Negotiations Update

June 19, 2015

The parties met this week in Las Vegas. The Union worked on finalizing its comprehensive proposal on Tuesday. The work on finalizing the proposal was delayed by the announcement of the closing of JFK at the beginning of the session. After the closure announcement, the committee discussed ways to defend against the loss of positions in JFK. Several ideas were floated, and throughout the week members of the committee, along with the IBT leadership, worked with the Company to accomplish that goal. In addition, the IBT leadership is exploring all possible legal and contractual options in determining the path forward. Updates on this situation will be provided in future articles of the Dispatch.

The IBT passed a comprehensive counter proposal to the Company.  After some discussions at the table about the proposal, the Company caucused. When the parties reengaged before lunch, the mediator suggested face to face, across the table discussions regarding the remaining open items could help facilitate progress. Sub-committees were formed quickly to address items that were agreed to in principal but required clarification/amendment to reflect the understandings. Significant progress was made in these small committee meetings.   

These committees met again on Thursday and further progress was made, including more complex economic items on several Articles. TA's on the following were signed:  Article 2, Article 12, Article 13 and Article 19. These are in addition to Articles addressed and agreed to or TA’d previously during the expedited process at the start of these negotiations. Those previously TA’d articles are Articles 20 and 23, with Articles 21 and 22 agreed to in principal but requiring some minor edits or clarification.  Significant progress was also made on Article 5. If not TA’d they will be addressed during the next round of talks.  There are still some economic articles that require modification to reach agreement. These articles will be addressed in the coming sessions.  Sub-committee discussions were also held to address outstanding issues regarding health and welfare.  In addition to the Articles, two LOA’s dealing with Field Trips and Line Premiums were TA'd and an agreement in principal was reached on a station recall rights LOA. 

The positive change in the direction of negotiations was refreshing. It was agreed that due to the progress made, sub committees would continue to meet to attempt to finalize several issues prior to the next session. The next round of mediated talks will be the last week of July. At the writing of this Dispatch the location was yet to be determined. As soon as the information is available regarding the city it will be reported here.

United Maintenance Technicians send a Message to Shareholders, “Contract NOW” 

On June 10^th, over 100 UAL / IBT members gathered at Willis Tower in Chicago in a show of strength and unity to demonstrate frustration with the Company's lack of urgency in negotiating the promised industry-leading contract for United Technicians. The picketers were so loud and boisterous at 233 Wacker Drive that they could be heard in the shareholders meeting being held 10 stories above. They were so raucous that they could be heard all the way to Lake Michigan, according to reports of passersby.

Several of the demonstrators also attended the shareholders meeting. These Teamsters accounted for roughly half of the total attendees at the meeting. Several of the Teamster members in attendance asked questions of Jeff Smisek and the Board of Directors, related to the Company’s finances, governance, and operations. Canned answers were given and were of no meaningful substance. Meeting attendees believed this action by the Company showed blatant disrespect for its technician workforce. Mr. Smisek promised additional time for questions at the end of the meeting but, contrary to that promise, he and the BOD cut short the promised Q&A and unceremoniously walked out of the room to jeers from the IBT represented share owners.

The demonstration and shareholders meeting activities were coordinated; and advice given, by Carin Zalenko and Louis Malizia of the IBT Capital Strategies Division, who held a pre-rally meeting on June 9^th that lasted several hours to prepare those that would be asking questions at the shareholder meeting.

In a press release prior to the event, rank and file negotiator John Laurin, a 29-year United Airlines maintenance technician; explained the need for the protest by saying, “as employees and shareholders of this company, we have a long-term interest in the success of the airline and it’s time for management to do the right thing and offer us a well-deserved, industry-leading contract.”

“I would like to thank all those who attended the event” said Division Representative Bob Fisher. “In addition, I would like to also thank the Local Principal Officers for doing whatever it took to get their members to the event in such large numbers.”

Future activities and demonstrations are being planned and will be announced when finalized. Rank and file member cell phone videos of the June 10^th demonstration are posted at:

https://www.youtube.com/channel/UC7YF9kQqjHVjnmJJLZzuZfA

To view press coverage of this event, click the links below:

http://www.bizjournals.com/chicago/news/2015/06/10/united-airlines-mechanics-pound-the-war-drums-as.html?ana=yahoo

http://www.chicagotribune.com/business/breaking/ct-united-airlines-protest-0611-biz-20150610-story.html

http://www.marketwatch.com/story/united-airlines-maintenance-workers-warn-shareholders-of-problems-at-airline-2015-06-10

National AMT Day

Sunday May 24th is National AMT day and the TAMC and the Teamsters Airline Division would like to take a moment to recognize our thousands of Aviation Maintenance Technicians. Your hard work and dedication to aviation safety is without a doubt a corner stone in the success of our outstanding industry safety record. This day honors the birthday of Charles Taylor, the first aviation mechanic in powered flight and the man who designed and built the engine that powered the first successful Wright Brothers airplane.

