American Airline Pilots' Slowdown Wins a Victory, Despite What You Read in the DMN

Categories: Schutze

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Mitchell Schnurman is a really good business reporter. The Dallas Morning News scored a major coup recently when it hired him away from the Fort Worth Star-Telegram. He's an ace, the author of serial scoops on airline industry management.

But as we see again in today's paper, Schnurman is strangely obtuse when he starts handing out moral advice to the rank and file. Schnurman posts yet another in what is fast becoming a regular series of preachy epistles to the pilots union, scolding them for their rogue slowdown action at American Airlines.

He says, "The negative publicity couldn't be much worse, as cancellations made national and local headlines. ... Plenty of pilots who are doing their jobs must be embarrassed, too. They often talk about getting the respect they deserve, especially from management, but these tactics put their interests ahead of everyone else's."

Funny. For all this finger-wagging and tch-tching in the paper this morning, I still don't see the real story about American Airlines. I am scouring my very expensive print version of the paper. Nope. Not there. I go back over the web page as well, navigating around the "Ask Mitch Manners" column to look for some news.

No. Not there, either. Maybe they'll move themselves to get it up by the time my item gets posted on Unfair Park.

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labordallas.org
So as a last resort I go to my usual source for big Dallas business stories that the local paper doesn't like: The Christian Science Monitor. Sure. There it is, big and bold! I thought I saw that mentioned on TV just before the lights went out in my head last night: Management at American has agreed to go back to the bargaining table with the pilots!

That's the real story today. That's the news. The headline at the top of the front page of any honest morning paper in this town today should be: IT WORKED!

Damn straight. By dragging the company out to the edge of the cliff -- and only by that! -- the pilots have been able to push a stubborn management team off its arrogant dime. Management was determined to cover its own incompetence with blood drained from the pilots' contract. The pilots showed them that the blood would be their own.

Is that really how it's done? Do you really threaten to harm the company if they won't talk? Do you really threaten to shut it down? Of course you do! How in the hell do we think labor ever got management to talk in the first place?

The labor movement and unions in this country have weakened to the point of near extinction in the last 20 years because union members have lost the courage and resolve that the American Airlines pilots found again in this dispute.

It ain't tiddlywinks. Americans were able to form unions and fight for decent pay in the first place only because workers weren't afraid of an ultimate shootout. They had the courage to go out to that line and face the management goons sent there to beat and even kill them, if that's what it took.

Maybe it's time for working and middle class Americans to stop bitching about the plague of income disparity gnawing at the very fiber of our society. Maybe it's time people remembered that in this world you get what you're willing to fight for.

Not take. Not steal. Fight for. An honest day's wages for an honest day's work. And when management, acting under Wall Street rules, tries to turn that principle on its head -- comes up with a plan by which the CEO gets a larcenous bonus for doing a lousy job while labor gets the shaft -- then, yes, labor has to be ready to toe that ultimate line.

In today's America on any given day, it can seem like management has all the tricks and the ammo. They rewrite the laws themselves. They stack the courts with cronies. And they fill their newspapers with propaganda.

But as the American Airlines pilots have reminded us, labor always has the ultimate weapon. The one leverage. The last resort.

Shut it down.

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63 comments
clfrancis
clfrancis

Ask the families of Continental Connection flight 3407 and US Airways flight 1549 how much they believe a well trained professional pilot is worth.  You get what you pay for.  There is a price for well trained, experienced professionals.  Majority of flights take off and land without any problems but the one time there is a problem, I expect the pilot to be well trained and experienced to handle an emergency.  You can't put a price on experience when lives are saved and a billion dollar aircraft is not put into the ground. Keep beating up on the pilots and see what you get 5 or 10 years from now.  The pilots are an airlines best asset.

TheCredibleHulk
TheCredibleHulk topcommenter

I'm damn glad I really have no need to fly anywhere, anymore.

RTGolden1
RTGolden1 topcommenter

Just thought I'd mention this in passing, it really has nothing to do with the story, and is not meant to take away from any of Jim's salient points.

 

Aren't most airline pilots "Old, White, Guys"?  Jim, why are you suddenly defending the demographic you most like to ridicule?

