Proposed UAL / CAL Merger to Create World’s Largest Airline
The proposed merger of United Airlines (UAL) and Continental Airlines (CAL) not only creates the potential for the largest airline in the world, it brings about the merger of unions on both properties. In a press release earlier this week, Teamster Airline Division Director David Bourne stated that, “Our most important responsibility is to ensure that the proposed Continental-United merger doesn’t harm our members. Our team of legal and financial experts has extensive experience with mergers and acquisitions and will watch this process carefully so that the interests of our mechanics and fleet service members are protected.”
Continental’s plans to close seven stations and terminate long time employees at those stations; a move announced shortly after Continental workers voted to join the Teamsters, has been cancelled. Discussions between
Proposed UAL/CAL Merger is discussed by UAL Negotiators
The Union negotiating committee met in
UPS Aircraft Mechanics Strike Major Blow against Outsourcing
Local 2727, representing UPS aircraft mechanics and related classes recently won an important arbitration victory that upholds its work jurisdiction over “A” check-type maintenance work on Boeing 767 aircraft that UPS had been outsourcing to foreign vendors when the aircraft were on layover at overseas locations. The scope protections of the UPS agreement provide that these checks; referred to as “A-checks,” are within Local 2727’s work jurisdiction and must be performed by employees covered by the agreement.
The Boeing 767, used by UPS extensively on international routes, does not have a traditional “A” or “B” letter check work package. Instead, all regularly scheduled maintenance performed between nine-day “weekend checks” and heavy maintenance “C-checks” are specified by the Boeing maintenance manual as individual tasks, each with a specified service interval, which the carrier may assemble together in any manner it deems most efficient for its operations. UPS grouped these scheduled maintenance tasks into twenty “Periodic Maintenance Checks” (PMCs), some of which required as few as two man-hours to accomplish.
The System Board rejected as meritless, the Company’s argument that Local 2727’s contract only prohibited the outsourcing of traditional “letter check” packages of scheduled work performed on the older classic aircraft like the 747-100 and DC-8. The System Board held that the Boeing 767 time/mileage defined individual maintenance tasks which UPS assembled into “PMCs” are garden-variety segmented “A” checks, expressly covered by Local 2727’s comprehensive, unambiguous work preservation language. The Board also emphatically rejected the Company’s defense that the contract’s job reservation protections were inapplicable because the work at issue was performed outside the
IBT Airline Division, Member Groups Are Key Participants at ASAP/FOQA “InfoShare”
Teamster Airline Division Aviation Safety Coordinator Captain Russ Leighton, along with Teamster mechanics from CAL and UAL, as well as several Airline Division pilot groups, recently attended the ASAP (Aviation Safety Accident Program) / FOQA (Flight Operations Quality Assurance) “InfoShare” conference in Houston, Texas. The event was attended by more than 200 airline employees representing dozens of airlines from around the world as well as many inspectors from the FAA.
A great deal of information was presented during the two-day event. One area of particular interest was a combined session for maintenance and flight programs, which included a discussion regarding problems with deferred Minimum Equipment List (MEL) items, and how these problems can cross over between maintenance and flight operations. The problem of a mechanic not properly deferring an inoperative component, or a pilot not properly operating the aircraft within the limits of the deferral, is becoming a widespread problem. One possible cause that was identified is the more complicated language for maintenance deferrals on newer generation aircraft. All participants agreed that the first critical step to finding a solution to this problem is for all parties involved to fully understand the problem and the potential for deferral before seeking a solution. Vigilance and strong communication between maintenance crews and pilots is a key step to ensure the safe operation of the aircraft.
Atlas Secures Funding for New 747-8 Freighters
Pilots of Atlas Air, members of Local 1224, are another step closer to operating the world’s most advanced freighter, the Boeing 747-8, with the recent announcement that their parent company, Atlas Air Worldwide Holdings (AAWW) has closed a $283 million revolving credit facility for the pre-delivery deposit payments on the final nine of 12 B747-8 freighters scheduled for delivery between early 2011 and 2013. Early indications from first test flights showing the aircraft will be the most efficient aircraft in the market. In addition to the twelve already scheduled for delivery, Atlas has options on fourteen additional aircraft.
AAWW, the parent company of Atlas Air and Polar Air Cargo, operate the world’s largest B747 freighters fleet. The pilot groups are continuing mediated discussions on a merged contract in preparation for arbitration over unresolved issues.
Union negotiators for Atlas and Polar pilots met in
Collective Bargaining Agreement, with tentative agreements reached on numerous subsections: Section 5 (Travel Expenses), Section 23 (Furlough and Recall), Section 24 (Filling of Vacancies), Section 25 (Scheduling) and a new section dealing with Gateway Travel.
The parties will meet for four days again in
Week In Review News Items
Labor Developments
Once again, the IAM is in the middle of an airline merger. But this time, it could find itself in conflict with other unions, rather than with airline management. In the 2008 merger between Delta and Northwest, the IAM represented 12,500 workers at Northwest, which merged with a largely non-union carrier. Nearly two years later, union elections at Delta are still pending, as the two sides continue to skirmish.
Legislative & Regulatory
The new slogan for the proposed United-Continental merger is "Let’s Fly Together." But one lawmaker not getting aboard is U.S. Rep. James Oberstar (D-Minn.), chairman of the House Transportation and Infrastructure Committee. Oberstar said on Thursday that he opposes the proposed merger, which would create the world’s biggest carrier. Oberstar is concerned that combining United and Continental could curtail competition and raise prices, the congressman’s staffers said.
Airline Industry Finances & Structure
The Delta-Northwest merger set the bar on how mergers should go – not only in gaining labor support, but in smoothly transitioning from two carriers to one…everyone is looking at American Airlines to see what it will do — if anything — as a result of the merger of Continental Airlines and United Airlines…although it is a product of four major mergers, US Airways has yet to make the one final deal to become part of one of the world's leading carriers. But that day will come, says CEO Doug Parker…the proposed merger of United and Continental airlines will adopt the United name, a stronger global brand. But that means the end of the `Proud Bird’ and the long, sometimes bitter, history of Continental Airlines.
Volcanic Ash Fallout
Ireland reopened its western airports Friday but warned that a 1,000-mile-long (1,600-kilometer-long) cloud of volcanic ash from Iceland was still lurking offshore…Germany and France demanded binding rules Tuesday to determine when air space should be closed because of volcanic ash and when planes can be allowed to fly as European Union transport ministers held another emergency meeting on aviation.
Miscellaneous
Spirit Airlines CEO Ben Baldanza sought Thursday to convince federal regulators that charging as much as $45 for certain carry-on bags is a good deal for passengers…travelers have accepted a trade-off in the do-it-yourself era: embracing the self-service technologies that airlines, hotels and car rental companies have developed in exchange for lower prices…US Airways CEO Doug Parker has consistently opposed to DOT’s new ground-delay rule. But, he also made some interesting comments – including that he thinks that — ultimately — the airlines have only themselves to blame for the new rule.