Merger brings fresh start, new challenges for American Airlines unions
03/15/2014 4:34 PM
03/15/2014 8:27 PM
More than a dozen union representatives squeezed into an American Airlines conference room in the first week of February, invited by new Chief Executive Doug Parker.
The former US Airways CEO, who had been in charge of Fort Worth-based American Airlines Group for only two months, wanted to update the union leaders on the company’s finances and find out what their top priorities were now that the merger of the airlines was complete.
“It was a huge crowd,” said Laura Glading, president of the Association of Professional Flight Attendants. “He’s going to continue them quarterly so people can meet and voice their concerns, ask questions and get briefings from the company. So it’s a good thing.”
Regular state-of-the-airline meetings between American management and union leaders stopped after the carrier filed for bankruptcy in 2011. Parker and his executive team routinely held such meetings at US Airways to keep communication open between labor and management and expect to do the same at American.
“It gives you exposure to those directly running the company,” said Roger Holmin, president of the Association of Flight Attendants, which represents former US Airways attendants. “I can dial any one of them and they’ll take my call, or if they’re unavailable, they’ll return it. There is no chest-pounding going on.”
The meetings are one sign that labor relations are improving at the new American, where years of fighting between the last management team and its major unions helped drive the company into bankruptcy.
But the picture isn’t completely rosy. Other union leaders, particularly some who lead workers from the former US Airways, aren’t nearly as pleased with Parker and face tough choices in the coming months.
Unions for US Airways mechanics and ground workers did not support the merger, saying Parker neglected negotiating a new contract with their unions and instead focused on chasing American. Now that the carriers are combined, the unions want new contracts before integrating with their American counterparts.
“We are very upset that the company is making all kinds of money and they’re not willing to be fair with us,” said Frank O’Donnell, assistant general chairman of IAM’s District 141, which represents US Airways ground workers. “That’s all we’re asking.”
Pilots from American and US Airways are also locked in a legal battle over how to determine a seniority integration list, while pilots at the regional carrier American Eagle are voting on a contract that union leaders initially rejected.
Bringing together more than 80,000 workers from different unions is a daunting task for Parker and his executive team. At an investor conference last week, Parker acknowledged that labor relations at American have been adversarial for years. But he also believes that improving the dialogue between management and labor offers “the real upside” for the merger.
“Whatever happened in previous years resulted in an airline that can’t really achieve its potential because the management-labor relations had gotten so bad,” Parker said. “It’s really nice to be moving forward on those. A lot of work ahead, but I think there is so much you can do when you get everybody excited and working together that you can’t do when they’re not.”
With the carrier hiring hundreds of pilots and flight attendants in 2014, there are a lot of new faces and that, union leaders say, is helping morale.
“We tell our new-hire pilots when they’re coming in [that] this is a very good time to be coming in as a pilot for American Airlines,” said Keith Wilson, president of the Allied Pilots Association, adding that the airline has “a good management team focused on the operation and also engaging the employees … to solve problems and get things moving.”
For the unions at the new American, 2014 will be filled with contract negotiations, union representation decisions and the creation of the all-important integrated seniority list. Each work group is approaching the task a little differently.
Pilots jockey for control
A battle is brewing in the cockpit between the pilots unions at American and US Airways.
The Allied Pilots Association and the US Airline Pilots Association both supported the merger and signed a “memorandum of understanding” in January 2013 that laid out how they would become one union and start negotiating a new contract. APA, which represents American’s pilots, has filed with the National Mediation Board to represent the entire pilot group.
“Our focus is now that we have this merger and this merger is proceeding, that the pilots of American Airlines, which will hopefully soon be all of the pilots under the Allied Pilots Association, reap the rewards of the merger and the benefits thereof,” said Wilson, adding that the union hopes to improve the pilots’ quality of life in a new joint contract.
But disagreements over developing a seniority integration list have landed the unions in court. In February, USAPA sued in federal court in Washington, D.C., asking to start the process, laid out under federal law, right away to determine a single seniority list.
“Our issue is to ensure that the USAPA merger committee, who is the only representative of the former pilots of US Airways, is allowed to operate autonomously, fully funded and independently to represent the needs of the former pilots of US Airways until the seniority process comes to completion,” USAPA President Gary Hummel said.
The tension between the groups has spilled over to the rank-and-file pilots. Last month, a US Airways pilot refused to let American pilots sit in the jump seat during a flight, prompting the presidents of both unions to issue a joint statement telling pilots to respect jump-seat privileges while the lawsuit is ongoing.
This is not the first time that US Airways pilots have been involved in a legal battle over seniority integration. The pilot groups at US Airways and America West, which merged in 2005, never integrated as the “East” pilot group contested a seniority list and the “West” pilot group argued that the union did not represent it fairly.
While American pilots are working under a contract negotiated during bankruptcy, the two US Airways pilot groups, known as East and West, never had a joint contract and are working under deals that are almost a decade old.
“The reason they were never integrated was it was a cost advantage for management for US Airways,” Hummel said. “We would hate to see the same management now at American attempting to develop the same business model and generate the same record profits on the back of their employees yet again.”