JimSX
JimSX topcommenter

When you let the game get to Russian Roulette, it's too late to worry about the wallpaper.

rjj767
rjj767

Bet on the Come

Let me tell you a story about a hypothetical situation to help your readers understand.   Let’s assume you’ve been working for a newspaper for 27 years.  This newspaper has brought in a new CEO that has promised his BOD a restructuring of the company that will promise the senior executives huge bonuses in about 2 years.  Your employer has a large amount of cash on hand, probably more than most of the competition however; he feels that if he drags the company through bankruptcy, he will significantly undercut the competition’s cost structure.  You hope that your contributions to the organization over all of those years will put you in a position to enjoy the fruits of your labor.  Finally, the offer comes across your desk.  You are shocked!  Your compensation will be significantly below the other writers at other papers doing your same work, your benefits will cost you more, and a promise of a percentage cut in the new venture may not actually survive the bankruptcy process.   They hope to give you a small token percentage, but it’s impossible to tell you what it might be worth, or even if will survive bankruptcy.  Wait!  Before you decide to accept your fate of being cut out of the future profits, a competing company has suggested they might want to take over your company.  They actually negotiate a better deal than what you have been offered by your own management team.  Now let’s see, do I roll over and play dead and take the deal, or do I hope to enjoy the fruits of my labor, even if it might be with new management?  The deal simmers as time goes by. It’s time to get busy on a new project.  If things don’t go well in the short-term, the outside offer might have a better chance for success.  If things go well, the current team will succeed, and their success will not include you.  So, the printer fails and the computer needs repair.   You could probably do the repairs, but why should you?  You used to arrive early, but why should you?  Get the picture?  You don’t really need to do anything wrong, you just don’t need to do anything beyond your well-defined job description. The paper is late, the stories are short, sales drop, so what? You’re betting on the come.

 

everlastingphelps
everlastingphelps topcommenter

If by winning, you mean that the pilots drove another (possibly the final) nail in AMR's coffin, then we are in agreement.

BuffaloPrinter
BuffaloPrinter

The pilots are fighting for:

14 work days in a given month

a $1.5M pension upon retirement

a retirement age of 50

annual salary of $180K or so

 

Frankly, pilots should not be compared to a typical "hard working American laborer".  Benefits and salary such as this put them in the highest 5% of wage earners.  At least the pilots have a union to fight on their behalf, unlike many of the analysts, call agents, and middle managers who make much, much less than the pilots do.

 

Sorry if these are just ballpark numbers, but my point is I grow tired of hearing well-compensated people whine about pay cuts when other American employees making 40-50K are taking pay cuts too.

Fb2012
Fb2012

Note to pilots. Worry about your customers or you won't have a pay check.

MitchellSchnurman
MitchellSchnurman

With all due respect, Jim, isn’t it a little early to declare victory for the pilots?

 

Their slowdown has the attention of everyone, especially management. But they could have resumed negotiations at any time without causing such collateral damage. Since the pilots union rejected the last, best offer in August (and eight other bargaining units approved their deals), American has said repeatedly that it wanted to negotiate a new contract. The unsecured creditors committee has voiced the same sentiment.

 

Surely, management must be more eager to talk, given the hit caused by the pilot slowdown. The proof of the pudding, however, is the deal that emerges. If the pilots get a better contract than they turned down in August, your premise will stand: “IT WORKED.”

 

If the contract is worth the same, or less, what’s the result of all the disruptions? Some workers may take pleasure in the pain they caused, but most stakeholders will feel like they suffered for nothing.

 

This game plan has played out before, as cited in my column. United pilots have been operating under an injunction for four years, following a summer sickout, and they still don’t have a new contract. US Air pilots have had an injunction since last year, and that hasn’t led to an agreement.

 

It could be different for American pilots, but I don’t think so, especially with Chapter 11 restrictions. If pilots win any more benefits than they turned down in August, the company would have to increase the value of the contracts for the eight other groups that already signed deals.

