CAL Mechanics and Related Ratify New Contract
In a ballot concluded this week, CAL Mechanics and Related ratified the Tentative Agreement reached between the union and company. Of the over 83% of the membership that cast ballots, the agreement was ratified by over 73% of the membership.
Notified of the results, Airline Division Director David Bourne commented, “I want to congratulate the committee and their team for the dedication in reaching the TA, and the membership for taking the time to cast their ballot. The IBT Airline Division is proud of our Continental mechanics and the strong new agreement their solidarity allowed us to achieve. In a difficult economy, our members were able to get retroactive pay, a signing bonus, good raises, furlough protections and defined benefit pension guarantees, and to set our entire membership up for a very favorable amalgamation with our brother and sister United mechanics."
Robert Rasch, President of Local 19 and committee co-chairman noted, “This TA was the result of a combined effort of a group of very talented people, both within our Locals and the International, whose dedication to our membership was unwavering. I’m very proud to be associated with them.”
Loss by Oberstar Will Leave a Void For Labor
The loss in this week’s midterm elections by Congressman James Oberstar (D-MN) silences a long time champion of labor and airline passengers’ rights.
Oberstar, a senior member of the House of Representatives was the Chairman of the House Transportation Committee had served for 18 consecutive terms. Long seen as a champion of passenger rights and a strong friend of labor who has fought to keep airlines from outsourcing maintenance work offshore, he was also very cautious when it came to airline mergers and how they might affect passenger rights.
“In this election season where vicious, abusive attacks on elected officials who stood up for the American worker and the public became the standard; Congressman Oberstar’s defeat is a tremendous loss for Minnesota, the travelling public and American workers is profound,” said Airline Division Director David Bourne. “Congressman Oberstar’s concern for the travelling public and labor often put him at odds with management, yet he never wavered in his concern and support of the citizens of our country. The shoes he leaves behind will be very hard to fill.”
No Layoffs Planned as Gulfstream Files For Bankruptcy
Unable to yet find new lenders, Fort Lauderdale-based Gulfstream International Group has filed for protection from its creditors Thursday under Chapter 11 of the bankruptcy code.
In a filing from the company with the U.S. Bankruptcy Court for the Southern District of Florida, the company noted that Gulfstream International Airlines flights and passengers are unaffected by the bankruptcy proceedings.
While Gulfstream said it doesn't expect any layoffs as a result of the filing, they said the filing will allow them to restructure its debt and secure long-term financing. The company has petitioned the court to allow it to continue to pay wages and benefits, and any pre-bankruptcy wages to its 600 employees.
Gulfstream said it had arranged for up to $5 million in debtor-in-possession financing from Victory Park Capital Advisors, a Chicago-based alternative asset management firm. That financing is subject to court approval.
The regional airline, which operates under a code share arrangement for United and Continental Airlines, flies from Fort Lauderdale-Hollywood International Airport to Key West, Tampa, Tallahassee and the Bahamas. They also operate service from Palm Beach and Miami in South Florida and six cities out of Cleveland Ohio.
In a statement regarding the filing, Airline Division Director David Bourne said, “It is unfortunate to see yet another airline affected by bankruptcy. We are encouraged that they have taken the steps to ensure that employees will continue to be paid as they seek assistance in restructuring the company. We will closely watch events and stand ready to assist our members if requested to by the Local.”
Gulfstream’s pilots are members of Local 1224 of the Airline Division and currently in contract negotiations.
Charges of Management Interference May Lead to New Ballot for Delta Flight Attendants
Amid allegations of interference in the voting process, the National Mediation Board may likely will order a new election at Delta Airlines after reviewing allegations of company interference in balloting for union representation.
The Delta Air Lines flight attendants’ latest rejection of union representation by the Association of Flight Attendants-CWA comes after a vote in which over 18,000 of Delta’s flight attendants voted. Of those who voted, 9,544 voted against union representation and 9,216 voted in favor.
When the results were announced, the union announced that it planned to file a series of objections, including “serious charges of interference” against Delta. The union has until November 12th to file interference charges with the NMB.
While Delta’s flight attendant’s have rejected union representation twice before, in 2002 and 2008, this election is the first attempt after the merger with Northwest Airlines, whose flight attendants have been unionized for several decades.
Week In Review News Items
Labor Developments
Flight attendants at Delta rejected, by a narrow margin, a third attempt to be represented by a union. Among Delta’s nearly 20,000 flight attendants, 9,544 voted against joining the union, the Association of Flight Attendants, while 9,216 voted for a union…an appeals court in London rejected on Wednesday a case brought by British Airways cabin crew over reductions in staffing levels on flights, part of a long-running dispute between the union and airlines. The cabin crew had argued that a collective agreement which stipulated crew levels was part of their individual contracts, while the airline said those particular provisions were not included.
Legislative, Safety & Regulatory
A plane carrying 68 people crashed in a mountainous region of central Cuba after issuing an emergency call, state-run media said Thursday, and there were no initial reports of survivors. Cuban television said the plane was an ATR-72-212 twin turboprop aircraft flown by Cuba's state-owned Aero Caribbean airlines…and a small plane with at least 21 people on board chartered to international oil company ENI crashed after taking off from Pakistan's Karachi airport on Friday, killing all on board.
Qantas Airways suspended all flights of its Airbus A380 jetliners on Thursday after an engine of the super-jumbo plane exploded shortly after takeoff from Singapore, scattering pieces of debris over an Indonesian island and forcing the plane to return to Singapore for an emergency landing…and aviation safety officials warned of potential problems in Rolls-Royce jet engines less than three months before yesterday's mid-air explosion on a Qantas Airbus 380. The European Aviation Safety Authority put out an airworthiness directive on August 4 this year concerning “wear beyond engine manual limits” on the powerful Trent 900 engines fitted to Qantas's A380 aircraft. The directive said the wear could lead to “loss of engine performance with potential for in-flight shut down” and “potential unsafe conditions.”
Airlines could face pressure to put less cargo on passenger planes or improve blast protection after one of the parcels in the Yemen bomb plot was found to have flown in a passenger jet, analysts said…and while the glaring weakness of the cargo shipping system has been laid bare by the Yemen-based mail bomb plot – the cost of fixing it may be too high. Analysts warn that the cost of screening every piece of air cargo that enters the shipping system in a bid to prevent terror gangs from downing airliners might bankrupt international shipping companies, hobble the already weakened airlines, and still wouldn't provide comprehensive protection.
Airline Industry Finances & Structure
Air Canada reports net income of $261 million in the third quarter — down from $277 million last year but operating profits at the country's dominant air carrier soared…several European airlines this week followed last week's announcements of large profits from their U.S. counterparts by unveiling similarly spectacular figures for the third quarter. Details released by British Airways, Iberia and Lufthansa, among others, in their results statements implied that customers are paying higher average fares owing to a combination of more long-haul travel, a return to premium cabins and higher load factors that have pushed passengers into higher-fare buckets.
Miscellaneous
Please excuse the airline industry for applauding Rep. James Oberstar's (D., Minn) departure from Congress. As chairman of the House Transportation Committee, the 18-term Minnesota congressman was perhaps the industry's most prominent critic…and United and Delta are among U.S. carriers that will gain as Republicans scrap proposals to limit the outsourcing of maintenance work and to subject global alliances to antitrust enforcement.