Sky Talk

AA unions tout turnaround, blast 'money grab'

Union leaders at American Airlines have been highly critical of company's direction in recent years, but today they have some hopeful things to say about the future. Blasts from the Allied Pilots Association and the Association of Professional Flight Attendants both highlighted AMR Corp.'s better-than-expected first-quarter financial performance, and noted that analysts have expressed optimism for the rest of the year.

"Mmost analysts now foresee a industry turnaround throughout the remainder of the year as the high travel season progresses, capacity cuts come closer to matching passenger demand and the economy overall begins to show its long-hoped-for improvement," the APFA wrote to members.

And the APA wrote that "industry analysts agree that the end of the quarter could signal the beginning of a long-awaited turnaround and most are upgrading their 2009 earning projections for AMR and the industry."

It should be noted, of course, that the unions are in contract negotiations, and a return to profitability would bolster their argument that AMR can afford to give employees raises and improved benefits and work rules. Still, any positive talk from AA labor is worth some attention.

And lest one think it's suddenly all roses and sunshine from the unions, both groups slammed executives for their annual stock bonuses, which were paid out this week. Pilots said the payouts were "just another example of how detached AMR management is from their employees," while flight attendants said they were the "2009 version of the AMR spring money grab."

- Trebor Banstetter

American, pilots forge new safety agreement

After months of wrangling, American Airlines and the Allied Pilots Association have finally forged an agreement to renew the Aviation Safety Action Partnership, the program that allows pilots to report safety-related problems without fear of reprisal from the company or the FAA.

This from the pilot's union:

The APA, AA Safety and the Flight Department are pleased to announce that we have come to an agreement on a new ASAP Memorandum of Understanding. A concerted effort to revive the program began last week and the groups were able to forge an MOU that provides both the protections needed by the pilots and the program fundamentals required by the airline. This MOU has been signed by APA and AA and awaits final FAA approval.

Details of the new MOU are available on the APA Web site and on AAPilots. We expect ASAP to begin accepting reports upon FAA approval.

We are also pleased that, together, we were able to bring back a critical safety program that has served our pilots, our airline and our industry so well for so many years. Not only that, but in the process, we improved upon and created a program that once again sets the standard for our industry.

- Trebor Banstetter

Schnurman rips American pilots, again

I hope Mitch Schnurman isn't flying American any time soon - the pilot may eject him from the plane at 30,000 feet. The Star-Telegram business columnist tore into the Allied Pilots Association for the second time in recent weeks, arguing that the union is way off base when they compare the executive bonuses at AMR Corp. to the payouts at bailed-out insurance giant AIG.

"This must be the pilots' version of Dumb and Dumber," he begins. He goes on:

Disgraced AIG represents the worst side of Wall Street, with irresponsible risk-taking and unchecked greed. It’s a failed company, kept alive only by government funds, and it’s come to symbolize all that went wrong with the global economy.

AMR’s record couldn’t be more different. It remains a great turnaround story, even with its dysfunctional labor relations. It’s the only legacy carrier that managed to restructure without government loans after 9-11, and, more importantly, without resorting to bankruptcy court.

This comes after this March 11 column, in which Schnurman wrote that the pilots need a "reality check" and asked if they are "Irrelevant? Out of touch? Just plain dumb?"

It should be noted that Schnurman has been critical of American management in the past as well, particularly on the bonus issue. He called on CEO Gerard Arpey to reject or defer the bonuses until employees get a similar payout based on the company's success.

Still, he may want to fly Southwest for a while, just to be safe ...

- Trebor Banstetter

AA pilot leaders blast union's board

The infighting continues at the Allied Pilots Association, the union that represents pilots at American Airlines.

We reported last week on the decision by the union's board of directors to censure the union's president and vice president, and reprimand its secretary-treasurer. Now, the three officers have fired back with a missive to union members asking them to take a hard look at the board's policies and actives and become "more proactive" with the union's leadership.