 

Me-too clauses make improvements a lot more expensive. So I believe the die is cast, and the only question is how pilots get from here to there.

txfluv
txfluv

The pilots are spoiled brats that only think of themselves and do not have to play by the rules. The are overpaid and under worked. The fly the planes safely for themselves, not the passengers. They can come to fly drunk and if caught get fired, but later get reinstated because the union files grievances and always wins. The pilots have nothing invested in AA except time. They care nothing about the 1000's of passengers the hurt, through missed meetings, lost cruise line departures, get to see a loved one that may be dying. The list goes on and the pilots could care less! Just give the that big ol' teat to nurse on. Money money Money

LucreziaDeMontebello
LucreziaDeMontebello

The pilots must not back down to pressure.  Ruthless capitalist bastards want the best for the cheapest.  Just look at what the capitalist greed masters have done to the NFL with their unqualified non-union refs.

Knine
Knine

This is the best article I have read in a long time.  "Keep working and hope" is not a strategy that works except for management.  There is an old saying that rings true "You get the union you deserve.".  By the way, look at how cordial things are at Delta and SWA between the unionized pilots and management.  

RTGolden1
RTGolden1 topcommenter

"The labor movement and unions in this country have weakened to the point of near extinction in the last 20 years because union members have lost the courage and resolve that the American Airlines pilots found again in this dispute."

 

Utter horse poop.  Unions have weakened over the years because they've overstepped their original intent.  Unions work within the framework of very large corporations that can absorb the legacy costs of having union labor.  Small and medium businesses cannot afford unions, and the workforce is gradually gravitating toward small and medium businesses.  When you tie in retirement plans, retirement healthcare costs and the host of other legacy costs union labor comes with, a small or medium sized company just can't utilize union workers.  

 

Unions have to realize that A) every company/business is as unique as every person is, there can be no "one size fits all" union contracts.; and B)there comes a point where the unions have to stop asking for more and doing less.

 

Hell, even Unions don't like to use Union Labor:

 

http://www.chron.com/business/article/Nonunion-workers-built-Teamsters-building-2108406.php

Fb2012
Fb2012

American needs business travelers to pay the bills. Once they start booking and racking up frequent flier miles on another carrier or miss an important appointment because of a bogus safety claim or slow taxi they won't book on American again. In markets like Chicago, where American is second, that will cause real problems for the airline's future.  If an American pilot moves to another carrier they start at the very bottom of the seniority ladder if they can get another job at all. So killing the airline with a work slowdown hurts them and all of their fellow employees by driving away the folks who are paying the bills. A better and more intelligent strategy would be to keep working and hope for a merger if they really think that will make the airline stronger in the future. Screwing your customers, no matter how you rationalize it, is never a wise move. As for management remember Don Carty. They drove him out and he went on to make more than he was earning at American at Dell Computer. Much more.  

rjj767
rjj767

 @BuffaloPrinter Your numbers are out to lunch.  Try to imagine being in a business where the profits are in the billions.  Management steals millions in bonuses while you do the work.  Get the picture?

JimSX
JimSX topcommenter

 @BuffaloPrinter The problem, Buffalo, is that your reductionism here winds up saying that no one ever has a right to seek fair compensation because somebody always makes less, and that's not fair. So I guess you think everybody should be paid the same. Kind of a commie, ain't you?

ScottsMerkin
ScottsMerkin topcommenter

 @BuffaloPrinter how many of the 40k a year guys spent $100k of there own money to take job in their profession?  Many pilots start out making less than the accountants and other non union groups start at.  Pilots are limited to 1000 flight hours a year so they cant really work more than 15-20 days a month.  when you work a day at work, is it 8 hours at the office, or are you away from home for 72 hrs straight?

JimSX
JimSX topcommenter

 @Fb2012 Note to management: worry about your pilots or you won't have customers.

xocheeta
xocheeta

 @MitchellSchnurman

 

You and other are forgetting a major difference between AA and the other airlines.  AA's pilots took a MAJOR pay cut ( ~30%) after  9/11, to keep a bankruptcy from occurring. That did not occur with ANY of the other airlines. 

 

After the major paycut, AA was able to survive almost 10 years longer. However,

 as soon a profit was made, the executives gave themselves millions in bonuses. When questioned why management did not give the bonus to all the employees, one executive responded that it would only be $43 per employee. That was the beginning of the feud between management and employees. Management made it clear that when it came to money, they were not going to sacrifice anything.

 

None of the other airlines pilot's took a wage cut prior to bankruptcy.  United and US Air pilots may not be working under a contract, but their wages are not over 10 years behind the average pay scale.  AA pilots made much more 10 years ago. That old pay (prior to a voluntary pay cut) is closer to the current pay for the pilots at United and Delta.

