Reality Check!!!

[WXGuesser]

[blockquote]
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On 3/15/2003 619 PM j7915 wrote:

The customer does not have to subsidize the "high" wages, (high compared to what? A plumber on a weekend?), of airline employees. [/blockquote]


I'll take a stab at that one... high as compared to what the average Joe Sixpack makes. To wit:

According to the Department of the Census's Wage Survey, median household income in 2001 (the most recent year for which data is available) was $42,228. (Source: White House Economic Briefing Statistics website http://www.whitehouse.gov/fsbr/income.html). Keep in mind this data takes into account everybody, including Bill Gates, Julia Roberts, Don Carty, Herb Kelleher, bagsmasher, WNP, all the two-income families, all the people out there working three jobs just to keep a roof over their heads, the pimply-faced kid who serves you your Big Burger Supersized Extra Value Meal with cheese fries and a Diet Coke, you and me!

How many of you out there make more than that per year? I bet I see a lot of hands raised. Had I not been furloughed, I would have been raising my hand too. Anything above the median household income can logically be considered "high" wages, in that you make more than 50% of the households in the U.S.

I am not saying that airline employees do not deserve to make excellent money based upon the skills and experience they have. And I know there are a lot of airline employees who make less than that (maybe not anymore since they RIF'd all the junior people). But the next time you begin to grouse and complain and whine, think about that number.

$42,228.

OK, rant over...

TANSTAAFL

 

[Hopeful]

wxguesser:
How much of a paycut and concession is enough? Spare me the "lucky to have a job crap." That pimply face kid working at Burger King still lives at home with his parents of which his father works for an airline and is being forced to live on reduced wages and benefits. That pimply faced kid will have to continue to work at Burger King, go to a local college, and stay at home so he can help his parents pay for his own schooling.

 

[KC tirechanger]

Let's put it this way! Back when I hired on with TWA in the early sixtys, you could buy a brand new Chevy, or Ford,with all the bells and whistels for about $3,200! The price of gas was about $.32@Gal! I made about $3.20@HR! The price of a round trip ticket from L.A. to N.Y. was about $200.00! Today, the cost of that new Ford, or Chevy. is at least $25,000! The cost of gas to put in it? Let's not get into that one! Yes,I'm making a little more than I was then, but so is everyone! But guess what! The price of that round trip ticket, is the same, or less,if you shop arround!!!

 

[NYPD]

And speaking of safety, this article is in today's Charlotte Observer...

Crash puts spotlight on contracts
Maintenance link for Flight 5481 scrutinized
TED REED, AMES ALEXANDER & CHARLES LUNAN
Staff Writers

Loaded by one company, flown by another and maintained by a third that hired from a fourth, US Airways Express Flight 5481 was a testament to the increasingly common practice of jobbing out work in the airline industry.

But its Jan. 8 crash at Charlotte/Douglas International Airport, which killed 21 people, has raised new questions about whether third-party maintenance is always a reliable method for assuring airline safety.

The National Transportation Safety Board, which is investigating the crash, will "most certainly" look at the uncommon arrangement under which Flight 5481 was maintained, said a source familiar with the investigation.

Air Midwest flew the plane for US Airways and, under federal regulations, was responsible for maintenance. But it's unclear how closely Air Midwest was able to monitor maintenance work done on the plane by other companies.

A key question is whether the sequence of events that preceded the crash would have happened at a more traditional airline maintenance hangar, where the airline's permanent mechanics have their work overseen by a safety inspector with fewer additional responsibilities.

The NTSB has said the flight control cables on the Beech 1900 were improperly adjusted two days before the crash, which happened 37 seconds after takeoff.

The Charlotte flight marked the first time the plane was fully loaded following the adjustment, sources said. A full load would have meant that the pilots required more response from the flight control system.