"All too frequently of late, I regretfully find myself questioning if many of the board’s contemplated policy changes are beneficial or even necessary in the battle to achieve our restorative contract," wrote union president Lloyd Hill.

And vice president Tom Westbrook wrote: "Those disagreements (between the board and the officers) are now being used in an attempt to justify board resolutions that are radically altering the governing mechanisms of your union. Just last week, the Board voted to remove any presidential involvement with strategic planning and to significantly reduce his ability to communicate with the members and shape APA’s public message."

Keep reading for the complete message.

- Trebor Banstetter

Infighting at AA pilot union

The board of directors of the Allied Pilots Association censured union president Lloyd Hill and vice president Tom Westbrook yesterday. While some board members have grumbled for some time about the tactics of the national officers, it's the first public rebuke of the leadership.

Here's what the union said in a hotline to pilots late Thursday:

Prior to adjourning, the Board of Directors passed a motion to censure APA President Captain Lloyd Hill and Vice President Captain Tom Westbrook for "frequently failing to adhere to the policies, directives, and resolutions of the Board of Directors."

Hill and Westbrook are elected by American Airlines pilots, but they report to the board, so there's often an uncomfortable tension between the officers and the directors. Board members are elected by the members of their domiciles, such as D/FW Airport, Chicago and Miami.

As we report in our story, Hill's aggressive tactics against American management haven't always been embraced by board members. But spokesman Sam Mayer - a former board member who has seen many union political battles over the years - pointed out that it isn't the first time that a union board has called the national officers on the carpet.

"Sometimes you can hear the shouting from outside APA headquarters," he said. "This time you couldn't hear anything (outside the meeting room) so they probably weren't being screamed at."

Last year, the board considered a resolution that would have stripped the national officers of some of their power, and would have abolished the secretary/treasurer position. That resolution was tabled and hasn't resurfaced.

- Trebor Banstetter

Schnurman: AA pilots need 'reality check'

Star-Telegram business columnist Mitch Schnurman weighs in today on last week's "national announcement day," the Allied Pilots Association event in which the union held meetings nationwide to discuss a strategy for job actions. They proposed tactics including pilot walkouts on targeted routes if contract talks break down.

Schnurman, not known for pulling his punches, opines that, given the state of the economy, "these union brothers must be from another planet." He wonders whether they are "irrelevant," "out of touch" or "just plain dumb?"

You can read the column, which won't likely win Schnurman much fan mail from APA members, here. To be fair, Schnurman has been pretty hard on American Airlines management in the past as well - he excoriated Don Carty in 2003 when the airline revealed a slate of executive pension perks and bonuses right after employees took concessions. He also called on Gerard Arpey to cancel or restructure a similarly controversial annual stock bonus program for top executives and managers.

Feel free to send Mitch an email if you have any opinions on the topic.

- Trebor Banstetter

AA pilots plot strike strategy

We have a story in this morning's Star-Telegram about the meetings held by the Allied Pilots Association to sketch out their strategy if contract talks hit an impasse. You can read it here.

In a nutshell, their plans are to hit American with a series of small job actions rather than a broad walkoff that would shut down the airline. That seems to be aimed at preventing President Obama from declaring a transportation emergency and ordering pilots back to work, which he can do under the Railway Labor Act.

Pilots are also hoping that Obama will appoint some pro-labor members to the National Mediation Board. Only the board can declare talks at an impasse, an thus far they haven't shown any moves in that direction. But more labor-friendly board members may be willing to let it happen.

Under the law, the president appoints all three members of the mediation board, two of which are from his party and one from the opposing party. The current members are all Bush appointees.

- Trebor Banstetter

AA pilots gather for strike briefing

Pilots at American Airlines are attending union meetings today to discuss strategies for a strike if labor talks reach an impasse.

Officials with the Allied Pilots Association have been saying for months now that they don't anticipate a general strike, rather, they plan to enact a series of smaller actions that would disrupt operations but not shut down the airline entirely. Union president Lloyd Hill outlined that scenario in an interview with the Star-Telegram last November.

