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Thread: Parker asking AA pilots for concessions

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    Parker asking AA pilots for concessions


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    PHL Update


    Dear PHL Pilots,


    Last week, both Paul DiOrio and Paul Music hosted a meet-and-greet in both the A and B concourse crew rooms. While we were able to answer many questions, there was a clear misunderstanding of the current issue regarding potential arbitration that requires clarification.


    To better understand where we are, let's recall how we got here. To start, when the MOU was approved, we agreed to the established MOU pay rates and to be governed by the Merger Transition Agreement (MTA), also known as the Green Book. Notwithstanding the implementation problems we have been dealing with, this is the contract we will living under until the 12/31/2018 amendable date and likely several years beyond. Also in the contract is a mid-contract pay adjustment that essentially will pay us the average of both Delta and United, which amounts to about a 16.5% raise on 1/1/2016. The three-year delay permitted the company time to capture the synergies and realize the benefits of the merger. As we now know, the benefits of the merger have occurred well before the 1/1/2016 date. (further explanation...in other words if we turn down this proposal now we will get a payraise on 1/1/16 and the contract will expire on 12/31/2018.* If we take the proposal, we get a raise now but have to extend our contact one more year.


    It's also important to understand that before USAPA's involvement, CEO Parker met with the APA board and "promised" them that should the company capture the synergies, revenues and profits earlier than anticipated, he would bring the pilots' pay up earlier than the negotiated three-year mid-contract adjustment. Specifically, Doug Parker told APA: "When we make Delta profits, I'll pay you Delta wages."He also told the APA board that because this Delta pay issue may be problematic with the unsecured creditors, he couldn't make it a part of the written contract, but he assured APA this would occur. The problem is that in the company's recent "take it or leave it" proposal, we would be paid "Delta wages" for only the first year of the contract; we would then trail them for many years beyond. Their proposal, of course, also didn't include profit-sharing, which last year equated to an additional 15% for Delta pilots and was conditional on accepting several work rule concessions.


    First, they wanted Scope concessions (76 to 81 seats), which many believed was nothing more than manufactured negotiating capital. After they removed the five-seat request, they added SIX concessions that they said had "no value" even though they have enormous value and refused to consider any of our quality-of-life issues. In fact, they advised APA that in order for the company to continue negotiations, APA must agree to discuss only their six concessions, which include job loss and adding a year to our contract. In essence, like the MOU, they want us to focus on the pay raise and ignore everything else. Been there, done that.*


    *If we accepted the company's proposal, we would receive next year's pay raise a year early; however, we have to pay for it with permanent quality-of-life concessions. Furthermore, if we accept the company's proposal, within about a year, we will again be below our peers at Delta and likely will remain there for another five to seven years.


    As you know, we continue negotiations this week. However, if we ultimately cannot reach an agreement, we will continue to work under the Green Book. Moreover, there is not any requirement to go to arbitration unless APA chooses to make work rule changes. Remember, the sole purpose of the arbitration is to decide proposed work rule valuations. If APA decides to not make any modifications, then there are not any "costing" questions for an arbitrator to decide, and basically the process is over before it ever begins. Consequently, if we can't reach an agreement with the company in the next few weeks, we will still receive:


    3% RAISE on 1/1/2015

    16.5% RAISE on 1/1/2016

    3.5% RAISE on 1/1/2017

    3.5% RAISE on 1/1/2018 (28.5% cumulative total is exactly the same as the company's proposal for the same time period and unlike the company's proposal there are no accompanying concessions required) *

    NO WORK RULE CONCESSIONS

    NO SCOPE CONCESSIONS


    It is also important to understand that while the UAL contract is still years away, the Delta contract becomes amendable before 1/1/2016. With all airlines posting record profits beyond anyone's expectations (the drop in fuel since June will account for an additional savings of $4 billion for American alone), it is expected that the Delta pilots will receive a substantial raise. There is also talk that Delta may offer less profit-sharing in exchange for higher pay, which again will boost the industry average even higher.