 

American did not say that they wanted to renegotiate after the judge's ruling. In fact, a blast e-mail was sent to the pilots saying that they were now under the

"contract" written by management (the LBFO). That contract allowed 1 sick day per year. I don't know about you, but I certainly prefer a healthy pilot flying the plane. They are going to fly no matter what the sickness with that type of childish garbage in the "contract."

 

There are a lot of issues in that offer that are just childish. However, management had to show their big hammer by giving orders to the pilots. Ironically management drove AA into bankruptcy, not the pilots. However, they expect the pilots to pull AA out of bankruptcy.

 

American's management only opened the idea of negotiations after the slow-down.

PerryMoore
PerryMoore

If you intend to meet Mr. Schutze on common ground, you need to ease back on the history and logic. In the blogosphere, most folks breathe anger and write in the moment.

ScottsMerkin
ScottsMerkin topcommenter

 @MitchellSchnurman how can you blame the pilots for turning down the LBFO, it wasn't a full negotiated deal, it was a "lets send this out and let the pilots decide if the they like the LBFO"  Was it better than the term sheet? sure but it was no where near section 6 negotiations.   My best guess is they take something better than the LBFO but less than what they had pre bankruptcy.  And there are ways around those me too clauses with the other unions. Certain parts of the agreements have me-too's but there are other part where the APA could get better work rules without it affecting the unions.  Its the equity stakes, bonus' 401k's and such tht they would have to match

JimSX
JimSX topcommenter

Really good points. I note your caveat -- that the company probably is more eager to talk because of the slow-down. But clearly your are correct in saying that the game ain't over yet. 

xocheeta
xocheeta

 @txfluv

 Sounds like you're a tad bit jealous. Why else would you make such a broad judgement of them? 

scottsbiz
scottsbiz

 @txfluv and what does that say of management, that bullies the employees, doesn't care about the passengers, and takes all the money even when they fail?

ScottsMerkin
ScottsMerkin topcommenter

 @txfluv if they didnt care about you, you'd be on planes that had blown out tires, bad brakes, broken lights and all kinds of mechanical issues you'd never even care to know about.  

ceepee
ceepee

 @txfluv couldn't care less.... it's couldn't care less. FWIW

fliesemall
fliesemall

 @Knine Only Union at Delta is the Pilot's Union.  SWA ismore unionized, but have no pensions or scope to fight for.

JimSX
JimSX topcommenter

 @RTGolden1 Utter horse poop. Management will never agree to a fair sharing of profits born of increased productivity unless labor can force management to the table. The boom that made this country rich after World War II was built on the spending power of empowered workers. Stripping workers of bargaining power is a way to strip the nation of its economic might. The lesson of the Reagan/Bush administrations is that America's ultra-conservative business leadership claque is retarded where basic economics is concerned -- that's why Democrats produce prosperity and Republicans produce recession. Liberals are smarter about money than conservatives. They know how to make money.  Conservatives know how to hoard it.

oakclifftownie
oakclifftownie

 @Fb2012 Logic and reasoning left both sides of the equation years ago..

Its like each seems to enjoy watching the other twist in the wind .

 

 

ScottsMerkin
ScottsMerkin topcommenter

 @Fb2012 they remember Carty and crandall, and Arpey, and they run them off then 10 yrs later wind up wishing for the old days of management.  Its rather comical actually

eric.hilton
eric.hilton

 @JimSX  @BuffaloPrinter I note your irony; but the pilots chose their line of work like the rest of us (sort of). They can seek whatever they like. Gigantic unions, and gigantic companies both make terrible decisions and cause terrible problems. Here each is doing so and causing all sorts of problems. I feel little sympathy for either side. I just want to get to and from my destination safely for a fair (there's that word again) price. 

BuffaloPrinter
BuffaloPrinter

 @JimSX Good points both.  I still don't like the pilots' tactics, not to say the executives are fully in the right either.  But having a pilots union in your corner to protect the best paid employees draws similarities to tax cuts for the wealthy.

txfluv
txfluv

 @ceepee You're right. My fingers didn't keep up with my pea size brain.

