US Airways Responds to CWA Rep.''s Misinformation

[BuccaneerBill]

MrAeroMan...
I sincerely apolodize if I offended you in any way. I realize now, that my remarks to Chip went out to a lot of people.
As a pilot, myself, I do respect pilots....especially you guys that fly the big birds. I know you have a lot of responsibility and I didn*t mean to sound disrespectful to all pilots. I apologize.
I do appreciate your well-intended advice. I do think, however, that we cannot ignore that class level is an issue here. It*s a matter of pay, benefits, and retirement and the level varies depending where you are at in the ranks. It shouldn*t be that way but, that is a fact of life. That*s why we have Republicans and Democrats.
The feeling of frustration at my level comes from our unilateral giving in the 90*s and the fact that we just did step to the plate and voted by 75% to help again. We did not have 17% and 16% raises built into any of our contracts. We don*t have a defined pension plan, anymore. We at this level have to ask why do we have to give up completely, some benefits while those that make much more than us don*t?
My intention is not to cause USAIRWAYS to liquidate. I got into this job because it*s what I did to fund my flight training when I came out of school. When health reasons kept me from moving up, I continued this job because I liked airplanes, airports, and yes, pilots. I just never had the luck that others had. Not bitter, just tryin to make a living now.
So, I still, must hold the opinion that the company has not been equitable with us. However, I do want to apologize to the many pilots out there that I offended with my remarks to Chip. As a private pilot, I do respect you guys that fly the big stuff. It*s just that, once-in-a-while, it*s not pleasant when someone above you in stature (and someone you respect), shows you very little.
Good luck to you, ITRADE, and all at USAIRWAYS.

My apologies,
BuccaneerBill

 

[luv2fly]

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On 1/6/2003 8:03:59 AM ITRADE wrote:

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What's illegal is illegal - just like the mechanic who threw the chocks into the 737.[/P]
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And I suppose the willfull disregard of a written contract is legal and ethical as well? If you are going to point fingers trade, then point them fairly.

 

[magsau]

Mr. Chiames,

I agree with Andy S., while I am not an AA employee the spin machine at AA is one of the best and when the truth is blurred by deceit then you cannot be expected to believed when you start talking to the U group. A person can not just walk out of one job and expect a clean slate to start from with a history such as yours.

Frank Lorenzo could not start a new airline and have everyone believe he would be the pillar of employee relations. As such your past will haunt you until you prove otherwise. Hopefully, it will be in quickly and you can prove to the U employees you are not still lying as you have in the past.

 

[tadjr]

Just wanted to add my .02 to the thanks for taking the time to come here and answer questions. I appreciate someone from CCY taking the time to keep us informed. While I might not agree with certain things being posted (from both sides of the fence), I do appreciate the dialog.

 

[flyonthewall]

A senior executive from your company takes the time out of his schedule to answer a few questions on this forum...but a few employees want to question his past history with another airline.....why not take this opportunity to develop some quality questions that affect you on a daily basis. Lets not waste this valuable time discussing AA and what happen in the past. Spend this time and lets re-build this airline. Chris Chiames have opened the forum for questions....lets see if the employees can meet the challenge.

Don't complain in the future that you didn't have this opportunity when you feel that nobody is listening to your concerns. I would like to thank Chris Chiames for taking the time to participate on this board. How many other senior executives are taking the time to listen and respond to the front line employees?

Some employees always bring up Wolf and Gangwal and the mistakes by our previous management. Guess what! They aren't operating this airline and lets give the current management team a chance to prove their abilities to turn this airline around.

Dave and his team have been in CRISIS management since their arrival last year. To the "no" voters, if you truly love your airline, give this people a chance to get us out of Chapter 11--right now--they are our only hope.

 

[US Airways]

Andy S., if you or anyone else think that I, or for that matter, any others in management are the issue or should be the subject of this discussion, they are kidding themselves and denying the realities of the industry and the challenges we face. Terrorist attacks. Rapid escalation in fuel prices. Overcapacity in the industry. The explosive growth of low-cost airlines. A prolonged recession and historically low demand and fares. Skyrocketing health care costs. The threat of war...

We are trying to share information and address the facts. It appears that Andy S. is still hoping to justify an illegal job action by APA. Spare us please.