The work was performed in a small hangar at Tri-State Airport in Huntington, W.Va., where Air Midwest contracted with Raytheon Aerospace LLC to maintain its planes, and where Raytheon used an Edgewater, Fla., employment contractor called Structural, Modification and Repair Technicians Inc., or SMART, to provide staff. The shop had been open for six months and employed about a dozen people.

The management structure is unusual because the Federal Aviation Administration, which oversees airline safety, allowed the hangar to operate under Air Midwest's certificate, but other companies provided all but one of the workers.

Air Midwest declined to comment on issues related to the NTSB investigation. Spokesmen for Raytheon and SMART have repeatedly declined to comment.

The mechanic who adjusted the flight-control cables on the Beech 1900 turboprop was doing the job on that type of airplane for the first time, sources said. He expected an inspection by his supervisor, who -- like the mechanic -- was hired through SMART, a source said. Whether the inspection ever occurred is part of the investigation.

"(The mechanic) was told to do the job," the source said. "The inspector/supervisor told him some steps to follow and said he would watch him. But that guy was busy, inspecting and managing (and) trying to hold the operation together."

At bigger maintenance bases, including some third-party shops, there is typically more support for a mechanic, including inspectors, more supervisors and experienced co-workers.

"If I was working on something that was new for me, they always put me with someone who had done it before," said Joe Turner, a longtime US Airways mechanic who worked in Charlotte and retired in 1999.

At the least, the FAA should require that airlines retain the role of inspector when they contract out for maintenance, said Jim Burnett, chairman of the NTSB from 1982 to 1988.

"The FAA should say it's the responsibility of the airline, and not allow them to delegate that to anyone," Burnett said. "That's one thing that would prevent them from being a virtual airline."

The FAA visited the Huntington site several times before the crash, said spokesman Les Dorr. The site meets FAA standards, he said. Air Midwest is responsible for the work that goes on there because the repair station operates under its certificate, he said.

Typically, the FAA relies on the airlines to oversee employees at their maintenance shops, to make sure proper training is provided, adequate support is in place for employees doing a job for the first time and airline maintenance procedures are followed.

But the standards don't specifically address the situation at Huntington. Rules that were written to apply to airlines performing maintenance at their own maintenance bases, possibly with some mechanics provided by temporary agencies, are being applied at a hangar where the airline's presence is extremely limited.

"There's nothing in the rule book that deals with this growing situation of contract workers," said Bart Crotty, an aviation maintenance and safety consultant in Springfield, Va. "There's no regulation that speaks to that word `contract worker.' He's considered as part of the main organization, and the organization is (assumed) to know about their own employees."

Crotty said it's unusual for an airline to operate a maintenance base under its own certificate with the vast majority of workers provided by a contract agency, but there are no statistics that show how rare it is.

When the NTSB reviews the contractual arrangements in Huntington, it won't be the first time jobbing out emerged as an issue in a fatal airplane crash. The 1996 crash of a ValuJet plane in the Everglades, which killed 110 people, was blamed primarily on mechanics, supplied by a contractor, who improperly loaded oxygen canisters onto the plane. The canisters later exploded.

ValuJet came to be referred to as a "virtual airline" because it had jobbed out work traditionally done by airlines.

In response, the FAA developed a strategy for better managing virtual airlines by providing increased oversight of maintenance contractors.

Still, ValuJet sold tickets, loaded baggage at some airports, flew under its own name and used its own mechanics for line maintenance. Air Midwest, the operator of Flight 5481, filled none of those roles, partially because its contract with US Airways prevented it from selling tickets or loading bags. The relentless cost pressures of the airline industry have forced it and many other carriers to seek more efficient models for doing business.

At least four companies were responsible for operating, maintaining and loading Flight 5481. One was Air Midwest. Two other companies were involved in maintenance. A fourth company, US Airways, sold the tickets for the flight, which operated as US Airways Express. Piedmont Aviation, a US Airways sister company, loaded the plane.

