Pay rates detailed in the contract in August were significantly lower than the rate that was approved.

 

[FWAAA]

If the following is true, I retract my "not much changed" statement. If the previous TA was a 17% cut...then this agreement is surely less than that. A better Scope Clause and higher pay for the A319 pilots...how can it possibly be the same 17% cut? I think if I were the other unions...I would be pushing to review that "me too" clause again.

The problem with the Huffington Post article is that some of its comparisons are between the Term sheet and the ratified TA, but the 17% cost savings were based on the failed LBFO, and the ratified TA is in most cases virtually identical to the LBFO. Take scope, for example. The LBFO provided a max seat limit of 79 (the 86 is from the term sheet) and the ratified TA cut that back to 76. While that's a "victory" for the pilots, it's not one that will increase AA's costs (or reduce AA's cost savings), unless you assume that AA will now order some 79 seat RJs and fly them at mainline rates. Since everyone knows that won't happen, the slight reduction in seat count is irrelevant for costs - it only serves to limit AA's flexibility in the event it wanted to fly a 79 seat large RJ at Eagle and now it can't.

The furlough protection won't increase AA's costs - when the judge refused to abrogate on the basis of removing the furlough provision entirely, he ruled that AA didn't need that to compete (and it wouldn't reduce AA's costs anyway). So that change isn't going to alter the 17% savings.

Moving the A319 and 73G into the next larger pay band might increase AA's costs slightly, but AA can minimize those increased costs by buying fewer A319s. With the terrible economics of the A319 and 73G (compared to their slightly larger siblings), it wouldn't make much sense for AA to buy very many of the smaller narrowbodies. Still, AA's costs will increase slightly for every one it buys, so that's an area where the APFA and the TWU can claim some me-too additions.

IMO, the me-too amounts from the ratified TA won't be worth the money spent to investigate how much they altered AA's costs - the ratified TA just isn't all that different from the LBFO (on which the 17% savings originated). There will probably be some very small adjustments made to the APFA and TWU agreements, but it ain't going to amount to a hill of beans.

I'm sure that Glading and Little will get right on it, but don't take on any new debt based on the improvements you'll see from the tiny me-too adjustments that will result.