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Airline Division News, Week Ending July 16, 2016

Arbitrator Issues Ruling for OneSky Pilots

After more than two years of Fence Agreement negotiations that were frustrated by management’s unreasonable positions that led to an impasse, three days of mediation/hearings were scheduled by Arbitrator Herb Fishgold. The hearing was scheduled June 28th – 30th and due to scheduling conflicts, reconvened on July 13th.

During the session, the Arbitrator held a formal on-the-record hearing during which the parties’ attorneys presented their final arguments regarding six unresolved issues. Following those presentations, the Arbitrator, speaking for the three-member System Board of Arbitration, issued a “bench” decision regarding the six issues.

The highlights of the Award are as follows:

• All current and future Flight Options (“FO”) Aircraft that are of the same make and model, including Phenom 300, and aircraft later placed on order or option by FO will be flown by FO pilots, regardless of ownership.

• Flexjet (“FJ”) Pilots who are not also active FO pilots shall not operate nor serve as pilots on FO Aircraft. Except for “Transfer Pilots,” FO and FJ shall not engage in mixed crews.

• FJ International Red Label Large Cabin Program shall be offered to both FJ and FO pilots and filled approximately 50/50 by volunteers in seniority order.

• FO pilots may voluntarily transfer in seniority order to unfilled vacancies at FJ. A new FO Transfer Pilot shall continue to accrue FO seniority and longevity while employed at FJ. He shall also accrue FJ seniority and longevity beginning on his Date of Hire (“DOH”) at FJ. Effective today, unless they would have been furloughed, FO pilots that previously transferred to FJ on PLOAs are again accruing FO longevity. All FO Transfer Pilots shall be subject to the 2010 FO CBA Sections 11 (Union Security), 12 (Equal Opportunity), 21 (Grievance Procedures), 22 (System Board of Adjustment) and 26 (Internment, Missing, Prisoner or Hostage of War) while employed at FJ. New FO Transfer Pilots shall be compensated at the higher of their pre-transfer FO rate of pay or their new FJ rate of pay.

• FJ pilots may voluntarily transfer in seniority order to unfilled vacancies at FO as long as there are no FO pilots on furlough that have not been offered recall. A new FJ Transfer Pilot shall continue to accrue FJ seniority and longevity while employed at FJ. He shall also accrue FO seniority and longevity beginning on his DOH at FO. All FJ Transfer Pilots shall be subject to the 2010 FO CBA while employed at FO, but shall be compensated at the higher of their pre-transfer FJ rate of pay or the FO 2010 CBA rate or pay.

• All FO pilots operating Phenom aircraft shall wear uniform types as required by FJ policy.

In the letter to the membership, Local 1108 President Captain Efrem Vojta said, “Fellow pilots, we have now overcome another obstacle on our way to securing a Joint Collective Bargaining Agreement (“JCBA”) by the end of November, as is required by the 2010 FO CBA. Due to the incredible support provided by the Teamsters, International and the Airline Division, we have now moved that much closer to the ultimate goal of a single pilot workforce, which is desired by both management and your Union.”

A copy of the letter to the membership may be found here:

http://teamsterair.org/sites/teamsterair.org/files/uploads/71316presidentarbitratorissuesfenceagtaward.pdf

 

DIVISION ALERT

The recent attempts to secure operating rights into the U.S. by Norwegian Air International bring back into the forefront the inherent risks that all American workers face when foreign companies seek to bring cheap labor to our shores and U.S. companies look at ways to continue to gut American workers wages, benefits and quality of life. As the U.S. Shipping industry workers learned, this is an assault on our American way of life. Today, we would like to present the first in what will be a series of information pieces to explain the threat.

What is a Flag Of Convenience (FOC) and why should you Care?

In maritime a Flag of Convenience (FOC) ship is one that carriers a flag of country other than the country of ownership. Reasons for flying an FOC vary somewhat but the big drivers are to avoid tougher labor laws and the higher associated labor costs, higher taxation and more stringent safety regulations in the shippers’ home country. FOC’s began sailing in the 1920’s but expanded greatly in the 1950’s to the present. The effect of this scheme was the loss of good jobs and bargaining power to the maritime unions, and a race to the bottom regarding pay and benefits as each shipper tries to undercut the competition. The International Transport Workers Federation (ITF) has been battling this for decades and if you would like to read more please visit this link.

How does this affect us in the airline industry you may wonder?

Currently there is an application before the DOT for a permanent foreign air carrier permit by Norwegian Air International (NAI). This subsidiary of Norwegian Air. NAI is based in Ireland to circumvent the same regulations and labor contracts the FOC shippers are currently avoiding. They plan to crew these aircraft with labor from all over the world. In essence NAI is an FOC in the air.

Imagining the downward pressure on organized labor in the worldwide aviation market, should this application prevail, is not a difficult proposition. This is not a new idea in the airlines. In 1995, United Airlines in its filings surrounding the ESOP (employee stock ownership plan) laid out a plan to essentially outsource everything. The outsourcing company was called KION and had several subsidiaries covering both above and below wing workers.