Third-party maintenance companies now do about half of all maintenance work for U.S. airlines. In 2001, major carriers spent $2.9 billion for outsourced aircraft maintenance -- $1.3 billion more than they spent five years earlier, according to the U.S. Department of Transportation inspector general.

Located worldwide, these repair stations range from three-person shops that fix radios to stations with thousands of workers who rebuild entire airframes.

Contracting out can enable airlines to sidestep costly union contracts. Critics say mechanics at small third-party shops tend to have less training, less experience and less oversight from the FAA than mechanics employed directly by airlines.

Still, the U.S. aviation community continues to maintain one of the world's safest transportation systems. Crash rates have declined since the 1980s, along with the percentage of accidents related to maintenance problems. Modern commercial planes come with multiple safety backups, and are more reliable than ever. Airlines that farm out maintenance say they ensure the work is done to their high standards.

Whether the industry's financial crisis has affected the quality of maintenance is unclear. Two major airlines, United and US Airways, are operating under bankruptcy court protection while American, the largest airline, is considering a bankruptcy filing.

Industry officials insist they can't afford to skimp on safety. But some FAA inspectors and experts worry that financial pressures are eroding the safety cushion. They point to studies showing a correlation between the profitability and safety of airlines.

And some experts say it has become tougher for airlines to ensure maintenance work is done to their standards when the mechanics are contractually so far removed.

"The more removed you get from the maintenance, the more training it takes," says Sarah MacLeod, executive director of the Aeronautical Repair Station Association, a group that represents repair shops. "The more tiers, the closer you'd better be looking."

The DOT inspector general's office is now examining the FAA's oversight of third party repair stations. In testimony before Congress last month, DOT Inspector General Ken Mead warned that the FAA must pay attention to the shift in maintenance practices.

"In the current financially strapped aviation environment, FAA must remain vigilant in its oversight," he said. "A word of caution: FAA needs to pay close attention to the level of oversight it provides for repair stations."

Linda Goodrich, a maintenance inspector who now helps run a union that represents FAA inspectors, said third party relationships are still low on the agency's priority list. "If 10 percent of our time is devoted to these third party facilities, that would be saying something," she said.

-- STAFF WRITER ADAM BELL CONTRIBUTED TO THIS ARTICLE.

-- TED REED: 704-358-5170; [email protected]

 

[texflyer]

[blockquote]
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On 3/16/2003 830 AM KC tirechanger wrote:

Let's put it this way! Back when I hired on with TWA in the early sixtys, you could buy a brand new Chevy, or Ford,with all the bells and whistels for about $3,200! The price of gas was about $.32@Gal! I made about $3.20@HR! The price of a round trip ticket from L.A. to N.Y. was about $200.00! Today, the cost of that new Ford, or Chevy. is at least $25,000! The cost of gas to put in it? Let's not get into that one! Yes,I'm making a little more than I was then, but so is everyone! But guess what! The price of that round trip ticket, is the same, or less,if you shop arround!!!
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[/blockquote]


You just made my point,the fact that it was fare was $200 back in the 60s and is the same today,is a problem that cannot be changed. If an airline raised fares,the recreational public at large will find other ways of getting there(ie.low cost airline). We as consumers are much smarter now,and the airlines,and its employees are feeling the pinch in lower yields.

I hope the AA employees here keep making a descent living. There is no one else here who has the power to say,"you are making too much". I am just stating what you are up against in the market. The market wants cheap airfares,and so the corporations (Y fare customers). It is going to take another innovative Crandall like CEO to come along to give the market what it wants,and satisfy the labor groups.........Thats a job,not many are qualified for.

 

[NYPD]

[blockquote]
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On 3/15/2003 3:28:49 PM FrugalFlyer wrote:

[blockquote]
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On 3/15/2003 1025 AM KC tirechanger wrote:
texflyer, The question is: Why should the Employees of the Airline Industry be expected to subsidze the low fairs of the general public?
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[/blockquote]

How about this question: Why should customers be expected to subsidize the high wages of the employees of the airlines?
Or, if the question is too harsh then instead I ask: Why should customers be expected to subsidize the mistakes of airline management?