On this day we should pause to remember the many men and women who have come before us. It is through their unwavering commitment to continually improve aviation safety standards that we have many of the processes and procedures in use today. As we move through our careers, we too have met the challenge of contributing our piece to improving safety as will the generations that follow us, because we are Aviation Maintenance Technicians, and that is what we do. In the hangars, on the line, in the backshops, in the blistering heat, freezing cold and the pouring rain, in the dead of night and the light of day, one thing never changes and that is our commitment to the safety of those who fly on the Aircraft we maintain. We have to get it right every time.

Thank you for all you do!

Negotiations Update

May 14, 2015

The parties assembled the week of May 11th in Las Vegas under the direction of the National Mediation Board in hope of receiving a full comprehensive proposal from the company. On Tuesday morning the Company passed their version of a comprehensive economic proposal, which was in the form of a two-page bullet point presentation. The proposal did not meet the Union Negotiation Committee’s expectations or industry benchmarks.

The Company’s bullet points addressed wages, premiums, longevity, shift differentials, vacation accrual schedules, sick accruals, holiday schedule, profit sharing, active medical plan designs as well as longer contract duration than the previous pass. Additionally, the company opened the idea of creating changes to the current retirement plan.

The Union Negotiation Committee was less than impressed, and certainly not amused, with the new tone and direction of United’s comprehensive proposal. However, continuing in good faith, the Union Negotiating Committee reviewed the terms of the proposal in caucus after the parties broke. During the caucus, the Union committee developed a series of enquiries for the Company.

On Wednesday the parties again held a face-to-face session, in which the union presented its enquiries to the Company. Once the enquiries were answered there was further discussion between the parties. After the face-to-face session, the economists from both sides met to review the economic data. The work of reviewing and determining the valuations of the Company’s proposal is ongoing.

Also on Wednesday, a discussion was held on TeamCare. Both committees along with representatives from the fund talked about ways to finalize the health care proposal. Some of what was discussed is subject to the approval by the Plan Trustees.

On Thursday the Union Negotiation Committee met internally to work on the counter proposal that should be delivered in the next round of negotiations in June.

As stated above during this week’s session, the Company changed direction and tone on key items of importance to this membership. It is still our goal to achieve an industry leading agreement and we will accept nothing less.

News from the Street
Tension is growing between airline management and workers. That's
worrisome for an industry better known for bankruptcies and failures than it
is for long-term stability.

 May 11th 2015
This week the IBT and Company committee's are reconvening under the direction of the Mediator in Las Vegas Nevada. Next weekend a report of the session will be released.
Last week John Goglia put out a report on AIN Online describing industry wide mechanic intimidation discovered in NASA reports.
Here is the link to the report
 http://www.ainonline.com/aviation-news/blogs/torqued-nasa-data-reveals-intimidation-airline-mechanics
Remember, if you get caught up in a situation like the ones described in John's report, contact your Union Representative for guidance.

UA Medical Arbitration Update May 2, 2015

A decision has been reached in the sub UA medical arbitration case. The majority decision is sustained in part and denied in part. The Board ruled that the institution of a 90-10 coinsurance violated Art 16 of the Collective Bargaining Agreement. With respect to the other increases such as co pays and out of pocket maximums the Board ruled that those elements were not in violation of Article 16. According to the decision; “The remedy is remanded to the parties for a period of 60 days, after which the remedy will be returned to the Board for resolution. The Board maintains jurisdiction of the remedy portion of this Award.” When a remedy has been agreed upon it will be reported in the Dispatch.
What this decision established was that the with the HMO’s there was a three decades old practice of not instituting, or describing a possible, split in respect to coinsurance. In writing the opinion the arbitrator found; “Thus, the language in the Agreement providing employees with an HMO option, when read together with the Company’s description of its HMO offerings, in the context of the Company’s practice over more than 30 years, persuades a majority of the Board that the Company violated Article 16.A.2. of the Agreement when it imposed 90% co-insurance as part of its HMO offerings, a change that was not in line with employee expectations.”
While it is disappointing that the out of pocket maximums were not considered protected aspects of the plan, in practice, the co-insurance would be the big reason for why a member would hit that limit. In other words the ruling on the co-insurance essentially shields most members of HMO plans from ever paying close to the out of pocket maximums. As the Board discussed; “A majority of the Board agrees that the effects of introducing co-insurance into a long-standing existing program can be significant. At worst, in the case of inpatient services, in the absence of annual out-of-pocket maximums, the financial impact on employees can be extreme. At best, with an existing annual out-of-pocket maximum cap, it is likely that more employees will be bumping up against that cap and, in some cases, chronically.”