I know that a couple of other specific questions have been raised. I am working off a Blackberry as I am out of the office for a bit, but will go online and try to address any outstanding items asap. Thanks.

Chris Chiames

 

[magsau]

Chris Chiames wrote:"The explosive growth of low-cost airlines."

Chris,

Sorry but I can not agree with you that the low cost carriers are the reason behind the problems in the industry. Sure they have siphoned some pax but I thought the majors had some great revenue machines that offered a few seats at the "teaser" price match of the low-cost carriers and kept many of the other seats at higher fares. In the meantime an airline like AA or UAL that offers worldwide service can not and will never be able to emulate the CSM of a LUV or JBLU by virtue of the cities served and fleets required to fly to these worldwide destinations. Perhaps U could come close to emulating the LUV cost with the restructered airline going to a single fleet type A319/20/21 configuration but not sure with the high cost associatied with LGA, BOS, DCA etc. When LUV and JBLU start flying to the high cost destination airports then we can start talking straight comparison.

I agree the cost structure need to be revamped at the network carriers I just do not see the CSM matching LUV or JBLU in the near or long term no matter how much you want to cut employee salaries and benefits. At some point management needs to get the yields to a level that produces revenue.

As a UAL employee I see our airline operating more on time, with higher load factors than in the history of the company and yet we still bleed. The choke point at UAL has alot to do with the RJ's that managment loves. We have pulled down 737's from the outstations and cannot get the feed to the hubs to fill the widebodies. For example, a city that once had 3, 737's and approx 360 seats to offer is now being served by 3, 50 pax rj's and 150 seats. These flights leave full but UAL loses money becuase it cost us 16cents per ASM to fly these inefficient airplanes to the hub. Put a 737 in the markets with the "new" cost structure we are negotiating and maybe we could turn a profit. Unofortunately, UAL and you at U are intent on reducing the number of mainline employees to the point of killing the airline to do so.

The only thing the employees want from the managers is integrity and the presentation of a business plan that would provide a future and hope. For you see Mr. Chiames, we are stuck in a seniority system and cannot leave on carrier for another like yourself and get a payraise. We are married to our airlines and we are here for the duration. Where will you be in 10 years? CO, DL, NW? The amount of recylced "talent" in this industry is sad.

 

[BillLumbergh]

Let's ensure that cool heads prevail here.[BR][BR]Enough of the personal remarks; enough of the flames.

 

[DCAflyer]

Chris,

In an attempt to segue this discussion into something more productive than the personal attacks being spewn your way (unjustified and uncalled for, in my book, by the way), a while back many of the correspondents on this board offered several pages of suggestions to the company (some good, some not so, and some just the usual rants of the chronic complainers!) We were told that someone from management is going to review those suggestions. We haven't heard anything back on whether management thought some of them useful and will implement any of them. Is it possible for you to post a summary of what, if any, of those suggestions management might utilize?

DCAflyer

 

[mlt]

Mr. Chiames,[BR][BR]A. You stated in a post last night that severance pay will be honored according to the contracts. Please list the labor groups who maintain severance pay.[BR][BR]B. Please define the term "labor friendly"[BR][BR]C. Please explain the above "labor friendly" in conjunction with hiring Jerry Glass, a man who posts (in reference to unions) on his website "When they roar, we pounce." A man who posts he will "educate the workforce against unionization and will investigate their financial statements".[BR][BR]D. Please explain David Castleveter's statement to Pittsburgh news channels that US Airways never told the CWA they would liquidate if they did not take the agreement to their membership?[BR][BR]E. Please explain the logic of creating 4 new Inflight Director positions within one month of our summer restructuring agreement considering we have 4,000 less f/a positions to manage.[BR][BR]Thank you,

 

[mlt]

Do It For Dave,[BR]Nice Try! [BR]A.Inflight created [STRONG]4 director positions.[/STRONG] [BR][BR]B.Regarding the Pittsburgh news channels, please contact them..David Castelveter was quoted as saying liquidation was never mentioned to the CWA. [BR][BR]C.There is conflicting posts regarding the elimination of severance pay in the event of war. Why not have corporate communications come out and state the facts to all concerned before the votes are cast?[BR][BR]D. If Mr. Chiames is the corporate spokesperson he should be able to explain 'treating the employees with respect' and hiring a man who states 'when they roar, we pounce'.[BR][BR]As Mr. Chiames offered to answer questions, I think I will wait for the corporate word. That is, unless you would like to reveal yourself!