Its a 2 way street.

Right now airlines / employees are feeling they are being taken advantage of by their customers of all people, yet during the good years no airline employee (group of employees or managers) said anything about the customers being taken advantage of.

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[/blockquote]

Why? For safety's sake, that's why. Unfortunately, the odds will catch up with the flying public. Lives will be lost due to the underpaid, inexperienced flight crews and ground crews flying and maintaining our fleets of aircraft. The United States commercial aviation sector is lowering itself to the ranks of third world countries. You won't notice it until hundreds of people start getting killed by airplane crashes on a yearly basis.

And for what? So you can save an additional $49 on your RT ticket from DFW to LAX, and put a few extra dollars in the pockets of the airlines' CEO's pockets!

It is really sad, but not near as sad as we will be while going to funerals of our friends and family members.

Just my view of "The Big Picture".

 

[NYPD]

Airline crisis bedevils pension insurer
AMR bankruptcy would step up pressure on already limited funds

03/16/2003
By DANIELLE DiMARTINO / The Dallas Morning News

The shadow of a possible bankruptcy filing by AMR Corp. falls far beyond the employees and stockholders of the world's largest airline.
At the federally chartered agency that insures the pension benefits of 44 million retirees, officials are fretfully watching the airline industry and proposing rule changes aimed at stemming the tide of pension defaults.
Already dealing with a multibillion-dollar deficit, the Pension Benefit Guaranty Corp. fears a dominolike collapse of a large portion of the airline industry, as carriers seeking a level playing field follow each other into bankruptcy court and unload their burdensome pensions.
Experts outside the agency share those concerns. A similar rolling collapse across the steel industry contributed to an $11.4 billion loss for the agency last year.
That pool of red ink was five times larger than any in the 28-year history of the agency, which steps in to cover payment of pension benefits when a company goes bankrupt.
Even as the parent of American Airlines Inc. tries to slash costs and stay afloat, the prospect of the Fort Worth-based carrier heading to bankruptcy court looms larger as the industry downturn persists.
For both the airline industry and the pension agency, the question of airline pensions is huge.
Pension costs from bankrupt airlines could hammer the PBGC again, experts say. At the same time, the cost of supporting those pensions is a drag on the airlines as they try to stem their losses.
"The airlines have confirmed that pensions are their biggest problem – this will be the straw that breaks that camel's back," said analyst Christopher Struve of Fitch Ratings, which studies companies' financial health.
Two airlines are already under bankruptcy protection – US Airways Group Inc. and UAL Corp., parent of United Airlines.
A bankruptcy judge recently approved a plan for the PBGC to take over US Airways' pilots' pension, although the deal is not final.
UAL, meanwhile, has asked for another six months to come up with a bankruptcy reorganization plan that is expected to include the abandonment of its pension plan to the PBGC.
Last week, AMR started lining up loans and consultants that could help it through a bankruptcy. An AMR spokeswoman declined to comment on any speculation surrounding a bankruptcy filing.
According to Fitch Ratings, AMR's pension plan needs $3 billion more in assets to cover its obligations to present and future retirees – a shortfall known as underfunding. US Airways' pension is underfunded by $3 billion, and United's by $4.1 billion.
Overall, the airline industry's pensions have $28 billion in assets to cover $46 billion in obligations, placing the funding level at about 60 percent, Fitch says.
"Historically, having your plan fall below 60 percent funded means your fund is going to be assumed by the PBGC," Fitch's Mr. Struve said.
The airline industry's pension plans have gone from a $1 billion surplus in 1999 to $20 billion in underfunding in 2002, Fitch estimates. If the PBGC had to swallow that entire $20 billion in underfunding today, it would nearly eliminate the agency's $25 billion in assets.
