OK so now you spell out what you want and more about the problem.
DO YOU HAVE A SOLUTION TO THIS PROBLEM?
Think about this question real hard.
What do we have to gain by pulling out of the JLT, PLI crap?
Working with the company is NOT the problem here pal, the problem is that we are NOT being rewarded for that effort. I could really care less what management gets as long as I am being rewarded also. Pulling out serves no purpose at this point in time.
The problem, has been the same for 20 plus years of my employment at AA.
But what is the solution? Can you stop bitching long enough to comment on this proposal?
Well I would agree that the TWU gave AA a cost advantage for twenty years but I disagree that BK changed that and gave the advantage to other carriers.
Outsourcing OH does not eliminate OH costs, it may at best reduce costs, it may also increase costs by shifting them to higher costst on the line and lost revenue.
In the case of other carriers who did not have the TWU SRP/OSM program the only way to compete with AA was to outsource OH because in order to match AAs costs they would have had to have workers accept neraly 50% paycuts.
At best BK gave those carriers an equal footing with AA.
As long as AA keeps OH they have the means to maintain a competitive edge. If they outsourced all OH the MRO would set the cost, and that cost would be pretty much what everybody else pays. If AA outsourced all its OH they would lose this means to a competitive edge.
From what I’ve read MROs are not earning what would be expected with such an increase in demand. MRO prices are likely to increase especially as foreign aviation continues to grow. Labor costs are one of the few areas where the airlines have a lot of control, outsourcing eliminates that, now the MROs set the price.
My guess is that we will see consolidation in the MRO business. With consolidation costs for customers will increase.
By keeping OH and offering contract services to other carriers AA will maintain a cost advantage, because unlike their competitors who pay other companies for maintenance, at a rate that provides profits for those MRO companies, AA will have their maintenance done at cost and have their costs further offset by revenue from contract work.
As far as the contract proposals I would say that we are worlds apart.
Contract Proposal
1. Offer Early Out option to retire the large number of aged folks on the defined pension plan. A (3 and 3) 3 years age, 3 years seniority would probably dump the mother load into retirement quickly.
Why? Let the company offer that, don’t ask for current and future members to pay for something that saves the company money.
2. Offer an increase in pension benefit formula to the TWA mechanic so that they can afford to leave.
Once again, why ask for something that saves the company money?
3. Close MCI and offer full seniority to those few that will choose not to retire after #2 is implemented. Sell this overhaul base.
Again, let management come up with things like that. If the company proposes shutting the base say OK if they give them #1, #2 and systemwide occ sen.
4. Offer wage and benefit increase to the unretired mechanics possibly including stock options since the company doesnt seem to count those as cash offerings, we could gain substantially by this method.
Ok.
5. Offer Line Premium pay that will be worthwhile and offset high cost of living areas.
OK, but determining where its in effect should be in the contract and not at the company’s discretion like Flex Starting rates.
6. To fund cost of the above, create a new classification whereby new hires are no longer offered the defined pension but rather a 401(k) matching fund. And once again lenghten the time to top-scale pay. Through attrition, allow those that already have the defined pension to retire with that plan. Eventually the defined plan will no longer have a liability. But remove the defined plan from no employee.
Another Company proposal.Besides we already pre-funded everything with the 25% we gave from 2003 to 2008.
7. Offer a length of agreement that will allow AA to purchase and replace the MD-80 Fleet. As retired personell are replaced, the CASM will average down. The faster you hire workers the faster your average CASM will drop. Lower CASM equals higher yield.
In other words repeat all the mistakes of the past.
All in all I would say that this list sounds like a company wish list rather than a union list. In other words it sounds like a typical TWU contract.
Here is my list.
Full restoration of all pre-2003 workrules and benefits.
Restore pay to pre-2003 concession plus catch-up Cola and maintain COLA plus 1.5% annually for term of contract.
If the company wants the 401K for new hires they must provide 6% match for new hires a 4% match for those with defined pension and a 5&5 for current employees.
Eliminate all progressions. Top rate is the only rate for each classification. Hiring at top rate would allow the company to draw talent away from competitors.
Longevity pay increased by factor of 10 from pre-2003 formula.
Line Premium of 20%
Weekend Premium of 15%
Aft shift premium of 10%
Night shift Premium of 20%
I don’t think that it’s the unions place to tell the company to eliminate benefits, close bases and lower lifetime earnings for members by extending progressions. Nor do I think its our place to run the company, keep it simple , "we need this and are willing to burn the place down in order to get it". Once management realizes they cant scare the workers with threats they will negotiate. Dont ever go to the table with the attitude that the union is responsible for the management of the company.