The full decision along with the transcripts can be found here.
http://teamsterair.org/sites/teamsterair.org/files/uploads/arbtranscriptday1-3.pdf
http://teamsterair.org/sites/teamsterair.org/files/uploads/arbitrationtranscriptday2.pdf
http://teamsterair.org/sites/teamsterair.org/files/uploads/subuamedarbitrationdecision.pdf

(Please note that the court reporter made a mistake in the day one hearing and titled this hearing as between Continental and the IBT. The day two transcript is correct.)

April 22, 2015 Negotiation Update

The parties met in Fort Lauderdale during the week of April 20th as directed by the
NMB. Immediately prior to arriving in FLL, the IBT leadership was informed by the
mediator that he had directed the Company to not present a proposal this week and that
the agenda for the session would be:
1. Complete the economic analysis of IBT March proposal
2. Industry comparisons presented by each side
3. TeamCare discussion
While the Committee was extremely disappointed with the last-minute directive the
mediator gave to the Company, the Committee complied with the orders of the mediator
rather than abandon the process. The Committee’s expectation was to fully utilize the
week to anticipate and strategize for the Company’s expected next pass. It is the goal of
this Committee, with the backing of the IBT, to achieve an industry-leading contract.
In meetings with the Company, Union economist Dan Akins gave a “State of the
Industry” presentation, which includes our ranking in the industry based on our proposal
in relation to our major competitors. This corroborates and supports our current
proposal as reasonable, in-line with the industry, and one that achieves our goal of
providing an industry leading agreement.
At the close of this week’s discussions, AD Director Bourne expressed to the Company
and the Mediator that it is the Company’s turn to pass a comprehensive proposal and
that it was the IBT’s expectation that a pass would occur in the next mediated session.
The parties are next scheduled to meet in Las Vegas May 10-14th.
Current Industry Comparison
As discussed above the following slides are a representative sample of the information
that was presented to the Mediator and Company; They show that:
The pay rate trend has been positive for mechanics at Delta and American since 2012.
In 2012 United Continental mechanics led the legacy trunk carriers and only followed
Southwest as illustrated below. American and Delta mechanics have both advanced
beyond United-Continental mechanics for 2015 rates. With the single carrier status ruling
by the NMB, American-USAir mechanics will begin a six-month negotiation period, which
will culminate in arbitration if the parties at that carrier are unable to reach an
Agreement. Given recent history at American there is no reason to believe the chart
below will remain static. Since 2012 Delta mechanics received in 2013 10.2%, 2014
3.5%, and in 2015 3.3%.

 Oil prices have adjusted dramatically downward which appears to be a medium term
trend.

Airline profits have soared as a result of several factors including consolidation and
lower oil prices.

To further illustrate the industry consolidation, the following slide breaks down the
percentage of revenue in North America that each carrier controls. Note this data is from
2013 but is not expected to dramatically change anytime soon.

The rank and file negotiating committee would like to thank our economist Dan Akins for
providing the above information.

Resource Utilization Arbitration Scheduled to Continue

The Resource Utilization arbitration is scheduled to continue on June 4th in Newark. As previously reported in the December 6th Mechanics Dispatch, the company requested and received a continuation of the case due to a change in their attorney. Since that date there have been several proposed dates but this is the first date that all parties could attend. After the hearing there will be an update on the process.

Negotiations Update

On March 11th and 12th the parties met in Rosemont IL. On the 11th, the Union Negotiating Committee presented its comprehensive proposal to the Company. The proposal included the rank and file negotiating committee’s wage proposal, scope provisions, health and welfare, work rules and pension. The presentation took approximately two hours to deliver. The Company had some clarifying questions in the face-to-face session. When the face-to-face session was concluded the economists from both sides met to discuss the costing of the proposal. The Company relayed that it would have follow up questions however there were few questions that were asked over the next day’s session.
In addition to presenting Scope, H&W, Pension and Wages the Rank and File Committee agreed to close out ten previously open language items in an effort to move towards a final agreement. The Company is expected to offer a comprehensive proposal when the parties reconvene in April. The parties will meet again at the direction of the mediator April 20-24th in Fort Lauderdale, Florida.