In testimony to the Senate Finance Committee on Tuesday, the PBGC's executive director urged that steps be taken now to strengthen the agency's position. One solution he offered was toughening rules governing the funding levels that companies must maintain in their pensions.
"The current $3.6 billion deficit, even though it is the largest in history, does not create an immediate liquidity problem for PBGC – we will be able to continue paying benefits for a number of years," executive director Steven A. Kandarian said. "But with $29 billion in benefit liabilities and only $25 billion in assets, we should not wait to put the insurance program on a sound financial basis."
Shortfalls
Pension shortfalls have been a major problem for corporate America over the last year. Investment losses have hurt many companies' bottom lines and forced some to shore up their pensions with cash.
The PBGC estimates that the total underfunding in defined- benefit plans now exceeds $300 billion, the largest number ever recorded. Merrill Lynch estimates that earnings of companies in the Standard & Poor's 500-stock index will be reduced by 10 percent in 2003 because of pension losses.
For many airlines – facing a tough economy, heavy competition and threats of terrorism – pension troubles may be insurmountable.
"We believe it is highly probable that the PBGC also will assume United's pension," Mr. Struve said.
Mr. Struve worries that if United and US Airways succeed in having the PBGC assume their pension liabilities, all of the other major airlines may follow suit to survive.
"These guys are facing monstrous cash calls for the next few years at the worst possible time," Mr. Struve added. "It's pretty hard to envision a world where the other guys retain their pensions."
Delta Air Lines Inc.'s funding gap is the largest, at $4.4 billion, while Continental Airlines Inc. and Northwest Airlines Corp. are burdened with gaps of greater than $3 billion, according to Fitch.
Barring a bankruptcy filing, those gaps must be filled one of two ways – by the airlines injecting some of their scarce cash into the pension plans or by the stock market making a quick turnaround and boosting the plans' returns.
Dallas-based Southwest Airlines Co., the one profitable carrier in a troubled industry, doesn't have a pension plan.
Philip Baggaley, airline credit analyst with Standard & Poor's, said he sees a worst-case scenario in which all but one of the biggest airlines land in bankruptcy court. Under that scenario, the surviving airline would be operating at a serious cost disadvantage.
"If there is an airline which is strong enough to avoid bankruptcy, they would certainly try to negotiate changes to lower their pension costs," Mr. Baggaley said. "But those changes could not be as extensive as the reductions from terminating plans in bankruptcy."
Mr. Baggaley retains some hope that a quick end to a war and even quicker resolution with its unions could save AMR from having to file. But he concedes that there are a lot of ifs in that scenario.
Company-funded firm
Formed in 1974 alongside the Employee Retirement Income Security Act, or ERISA, the PBGC is funded by pension insurance premiums paid by corporations to the tune of $800 million a year. In return, the agency insures the firms' $1.5 trillion in pension benefits.
Those premiums, coupled with the returns of the PBGC's own investments throughout the bull market, helped the agency operate with a surplus beginning in 1996. It was not until 2002, which saw five of history's 10 biggest bankruptcies, that it lost its surplus cushion.
In 2002, the PBGC took over 144 pension plans, a 40 percent increase over 2001, covering 187,000 people. The agency paid $1.5 billion in benefits last year. It expects to pay $2.5 billion to nearly 1 million retirees in 2003.
In his Senate testimony, Mr. Kandarian noted that the pension obligations the agency took over in 2002 were greater than the total for all previous years combined. In addition to the steelmakers, retailers including Grand Union and Bradlees and manufacturers such as Polaroid and Singer also landed on the PBGC's doorstep last year.
The biggest case in 2002 – and in the agency's history – was Bethlehem Steel. The agency booked as a "probable" loss the $3.9 billion it will swallow when it takes in the company's pension fund this year.
