/ From the Senior Vice President
July 18, 2008
As you all know, United has had to take necessary and decisive action to mitigate the unprecedented cost of fuel and the effects of the current softening economy. We are not alone. Carriers throughout the industry are facing the same challenges. As part of our action plan, United announced in June that it must take the difficult but necessary step of reducing our workforce by as many as 1400 – 1600 salaried and management (SAM) employees.
For United Services, we’ve determined that we will have to reduce our SAM employees by 250 - 350, through voluntary furloughs, attrition, retirements and, unfortunately, involuntary furloughs. Yesterday, many of our employees were notified by their managers that they would be directly affected by the SAM reductions. While yesterday was their last day, they were given the option to make arrangements to return and finish tying up loose ends, so we ask that everyone in the division demonstrate compassion and respect for all your colleagues as we transition our work during this difficult time. We also want to acknowledge those individuals who have been affected by our reduction in force. Their efforts and contributions are much appreciated and we wish every one of them success in the future.
This was the first round of job reductions. As a result of our previously announced fleet reductions and capacity pull downs, we have had to make the difficult decision that in addition to the reduction of SAM employees, there will be a reduction in force that affects union-represented employees. Though we do not yet have the total number or specific locations of the reductions, we are continuing to have discussions with Teamsters leadership about how we may be able to mitigate some of the impact of involuntary furloughs.
As a result of the capacity, schedule and workforce reductions, there have been several changes to our division organizational structure and reporting relationships. Cooperating and collaborating throughout this process, the leadership team has thoughtfully worked to re-align the organization to maximize efficiencies and synergies, remove potential redundancies and still maintain proper support to employees across the division and on the frontline.
Notably, we have agreed that to best leverage the expertise of our Continuous Improvement team, we will deploy the majority of team members in the operation to work on strategic projects that will yield a quick and meaningful return. As a result, we will eliminate the position of Managing Director – Continuous Improvement. Additionally, we will eliminate the position of Managing Director – Components and split that group between Airframe and Engines. Finally, we have streamlined the Engineering group by eliminating the position of Managing Director – Engineering. Tracy and Rick will shortly communicate more details about these and other changes within their respective organizations to be followed up with revised organization charts on the front page of the United Services page on SkyNet.
At United Services, we continue to explore every avenue to maintain our workforce, while we strive to create a sustainable and competitive MRO business that delivers 100% quality, 100% on-time and on cost. Through our commitment to continuously improving engine cycle time, cabin appearance and workability, the efficiency of our line maintenance network and our supply chain management, we can - and will - not only survive, but thrive.
I understand this is not an easy time for any of us and I’m aware that the next few months will continue to be challenging. I ask, however, that you remain committed to the success that you’ve helped build through many years of hard work. Together we can build a competitive company that can withstand these unprecedented challenges in the industry and operate successfully for our customers, our investors, and our employees.
Joe Kolshak
July 18, 2008
As you all know, United has had to take necessary and decisive action to mitigate the unprecedented cost of fuel and the effects of the current softening economy. We are not alone. Carriers throughout the industry are facing the same challenges. As part of our action plan, United announced in June that it must take the difficult but necessary step of reducing our workforce by as many as 1400 – 1600 salaried and management (SAM) employees.
For United Services, we’ve determined that we will have to reduce our SAM employees by 250 - 350, through voluntary furloughs, attrition, retirements and, unfortunately, involuntary furloughs. Yesterday, many of our employees were notified by their managers that they would be directly affected by the SAM reductions. While yesterday was their last day, they were given the option to make arrangements to return and finish tying up loose ends, so we ask that everyone in the division demonstrate compassion and respect for all your colleagues as we transition our work during this difficult time. We also want to acknowledge those individuals who have been affected by our reduction in force. Their efforts and contributions are much appreciated and we wish every one of them success in the future.
This was the first round of job reductions. As a result of our previously announced fleet reductions and capacity pull downs, we have had to make the difficult decision that in addition to the reduction of SAM employees, there will be a reduction in force that affects union-represented employees. Though we do not yet have the total number or specific locations of the reductions, we are continuing to have discussions with Teamsters leadership about how we may be able to mitigate some of the impact of involuntary furloughs.
As a result of the capacity, schedule and workforce reductions, there have been several changes to our division organizational structure and reporting relationships. Cooperating and collaborating throughout this process, the leadership team has thoughtfully worked to re-align the organization to maximize efficiencies and synergies, remove potential redundancies and still maintain proper support to employees across the division and on the frontline.
Notably, we have agreed that to best leverage the expertise of our Continuous Improvement team, we will deploy the majority of team members in the operation to work on strategic projects that will yield a quick and meaningful return. As a result, we will eliminate the position of Managing Director – Continuous Improvement. Additionally, we will eliminate the position of Managing Director – Components and split that group between Airframe and Engines. Finally, we have streamlined the Engineering group by eliminating the position of Managing Director – Engineering. Tracy and Rick will shortly communicate more details about these and other changes within their respective organizations to be followed up with revised organization charts on the front page of the United Services page on SkyNet.
At United Services, we continue to explore every avenue to maintain our workforce, while we strive to create a sustainable and competitive MRO business that delivers 100% quality, 100% on-time and on cost. Through our commitment to continuously improving engine cycle time, cabin appearance and workability, the efficiency of our line maintenance network and our supply chain management, we can - and will - not only survive, but thrive.
I understand this is not an easy time for any of us and I’m aware that the next few months will continue to be challenging. I ask, however, that you remain committed to the success that you’ve helped build through many years of hard work. Together we can build a competitive company that can withstand these unprecedented challenges in the industry and operate successfully for our customers, our investors, and our employees.
Joe Kolshak