    There is clearly a different culture at Delta than the one being fostered here at the "new" American. Their history is to get their contract negotiated before the amendable date and not drag it out for many years, as is the history with this management. By doing so, we expect the January 1, 2016, mid-contract adjustment to possibly be even higher than the expected 16.5%. Also, Delta CEO Anderson clearly understands that our pay is tied to their pilots' pay. It is obviously advantageous for Delta to have their contract completed before January 1, 2016, to prevent American from having an advantage with respect to pilot costs for years to come.


    The question becomes: What gives our pilots the greatest benefit? Accept an early pay increase in exchange for permanent work rule concessions that we will never recover, or wait the one year (which includes a 3% raise on 1/1/15) and accept the 1/1/16 pay adjustment, which will result in an additional 16.5% raise or possibly higher while not giving up anything in return?


    As you know, CEO Parker has never given up anything to labor that he was not forced to give up. For him to make this offer now is in our opinion clearly set to get him off the hook cheaply and for an extended term in addition to getting us to take lifelong concessions at a time of record profitability that we will likely never see again in any of our lifetimes.


    Recognizing that we are not interested in poking a stick in the eye of management, our priority is to get the maximum benefit for our pilots while allowing the company to compete. Our proposal does just that. We are the largest airline in the world, and we can be the best. To be a world-class airline, however, requires a world-class management team that energizes their employees. Delta and Southwest do it by investing in their people. We would like to think that Messrs. Parker and Kirby would understand this and accept the new paradigm that you do not have to be at odds with your employees to be successful.


    Unfortunately, for whatever reason, this management team continues to see it differently. Remember Doug Parker's recent comment that employees don't have that much impact on daily profits. Frank Lorenzo would be proud. In fact, in an article published last year, Lorenzo commented that "Doug Parker got it right." That endorsement speaks for itself.


    Rest assured that your concerns are our concerns and that we will do our best to get this management team to understand we are more experienced than any pilot group in the world and, through our sacrifices, are hugely responsible for the incredible financial success they enjoy today. We expect to be treated as such, anything less is unacceptable and truly inconsistent with Going for Great.


    Hope to see you at tomorrow's domicile meeting at the Airport Marriott from 9:00AM to 2:00PM.


    In Unity,


    Paul DiOrio Paul Music

    APA PHL Chairman APA PHL Vice-chairman

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    Can't tell we told you so. Apa thought Parker was the 2nd coming. However, it was the 2nd coming of frank lorenzo.

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    Trading QOL for money never works out well in the long term. The money ALWAYS gets renegotiated in the next contract, but the QOL issues become established fact and get forgotten. They never come back.

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    Quote Originally Posted by anshu View Post
    trading qol for money never works out well in the long term. The money always gets renegotiated in the next contract, but the qol issues become established fact and get forgotten. They never come back.
    agree 100%
    I always tell the truth. Even when I lie.

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    The take away from this letter for everyone should be.



    "As you know, CEO Parker has never given up anything to labor that he was not forced to give up. For him to make this offer now is in our opinion clearly set to get him off the hook cheaply and for an extended term in addition to getting us to take lifelong concessions at a time of record profitability that we will likely never see again in any of our lifetimes."


    Record profit and management is asking for concession at AA as well. We all give in bankruptcy and always will.


    Give concessions during record profits too??!


    NO. Not today, not tomorrow. If we do I want my $2000 or so annual union dues back.

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    Quote Originally Posted by downwind View Post
    Can't tell we told you so. Apa thought Parker was the 2nd coming. However, it was the 2nd coming of frank lorenzo.
    Indeed, he is the 2nd coming of Frank Lorenzo.
    I always tell the truth. Even when I lie.

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    Quote Originally Posted by NoOtPilot View Post
    Indeed, he is the 2nd coming of Frank Lorenzo.
    Wow, he can parrot what others say.

    “Mr. 318”

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    Quote Originally Posted by Dacuj View Post
    Wow, he can parrot what others say.