Bethlehem's proposed $1.5 billion acquisition by International Steel Group wouldn't have gone through if International Steel had had to assume Bethlehem's $11 billion in debt, much of which was associated with its pension liabilities. Bethlehem had $3.5 billion in assets remaining in its pension to cover a $7.8 billion obligation.
Bethlehem was one of three major steel companies to fold last year, largely due to massive legacy liabilities owed to retirees, who greatly outnumber current employees.
Murky outlook
Mr. Kandarian worries about a continued collapse of the steel and airline industries. He told senators that over the long term, the agency's deficit "may increase dramatically."
"In our most recent annual report, PBGC reported exposure to additional claims totaling $35 billion, which we classify as 'reasonably possible,' " Mr. Kandarian said. "Of this $35 billion, about half represents underfunding in airline and steel plans."
Experts agree that the PBGC's troubles would abate if the "perfect storm" that created the current deficit would reverse course: the stock market demise that has stripped assets from pensions, falling interest rates that have sent pension obligations skyrocketing and an economy that has crippled businesses.
The rash of U.S. corporate bankruptcies is expected to continue this year, although at a slower rate than in 2002, according to a recent PricewaterhouseCoopers report. It stated that about 180 publicly traded companies will file for Chapter 11 in 2003, compared with 189 filings in 2002 and 257 in 2001.
One solution Mr. Kandarian proposed would require companies' pensions keep a higher level of assets relative to obligations.
He also called for requiring companies to report more frequently on the health of their plans.
Another option would be to increase the insurance premiums that companies must pay, but Mr. Kandarian said that might discourage companies from offering pension plans to employees.
"Raising premiums enough to cover losses of the size the PBGC endured in 2002 could prove counterproductive, driving the financially healthy companies out of the defined-benefit system," Mr. Kandarian testified.
Disturbing similarities
Several experts have drawn parallels between the PBGC's situation and the savings and loan crisis of the 1980s, in which taxpayers had to cover depositors' losses when the industry collapsed.
Like the Federal Savings and Loan Insurance Corp., the PBGC is a quasi-government agency that guarantees a private liability – the FSLIC insures deposits and the PBGC insures pension benefits.
In 1996, Dr. Zvi Bodie of Boston University, an authority on pensions, wrote a paper in which he predicted heavy deficits at the PBGC if the economy, the stock market and interest rates all suffered protracted declines at the same time. Such a confluence of events, he said, could land taxpayers in a predicament in which a bailout might be the only option.
"History never repeats itself in the same way," Dr. Bodie said. "I never predicted the stock market and interest rates would fall at the same time. I merely said it was possible, and sure enough, it happened."
In October, he presented the PBGC with some solutions. They included requiring firms to pay higher premiums to the PBGC, depending on how aggressively they invest their pension plans' assets.
In his paper, he recalled a statement in the PBGC's 1992 annual report by former Secretary of Labor Lynn Martin: "One would have to be an ostrich with its head buried in the sand to ignore the warnings and not learn from the analogy of the savings and loan crisis."
Even before any sort of parallel crisis unfolds, lawmakers appear to be directing their attention to the PBGC's situation.
Although a spokeswoman for the Senate Finance Committee said no more hearings are planned for now, the House Education and the Workforce Committee has said it may schedule hearings on the agency's health in the spring.
"They still have reserves to more than pay out their benefits for quite a few years," said Kevin Smith, spokesman for the committee. "That doesn't constitute any sort of crisis. Now, if this continues to happen for several years, that might change."
Staff writer Todd J. Gillman contributed to this report.
E-mail [email protected]