If the pilot groups can’t sort out seniority integration in a timely fashion, the company could take legal action to enforce the timetable spelled out in the memo of understanding. According to that, the union needs to give American a final seniority list by Dec. 9, 2015.
Wilson remains hopeful that the three pilot contracts can be combined into one that rewards pilots for their contributions to the carrier.
“I think we will have an assimilation of the two unions into one and a joint collective bargaining agreement before the end of the year,” Wilson said.
Flight attendants working together
The flight attendants unions at American are all smiles these days.
The Association of Professional Flight Attendants, which represents American, and the Association of Flight Attendants, which represents US Airways, have already agreed on union representation and on a seniority list integration process.
Flight attendants at each airline are working under new contracts and are looking toward negotiating a new deal at the merged airline. American is also hiring hundreds of flight attendants this year.
The APFA will become the bargaining agent for all 24,000 flight attendants at American. The two groups will be integrated into one seniority list based on their date of hire for US Airways flight attendants and date of hire plus 40 days for American flight attendants. The reason for the “plus 40 days” is that the date of hire for American flight attendants does not reflect their training time. The date for US Airways attendants does.
The unions are meeting now to create a joint contract proposal and will begin meeting with company management in May to discuss a new pact. Contract talks will continue for five months, and if the two sides can’t agree on certain items, they will go to an arbiter.
“By the beginning of next year, I’m hopeful that we’ll have a joint collective bargaining agreement at the new American and we will be well on our way towards moving forward,” Holmin said. “I believe that we deserve an industry-leading agreement. The biggest deserves the best.”
A new contract must deal with economic issues such as pay rates and healthcare costs, Glading said. Attendants also want to address scheduling and quality-of-life concerns.
The union’s goal is to “achieve a joint collective bargaining agreement that is the best in the industry,” Glading said. “When the company is earning money, then everyone should reap the benefit of that.”
Mechanics seek even playing field
For mechanics, store clerks and ground workers, the work groups at each airline started 2014 in very different situations.
At the old American, workers received a new contract that included pay raises in exchange for concessions. As part of the bankruptcy process, the carrier shuttered its Alliance Airport maintenance facility, shifting work to Tulsa and to its Dallas/Fort Worth maintenance hangar.
Mechanics and ground workers at US Airways, however, have been in contract talks with management since 2011, with no progress made while Parker pursued the merger.
The IAM’s O’Donnell said some of his members haven’t had a wage increase since 1999 and are frustrated that they are making almost $2 less an hour than their counterparts at American.
“It seems like we are being forced into lower-class-type wages,” O’Donnell said.
US Airways mechanics, who work primarily at bases in Charlotte, N.C., Pittsburgh and Phoenix, asked the National Mediation Board last summer to be released from contract talks so they could strike. But they have received no indication that they will be allowed to.
“What we want is to even the playing field before we start transition talks,” said Tom Higginbotham, president of IAM District 142, which represents 4,500 US Airways mechanics. “We want a contract now. That is what our focus is.”
The IAM representatives and company management are scheduled to meet with federal mediators in Washington, D.C., this week to discuss their contract talks.
Dale Danker, president of Transport Workers Union Local 514, who represents workers at American’s maintenance base in Tulsa, said he supports the IAM’s fight for a new contract before the two unions come together.
Combining maintenance operations during a merger takes several years, Danker said. As a result, workers are unsure how many facilities the new management team at American plans to keep open over the long term.
Recently, American announced that it would move the Tulsa base and an engine overhaul facility that stayed open at Alliance to seven-day-a-week shifts to avoid layoffs at those maintenance facilities.
“All of our members are worried about job security,” Danker said.
TWU Local 591 President Gary Peterson said several workers who voted for the concessionary contract while American was in bankruptcy took buyout offers from the company. As a result, Peterson, who represents line maintenance mechanics and store clerks, said his members would like to enter joint negotiations to improve their contract once the IAM also has a new deal.
In the meantime, Peterson said, some work issues could be improved, such as adding holidays so mechanics have the same number as nonunion workers at American.
“There are things they could do, if they chose, outside of collective bargaining to at least make the workforce feel like there is going to be some difference,” Peterson said.
Unionizing the gate agents
Customer service representatives and gate agents at the new American will need to ask themselves in 2014 whether they want to unionize.
The 6,100 employees in those work groups at US Airways are represented by an alliance of IBT-CWA. The 9,700 passenger service agents at American are not.
Last year, the CWA tried to organize American’s passenger service agents, but a union representation election failed by 150 votes, with 3,052 opposed. Although not all the agents at American voted, the CWA failed to obtain a majority of those who did.
In a merger, the unionized group will have to seek to become the representative for all the workers. For the National Mediation Board to set a representation vote, the CWA will have to collect authorization cards from over 50 percent of the more than 15,000 customer service representatives and gate agents.
The union is now conducting a card campaign, and there is no time limit for turning the cards in to the mediation board.
“The agents are working toward an election, but we don’t know when yet,” CWA spokeswoman Candice Johnson said. “We hope it will be this year.”
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