    “Mr. 318”
    Mr. 2021 to you I said.
    (318) is your area code, and the next digit is a 4. APA loves you.

    F2A6D471-6472-4492-B539-6908CFED7DA6.jpg
    Last edited by NoOtPilot; 12-07-2018 at 01:11 PM.

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    Quote Originally Posted by buddy View Post
    PHL Update


    Dear PHL Pilots,


    Last week, both Paul DiOrio and Paul Music hosted a meet-and-greet in both the A and B concourse crew rooms. While we were able to answer many questions, there was a clear misunderstanding of the current issue regarding potential arbitration that requires clarification.


    To better understand where we are, let's recall how we got here. To start, when the MOU was approved, we agreed to the established MOU pay rates and to be governed by the Merger Transition Agreement (MTA), also known as the Green Book. Notwithstanding the implementation problems we have been dealing with, this is the contract we will living under until the 12/31/2018 amendable date and likely several years beyond. Also in the contract is a mid-contract pay adjustment that essentially will pay us the average of both Delta and United, which amounts to about a 16.5% raise on 1/1/2016. The three-year delay permitted the company time to capture the synergies and realize the benefits of the merger. As we now know, the benefits of the merger have occurred well before the 1/1/2016 date. (further explanation...in other words if we turn down this proposal now we will get a payraise on 1/1/16 and the contract will expire on 12/31/2018.* If we take the proposal, we get a raise now but have to extend our contact one more year.


    It's also important to understand that before USAPA's involvement, CEO Parker met with the APA board and "promised" them that should the company capture the synergies, revenues and profits earlier than anticipated, he would bring the pilots' pay up earlier than the negotiated three-year mid-contract adjustment. Specifically, Doug Parker told APA: "When we make Delta profits, I'll pay you Delta wages."He also told the APA board that because this Delta pay issue may be problematic with the unsecured creditors, he couldn't make it a part of the written contract, but he assured APA this would occur. The problem is that in the company's recent "take it or leave it" proposal, we would be paid "Delta wages" for only the first year of the contract; we would then trail them for many years beyond. Their proposal, of course, also didn't include profit-sharing, which last year equated to an additional 15% for Delta pilots and was conditional on accepting several work rule concessions.


    First, they wanted Scope concessions (76 to 81 seats), which many believed was nothing more than manufactured negotiating capital. After they removed the five-seat request, they added SIX concessions that they said had "no value" even though they have enormous value and refused to consider any of our quality-of-life issues. In fact, they advised APA that in order for the company to continue negotiations, APA must agree to discuss only their six concessions, which include job loss and adding a year to our contract. In essence, like the MOU, they want us to focus on the pay raise and ignore everything else. Been there, done that.*


    *If we accepted the company's proposal, we would receive next year's pay raise a year early; however, we have to pay for it with permanent quality-of-life concessions. Furthermore, if we accept the company's proposal, within about a year, we will again be below our peers at Delta and likely will remain there for another five to seven years.


    As you know, we continue negotiations this week. However, if we ultimately cannot reach an agreement, we will continue to work under the Green Book. Moreover, there is not any requirement to go to arbitration unless APA chooses to make work rule changes. Remember, the sole purpose of the arbitration is to decide proposed work rule valuations. If APA decides to not make any modifications, then there are not any "costing" questions for an arbitrator to decide, and basically the process is over before it ever begins. Consequently, if we can't reach an agreement with the company in the next few weeks, we will still receive:


    3% RAISE on 1/1/2015

    16.5% RAISE on 1/1/2016

    3.5% RAISE on 1/1/2017

    3.5% RAISE on 1/1/2018 (28.5% cumulative total is exactly the same as the company's proposal for the same time period and unlike the company's proposal there are no accompanying concessions required) *

    NO WORK RULE CONCESSIONS

    NO SCOPE CONCESSIONS


    It is also important to understand that while the UAL contract is still years away, the Delta contract becomes amendable before 1/1/2016. With all airlines posting record profits beyond anyone's expectations (the drop in fuel since June will account for an additional savings of $4 billion for American alone), it is expected that the Delta pilots will receive a substantial raise. There is also talk that Delta may offer less profit-sharing in exchange for higher pay, which again will boost the industry average even higher.