 

[NYPD]

Read this Pittsburgh Post-Gazette February 26th, 2003 article about the USAirways CEO pension payouts a week before bankruptcy, and then read the Dallas Morning News article from today's paper (March 16th) regarding the employee contract pensions. This is a true "reality check"!!!!!!!!!!


US Airways gave $35 million in pension payments to top 3 former executives

Wednesday, February 26, 2003
By Frank Reeves, Post-Gazette Staff Writer


As it was careening into financial ruin and ultimately Chapter 11 bankruptcy, US Airways paid $35 million in lump-sum retirement benefits to its former top three executives.

Stephen Wolf, who ran the airline for seven years and now serves as chairman of the board, received $15 million. Wolf is no longer employed by the carrier. His protege, Rakesh Gangwal, who resigned as president and CEO in November 2001, also received $15 million, and Lawrence Nagin, the airline's longtime executive vice president and general counsel who retired last March, received $5 million.

Although the payouts apparently took place at the time each of the executives retired, they didn't come to light until this week during a bankruptcy court hearing in Alexandria, Va. Disclosure of the payments was tucked into documents filed with the court last September and October.

During the first half of their tenure, Wolf and Gangwal were praised for their role in turning around an airline that in the mid-1990s teetered on the brink of bankruptcy. But their reputations faded as their growth strategy became undone by a recession that hit all carriers and sharp drop-off in air travel after the Sept. 11 terrorist attacks.

The three men were entitled to receive the retirement benefits as part of the employment contracts they negotiated with US Airways' board of directors. But the payouts drew immediate fire from airline employees suffering from lost jobs, benefits and pay cuts and from some outside analysts.

The payments are yet another example of "outsized compensation to management that borders on looting," said William Lauer, chairman of the Tarentum-based Allegheny Capital Management, a former investor in the airline.

The issue of the retirement benefits was raised this week during a hearing before U.S. Bankruptcy Judge Stephen Mitchell on the airline's request to terminate the pension plan for its unionized pilots and replace it with another plan.

The airline has contended that unless it can reduce its pension expenses -- what it must pay over the next seven years to cover its unfunded pension liabilities -- it won't be able to obtain the federal loan guarantee and equity funding it needs to survive. The airline hopes by scrapping the current plan and replacing it with another, it can significantly cut its expenses.

While being cross-examined by the unionized pilots' attorney, US Airways' Chief Financial Officer Neil Cohen testified that Wolf, Gangwal and Nagin received their million in lump-sum retirement payments.

The Air Line Pilots Association's spokesman, Roy Freundlich, said the testimony, which the union immediately posted on its Web site, confirmed what many pilots suspected: that the airline's top executives were protecting their pensions while sacrificing those of other employees.

The disclosure of the retirement payouts came in a time that has seen the airline's ranks slashed by more than 16,000 and management wrest more than $1 billion in annual wage and benefit concessions from its unionized workers.

The pilots, which as a group have agreed to $565 million in annual concessions, contend that if their pension plan is abolished and taken over by the federal Pension Benefit Guaranty Corp., they could lose as much as 65 percent of their benefits.

This isn't the first time that Wolf and Gangwal have been criticized for their salary and benefits.

In August 2001, when the deal to merge with United Airlines fell through, Wolf, Gangwal and Nagin agreed to forgo their contractual rights to resign that fall -- a move that would have made them eligible for severance packages totaling a combined $45 million. The three made the move amid protests from workers.

In the next month, Wolf and Gangwal came under fire again from labor unions for retaining their full salaries at a time the airline was slashing its work force and seeking concessions from its employees following the 9/11 attacks. The pair later agreed to give up their salaries and benefits for the last 15 weeks of 2001, moves that cost them nearly $200,000 apiece.

In 2000, Wolf's compensation from all sources totaled $11.6 million, including $7.6 million in reimbursement for taxes paid on restricted stock received over the years. Gangwal earned $12.1 million in total compensation, including a $7.2 million reimbursement for tax liabilities.

 

[KC tirechanger]

Texfler, No, you've missed my point competly!! What the Airline Industry needs today is "RE-REGULATION"!!!To keep, and get, the caliper of people needed to fly, and maintain the number of Aircraft required to meet the general publics travel requirements! "SAFELY"!!! If this trend continues, these skilled people won't be there!It's that simple!!!!