 

[Do_it_for_Dave]

mlt, I assume that you are an employee, check with your local union regarding possible severance pay. I believe all of the unions offer some type of severance package. You union will have the latest contract on their website or you can obtain a copy from a steward.

Regarding your question concerning labor friendly. This question has been answered on numerous occasions,especially at the road shows. You can log onto "thehub" and watch the video where Dave explains the term labor friendly and his approach to the employees. Here is a quote from his Q&A that was conducted on this website last year. "So my philosophy starts with the premise that our people are assets. And it is followed by my belief that everyone should be treated with respect and dignity. We are not always going to agree, we can be respectful of each other’s points of view." Hope this helps to clarify the labor friendly definition for you.

I would like to address a comment that was made by Magasau “The amount of recycled "talent" in this industry is sad.â€￾

As Dave Siegel pointed out in the Q&A session, the management structure is different than the seniority system. Here is his direct quote: "In the management ranks, people are not protected by seniority. The fact is that recruiters are circling US Airways like vultures because they know we are in trouble, figuring that there are plenty of talented people who will entertain offers to go to a more secure employer or more lucrative opportunity. And for positions like lawyers, financial analysts, marketing staff, and the like, they can take their job skills and transport them to any other industry. So we have a huge challenge to keep people in their jobs so that we can successfully restructure the company and execute the new business plan. In the first half of 2002, our director-level and above resignations have increased more than 300 percent over the first half of 2001. To fill a Director-level position in Finance, Marketing, or Scheduling, for example, costs the company in excess of $60,000 in recruitment, relocation and other expenses – above and beyond a competitive salary. In fact, we now have to pay well above market salaries just to hire someone."

"Ultimately, this retention program will cost less than the recruitment, lost productivity, loss of experience, and related costs associated with losing key managers and then replacing them. Now I have had some employees say that if management employees don’t want to stick with the company through this crisis, then we should let them go. But we can’t afford to allow that to happen. This has nothing to do with their loyalty – but it has everything to do with our needing the best people in the job."

Why is it negative that a management employee desires to leave a company for an increase in salary or improve job description? I think that all seniority employees would take advantage of this benefit if you were allowed to maintain your seniority with another airline.

Chris Chiames didn't hire Jerry Glass and he shouldn't have to answer this question. Dave hired his executive team and not Chris Chiames. So, that question doesn't relate to him. Why not ask Dave?

David Bronner was the one who made the public comments regarding seeking further concessions ($200 million) or there could be a possible liquidation. Remember- Bronner is the Bank and controls the DIP financing. If you are a CWA president who participated in the negotiations, please identify yourself, as a few other union officials have on this message board. Unless you are directly involved in the confidential negotiations, you really don't know what was said or wasn't.

mlt, I assume that you are referring to "inflight supervisor" positions and not an actual director level position.

Regarding the low cost carriers (LLC)...The profitability of the airlines began to deteriorate in the late 90’s and with the events of 9/11; the low cost carriers had a solid platform to expand their product. The carriers had a difficult decision on reducing their capacity—how much is too much - how much is too little?

The Low fare carriers out carried the major network carriers at the cities that they serve in common. For example: US- approximately 45,000,000 annual passengers versus 65,000,000 for the LLC.

The LLC continue to penetrate the major US markets and seize passengers from the major carriers. Here is a quote from Dave Siegel in his employee memo dated 11/26/02

“Low-cost competitors and the Internet are here to stay. We cannot hope for the return of $2,000 transcon fares. Pricing pressure on the mature airlines will only grow worse as low-cost carriers continue to expand and both business and leisure travelers shop the Internet with price in mind.â€￾


to dcaflyer....Dave also stated the following in the same newsletter to the employees...“I have received numerous cost-cutting suggestions from employees, and we are completing a top-to-bottom business review to eliminate waste and abuse.â€￾

 

[flyonthewall]

http://www.iacwashington.org/siegel091702.pdf

Step #3: Define the Terms for “Labor-Friendly†Recovery.

I’ve repeatedly shared with my US Airways colleagues a lesson taught to me by Gordon Bethune: Don’t fight with your spouse, and don’t fight with your employees. From Day One, I have expressed my desire to implement a labor-friendly restructuring, where labor was a partner with management, and we work constructively to achieve mutually beneficial results.