WhiteWhale
WhiteWhale

 @JimSX  @RTGolden1 Jim - Do you mean Democrats like Jon Corzine, Bernie Madoff and Timmy Geithner.  Democrat crony capitalism does not produce long term prosperity.

RTGolden1
RTGolden1 topcommenter

 @JimSX way to go Jim.  Don't address a single point I brought up, but blather about "what made this country great way back when..."  neither Dems nor Reps produce prosperity, unless you're talking about political prosperity.  Both of them know how to SPEND money, neither of them has a clue about how to make money, except to raise taxes or increase debt.

 

Small business is the fastest growing employer segment in the economy. Small business cannot afford Union legacy costs.  As we're finding out from the last several years, even huge corporations cannot afford the volatile mix of executive privilege AND union legacy.

ScottsMerkin
ScottsMerkin topcommenter

 @JimSX  @RTGolden1 umm, Jim, they was an offer on the table for 15% equity in exchange for more productivity, it was part of the offer they turned down.  It was there and now its gone.  They will be lucky if that offer gets put back on the table when they finally return to negotiate

michael76180
michael76180

 @BuffaloPrinter  @ScottsMerkin Lmao ... 99% of major airline pilots today have *AT LEAST* that four-degree!  I have a Master's degree also, as do many of my peers.   Most airline pilots spent an average of 10-20 years at lower-paying positions before they have the credentials to get hired by a major airline flying heavy metal. 

 

Those who took the military route probably served their country for a full decade (or more)  willing to pay the ultimate price for the freedoms of all Americans.   Are you a military veteran?   Were you willing to die for your country?  Did you spend weeks or months away from your family while serving your country?   

 

Those who didn't take the military route "paid their dues" with low-paying jobs flying as private-pilot flight instructors, night freight flying jobs, etc.  We're talking jobs that pay less than $20K per year.  They also had the privilege of paying for hundreds of hours of flight ratings (Private, Instrument, Commercial, Multi-Engine, aircraft "Type" ratings, etc) which cost them tens of thousands of dollars ON TOP OF their college degrees.  

 

Many airline pilots, especially those who have been waiting for 20+ years to upgrade to "Captain" don't make anywhere close to the salary you mention.  (Yes, this is happening now based purely on the seniority system at many major airlines.)

 

Airline pilots are trusted with the lives of 200 people every time they go to work  -- literally have those lives in their hands.  Do surgeons do that?  No, they handle one life at at time, but no one questions them being well-compensated after decades of cultivating their education and skills. 

ThePosterFormerlyKnownasPaul
ThePosterFormerlyKnownasPaul topcommenter

 @TVH777  @JimSX  @Fb2012 Last time I was on an AA flight was better than 5 years ago ...  I haven't missed you and I fly regularly ...

 

At one time I could purchase a ticket on SWA to IAH and then fly Continental to the Northeast cheaper than I could fly AA cheaper to the Northeast.

 

Then there was the deal of flying to Austin on SWA to catch the Austin - DFW - LGA and pay half of what it would cost to fly from DFW to LGA, including the SWA tickets!

 

Besides all of you (management and pilots) agreed to the seniority system for your jobs, so don't come and use this as a point to complain about.  You can always scrap it and go to a strict rotation or a lottery method for you flight assignment.

TVH777
TVH777

 @ThePosterFormerlyKnownasPaul  @JimSX  @Fb2012 Note to customers.  Management has taught us well that you will fly us again.  History reveals this over and over again.  As soon as the disruption stops, the internet fares are lowered and the frequent flyer hostages are back buying tickets on AAL.  It works every time and management knows this.

 

So you will be back!  Price rules in this internet age, and when load factors increase-wha-la the price goes back up.  Again you will be back-see ya.

everlastingphelps
everlastingphelps topcommenter

 @ScottsMerkin  @ThePosterFormerlyKnownasPaul  @txfluv http://articles.chicagotribune.com/2012-09-24/business/chi-delays-cancellations-grow-at-american-airlines-20120924_1_sick-rates-normal-historical-rates-cancellations

 

"Spokesman Bruce Hicks said Monday that the airline wants pilots to continue to request maintenance on important problems, especially safety issues. But some of the reports recently have been for broken coffee pots, non-functioning passenger reading lights and torn seatback pockets. One pilot on Monday wrote up a report because his seat "didn't feel just right," Hicks said."

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