Right now, the major airlines in the United States are opposing the application, along with all of organized labor, but if NAI is successful it will lead to more of these FOC’s in the air in a similar manner to the maritime industry. If the big four set up subsidiaries in Africa, Asia and more labor friendly countries in the EU there will be a reduced need for all represented crafts in the US. Current cabotage laws and treaties protect domestic flying but once the floodgates open how long will those protections last for those left in the industry? To answer the question in the headline, the real, exceedingly alarming and ongoing threat to your livelihood and your families’ security is the reason you should care. This assertion cannot be understated.

What’s been done about this?

In December of 2013, NAI filed its application. Instantly recognizing the threat, Division Director David Bourne tasked the Albertine Enterprises to schedule meetings with the DOT to convince them to reject NAI’s application. In addition, Albertine Enterprises scheduled countless meetings with Senators and Congressmen from both sides of the aisle. These efforts paid dividends with many members of Congress contacting Secretary Fox and the White House to convince them that this application was not in the best interest of the country. As a result of these efforts, in May of 2014, Congressman DeFazio offered an amendment to the Transportation Subcommittee of Appropriations bill which suggested that DOT not use any funds to process an illegal application for a permit to allow Norwegian Airlines to service the US.

In September of 2014 the following was reported in the AD Week in Review:

Union Solidarity Paves the Way to Victory as Norwegian Air is denied Waiver

Following a Teamster online petition campaign to keep Norwegian Air International out of the U.S., the Department of Transportation has denied the low-cost carrier’s procedural application to begin transatlantic flights.

“The Teamsters Airline Division applauds the Department of Transportation’s decision to deny Norwegian Air’s application for a temporary waiver to operate in the U.S. Norwegian Air has been dubbed the ‘Wal-Mart of the Skies’ for its relentless pursuit of cheap labor, driving down standards for airline employees and passenger safety,” said Teamsters Airline Division Director Capt. David Bourne.

Unfortunately, on April 15th 2016 the DOT gave its temporary approval to NAI. But that is not the end.

As of May 2016, the Airline Division set up and participated in more than 50 meetings with Congressional offices on the NAI matter since DOT gave its temporary approval to the application. The AD was instrumental in getting Congressman LoBiondo, the Chairman of the House Aviation Subcommittee and Congressman DeFazio, the ranking member of the full Transportation and Infrastructure Committee to introduce HR 5090, a bill designed to preclude DOT from final approval of the NAI application. There are currently 85 co sponsors on the bill thus far. The AD also participated in a rally at the White House demanding that the Obama Administration turn down the NAI application. The theme of the rally was “Deny NAI.”

What can you do?

Look for further updates from the TAMC, in the Week in Review and continue to watch the IBT legislative action page as this fight continues. In the meantime, call your Senators and Congressmen and urge them to tell the DOT to reject the permanent application of NAI.

Airline Industry News

Governmental and Regulatory

The Senate has approved a bill to extend Federal Aviation Administration authorization through Sept. 30, 2017. The extension will ensure FAA operations are not interrupted while giving Congress the time it needs to continue building consensus on a comprehensive long-term FAA bill.

Airlines, Industry and Labor

Boeing celebrates it’s 100 years in aviation this week.

Air traffic control modernization will continue to be an issue facing Congress, following passage of an authorization extension for the Federal Aviation Administration, according to former Department of Transportation Secretary James Burnley. "Big ideas and big reforms take time," he said. "Right now, we're trying to run a 24-hour per day, seven-day-a-week business like a federal grant program."

UPS Airlines and the Independent Pilots Association have reached a tentative agreement

 after five years of talks. The contract, according to UPS Airlines president Brendan Canavan, "rewards our crewmembers for their outstanding contributions and contains provisions that protect UPS's ability to deliver competitive service to our global customers."

Alaska Airlines President and Chief Operating Officer Ben Minicucci of Virgin America will become CEO following the Alaska Airlines acquisition. Virgin's Peter Hunt will remain as chief financial officer for the next two years.

Major carriers are, showing intense interest in routes to Cuba with United Airlines vying to connect the US and Cuba via a Washington, DC, based route. "A lot of airlines are focusing on Florida, given the geographic ties," said United's Steve Morrissey, "but there's a strong desire for flights to Cuba from all across the country."

Delta Air Lines has announced that it will adjust its capacity on U.S.-U.K. routes by six points, adjusting to the impact on demand from a stronger dollar, after the UK’s exit from the European Union.

United Airlines has reached an agreement for Non-Prosecution with the United States Attorney’s Office for the District of New Jersey (the “USAO”) with respect to the investigation of corruption in the deal known as, “The Chairman’s Flight”, which led to the abrupt resignation of the airline’s previous CEO, Jeff Smisek.