We're heading out to talk to pilots at the D/FW domicile meeting, and will report back here and at Star-Telegram.com.

- Trebor Banstetter

Not yet at impasse, AA pilots prepare for strike

This, from Bloomberg News today:

American Airlines pilots will gather in meetings around the U.S. tomorrow to hear details of job actions their union plans should they be allowed to go on strike against the world’s second-biggest carrier.

The Allied Pilots Association has said it doesn’t plan a nationwide walkout against Fort Worth, Texas-based American. At the briefings in seven cities, the 11,500-member union will tell members what it intends and what roles they would have.

“We are laying out our case and getting them comfortable with the concept of something other than a general strike and providing an opportunity to answer questions,” Sam Mayer, a union spokesman, said in an interview. “Right now, if you asked what they’d do in a strike, 97 percent would say they’re packing their bags and going fishing.”

The meetings are a sign of increased tensions between AMR Corp.’s American and the union, which began talks in September 2006. Negotiations will resume next week, after a six-week break. AMR is trying to hold down costs after net losses in four of the past five quarters, as fuel prices rose to a record high in July and then air-travel demand dropped during the recession.

Mayer declined to detail the union’s plan, while saying one component may be partial strikes in some cities or pilot bases. The pilots have yet to ask the National Mediation Board, which began overseeing talks in May 2008, to declare an impasse, one step required by law before they could strike.

"A strike could be catastrophic for any airline and its employees in the current environment,” said John Budd, an industrial relations professor at the Universityof Minnesota’s Carlson School of Business. “Limited, partial disruptions might not be out of the question, but will need to be used sparingly so that they do not bankrupt the carrier.”

American’s negotiators “believe that time is best spent by working to find mutually beneficial solutions to the issues at hand,” Sue Gordon, a spokeswoman for the carrier, said today.

Under federal law, either party in airline bargaining can ask the mediation board to declare talks at an impasse. After such a ruling, both sides are offered binding arbitration. If either declines, a 30-day cooling-off period begins. A union can strike at the end of that period if no accord is reached.

The union has said it won’t seek an impasse declaration until a new mediation board is named by President Barack Obama. The union also has said it won’t stage any illegal job actions such as sickouts or work slowdowns.

The pilots’ plans to avoid a strike across American’s entire network may reduce the chances that Obama would intervene to stop a walkout, Mayer said.

A 1997 strike by American’s pilots lasted only minutes before then-President Clinton ordered them back to work and created a presidential emergency board to mediate the dispute during an additional 60-day cooling-off period. A president can convene such a panel when a strike threatens to snarl essential national transportation.

_ Scott Nishimura

Arpey declines offer to get involved in pilot talks

Last week, the Allied Pilots Association asked American CEO Gerard Arpey to get personally involved in stalled contract talks. In a Feb. 4 letter, union president Lloyd Hill wrote that "it has become increasingly evident that the time has come for you to exert your influence to help resolve the APA-American Airlines contract negotiations expeditiously."

He wrote that both sides want the contract finished, and that "the alternative is continued uncertainty, which no one likes when they're making travel plans."

Hill said he was ready to meet with the CEO at any time. But Arpey responded that he would prefer talks continue under the oversight of federal mediators. In a letter to Hill, Arpey said that he is "committed to reaching a contract with the Allied Pilots Association that meets the best interests of American Airlines and its pilots."

He added that "we take this process seriously; our negotiators are focused on reaching agreement on the unresolved contract issues in ways that meet the long term interests of both parties."

There is a precedent for top management getting directly involved in contract disputes. In 2004, Herb Kelleher and Colleen Barrett personally took over deadlocked talks between Southwest and its flight attendants and managed to hammer out a deal within a few weeks.

As far as we know, Hill and Arpey have never met, although Arpey has met with top officials with unions representing flight attendants and ground workers.

- Trebor Banstetter