If I polled this audience, I imagine I would get multiple – probably even contradictory definitions of “labor friendly.†I know there were multiple opinions within the US Airways family when we started this process. Therefore, it was vital that just as we needed to lay out a vision of where we were trying to take the company, it was also critical that we defined just what “labor friendly†meant within the context of trying to save a company operating in a rather desperate environment.

“Labor friendly†does not mean labor sets the agenda, or management gives employees everything they want in order to achieve labor peace. Frankly, labor peace achieved through acquiescence is a cop-out. Responsible management must develop the plan, articulate the vision, communicate the goals, debate the merits, and hopefully convince the stakeholders – including employees. It may not be easy or fun. But if successful, it will be meaningful.

But “labor friendly†does mean a number of other things that are important to labor – and thus, to the overall success of the company. So we defined a labor friendly restructuring as one that involved: Insuring the company’s immediate survival

• Providing for long-term success

• Saving as many jobs as possible

• Preserving as much pension and benefit compensation as possible, in combination with com-petitive wages

To this last point, we took this point of view: Wage cuts are painful, and giving up benefits is hard. But given the economy and the state of the industry, most employees were still going to be better off keeping their current US Airways job with a pay cut, than the alternative.

So we never started any conversation with the goal of “How are we going to save all the existing jobs at US Airways?â€

That wasn’t the choice. The choice was between 35,000 jobs and no jobs. And we said emphatically that we would rather choose 35,000. To their credit, union leaders also made that difficult but smart choice. So while our recovery is going to involve furloughs and job reductions, it is clearly designed to provide for the long-term success of the company. In my book, that is “labor friendly.â€

Being labor friendly also means trying to insure employees’ retirement income.

Think about this. If we had not found a solution to reduce our labor costs prior to filing for Chapter 11 protection, there was a real possibility that the Pension Benefit Guaranty Corporation might have seized and terminated our pension plans.

For a pilot age 50, for example, with spouse and dependents, he or she could have seen their benefit drop from about $160,000 per year to $23,000 per year. Furthermore, post restructuring, our employees will own approximately 30 percent of the new company, and more than half of US Airways’ cash flow over the next 7 years will go toward funding employee pensions.

Solving that problem with our unions is what I call labor friendly.

 

[mlt]

Fly on the Wall & Do it for Dave,[BR]The first restructuring agreement I voted yes, I was willing to give you a chance to prove you were different from previous management. The second restructuring agreement came around and my immediate response was no. During the last week I have rehashed the issue ad nauseum. I gave you an opportunity to answer my questions and all you offered was spin. [STRONG]Therefore, my vote is no.[/STRONG] Am I casting a vote for the unemployment line? probably. But more importantly, you will always be known as the team that couldn't get it done.[BR][BR]Cheers,

 

[Andy S.]

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On 1/6/2003 1:25:48 PM US Airways, Inc wrote:

We are trying to share information and address the facts. It appears that Andy S. is still hoping to justify an illegal job action by APA. Spare us please.

Chris Chiames

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Mr. Chiames,

And I was just trying to share the FACT that you have not been completely honest in your past communications. I believe the past performance of the messenger is entirely relevant to the message.

The question really isn't whether US Airways is in a tough spot - it clearly is. However, your employees are being coerced into taking concessions that are completely out of proportion to their role in US Airways' plight. If all the proposed agreements are ratified and US Airways emerges from Chapt 11, I'm sure that you will make out far better than any of them in proportion to the sacrifices made.

Here's the real question. You state that there is no Plan B if ratification fails. The Company will close its doors if even one union fails to ratify. Did I get that correct? Okay, for the sake of argument (and we will know soon), what if a union fails to ratify, and management goes to Plan B? What if US really don't go Chapt 7? That would imply that either you were not completely honest with your employees, or someone wasn't completely honest with you. Please tell us now, before the votes are tallied, what you are going to do then.

Inquiring minds want to know....

As far as the APA "sickout", that discussion can be held somewhere else because YOUR employees have other things on their minds. However, for those who haven't followed the whole thread, it was Mr Chiames, and not I who broached the subject in the first place. Of course, when in doubt, by all means, change the subject!

regards,

Andy S.