    There is clearly a different culture at Delta than the one being fostered here at the "new" American. Their history is to get their contract negotiated before the amendable date and not drag it out for many years, as is the history with this management. By doing so, we expect the January 1, 2016, mid-contract adjustment to possibly be even higher than the expected 16.5%. Also, Delta CEO Anderson clearly understands that our pay is tied to their pilots' pay. It is obviously advantageous for Delta to have their contract completed before January 1, 2016, to prevent American from having an advantage with respect to pilot costs for years to come.


    The question becomes: What gives our pilots the greatest benefit? Accept an early pay increase in exchange for permanent work rule concessions that we will never recover, or wait the one year (which includes a 3% raise on 1/1/15) and accept the 1/1/16 pay adjustment, which will result in an additional 16.5% raise or possibly higher while not giving up anything in return?


    As you know, CEO Parker has never given up anything to labor that he was not forced to give up. For him to make this offer now is in our opinion clearly set to get him off the hook cheaply and for an extended term in addition to getting us to take lifelong concessions at a time of record profitability that we will likely never see again in any of our lifetimes.


    Recognizing that we are not interested in poking a stick in the eye of management, our priority is to get the maximum benefit for our pilots while allowing the company to compete. Our proposal does just that. We are the largest airline in the world, and we can be the best. To be a world-class airline, however, requires a world-class management team that energizes their employees. Delta and Southwest do it by investing in their people. We would like to think that Messrs. Parker and Kirby would understand this and accept the new paradigm that you do not have to be at odds with your employees to be successful.


    Unfortunately, for whatever reason, this management team continues to see it differently. Remember Doug Parker's recent comment that employees don't have that much impact on daily profits. Frank Lorenzo would be proud. In fact, in an article published last year, Lorenzo commented that "Doug Parker got it right." That endorsement speaks for itself.


    Rest assured that your concerns are our concerns and that we will do our best to get this management team to understand we are more experienced than any pilot group in the world and, through our sacrifices, are hugely responsible for the incredible financial success they enjoy today. We expect to be treated as such, anything less is unacceptable and truly inconsistent with Going for Great.


    Hope to see you at tomorrow's domicile meeting at the Airport Marriott from 9:00AM to 2:00PM.


    In Unity,


    Paul DiOrio Paul Music

    APA PHL Chairman APA PHL Vice-chairman
    This appears to be a base blast from years ago (2014), so not sure of your point. The specifics aren't current, but the sentiment and situation are and maybe that was your message. To wit, Parker and Isom will demand their own "concessions" from the AA pilot group in upcoming Section 6, some of which IMO will not be acceptable and thus it's likely little progress will occur. They don't give anything for free and even recently in the "Green Christmas" debacle, they got something in return for what they gave. Even the past mid-contract pay increase really wasn't benevolence, it was something enacted as it was believed it would pay off more in a smoother operation. Considering what AA pilots will need to bring their contract up to par with Delta and/or United (especially with improvements they are likely to get), the price for AAG will be MUCH higher and in their minds will HAVE to be paid somewhere else, namely Scope.

    Don't forget the AA mechanics also have their hands out now (and have for years in negotiations) and the F/A's have a "me too" clause that will splash more expense mostly from the pilots over to them. All in all, it adds up to big bucks for AAG. Again, front and center on their place setting will be outsourcing ability and for pilots (it's the major roadblock now with the mechanics) that means scope and that's B-A-D for both AA pilots job security and advancement and if junior at AA, it's especially bad. The other option is to continue on with the present contract ranking at least number 6 and soon falling further back and unless and/or until something forces Parker's hand, that might be AAG's preferred path. The saying, "know where you flow" is most apt in these trying times for pilots in the AAG nexus.
    Last edited by Beagleboy; 12-07-2018 at 08:16 PM.

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