Negotiations Update, March 1, 2015

The parties met February 23rd through the 26th in face-to-face negotiations under the direction of the NMB in Newark.  The IBT passed Article 16 – (Health and Welfare), for review.  After the IBT made the pass there was a Q and A session on the general structure of the TeamCare plan as it was proposed.  There were follow up questions throughout the week. Towards the end of the session, the Company presented a list of questions for TeamCare and the answers will be provided shortly.
On Wednesday, the rank and file committee reviewed its wage proposal from the January meeting in Houston. That analysis was then relayed to the mediator.
Direct negotiations will continue the week of March 9th in Rosemont, IL.  At that time, the full comprehensive proposal will be passed.
Tentative negotiations dates have been set in each of the following months through July and will be published here as they are firmed up.

TAMC on Capitol Hill

Members representing the TAMC were on the Hill this past week. On February 11th, TAMC Chairman Chris Moore and Bob Fisher had meetings with Matthew McCarthy, Legislative Assistant for Transportation for Senator Maria Cantwell, (D-WA) and Chris Brown, Staff Director of the House Subcommittee on Aviation.
The meetings were to continue discussions on moving the TAMC agenda on Drug Testing at Foreign Repair Stations and the Moratorium on Certification of any new Repair Stations going forward. The TAMC started the conversation on these issues in 2014 and will continue to work to have them addressed during FAA Reauthorization which is set to expire in September of 2015.
Driving the TAMC position on Drug Testing at Foreign Repair Stations is the disparity between how Drug and Alcohol testing for Safety Sensitive positions are treated differently in other countries than in the US. In the US, “No Notice” DOT testing is conducted as a deterrent to substance abuse but in many countries testing is only conducted for cause. The TAMC understands that the US cannot dictate which laws or civil liberties are in place in countries where US aircraft are maintained, but the FAA can require that US Registered Air Carriers only use vendors that conform to the same standards for testing as those within our borders.
The TAMC demand for a moratorium on New Repair Station Certifications stems from three Inspector General Reports over a ten year period criticizing the FAA for lack of oversight of Repair Stations. The TAMC first brought this to the attention of Administrator Huerta in January of 2014 and has had continuing correspondence with Associate Administrator Gilligan throughout the Spring of 2014.  The FAA maintains that the problems can be addressed through additional training for the A.S.I.s (Aviation Safety Inspectors) and the introduction of a new Safety Assurance System. While the TAMC applauds the FAA’s efforts to ensure more effective oversight, over the last decade to provide better oversight, history has proven the efforts ineffective.
Therefore in the interest of Aviation Safety, the TAMC will continue to pressure the FAA to impose a moratorium on certification of any new Repair Stations until there is proof of better oversight.
Additional information may be found at www.teamsterair.org  under the TAMC tab or at https://www.oig.dot.gov.

Negotiations Update - February 7, 2015

On February 3, the Benefits Committee convened at the offices of Cheiron in Chicago to review the TeamCare proposal. This is the proposal that was reported on in the January 17 Dispatch and was provided to the Benefits Committee that weekend. The Benefits Committee spent the previous two weeks reviewing the proposal and the corresponding plan documents. The Benefits Committee spent all day on February 3 dissecting the proposal with the help of benefits actuary Gaelle Gravot to prepare questions for the meeting with TeamCare on the February 4.
On February 4both the Benefits and the Negotiating Committees met at the offices of TeamCare in Rosemont, IL. TeamCare made a presentation to the group explaining what they could offer the group  as well as the size and health of the fund. Currently TeamCare provides insurance to close to 500,000 people and has 21.5 months of funding in reserve. What that means is that if every company in the fund stopped contributing, TeamCare would be able to provide benefits for 21.5 months. The presentation continued until lunch. After lunch, both committees asked questions of TeamCare representatives until the end of the day. It was determined that there were still questions and so both committees returned on February 5 to get more answers.
TeamCare had responses for the outstanding questions prepared for the group that morning. After receiving those answers, the Benefits Committee met with the assistance of Gaelle Gravot and attorney Ed Gleason. The committee discussed the proposal until right before lunch. Both committees then met and discussed the findings of the benefits committee. At the end of the discussion, given that the overall benefits provided were better and the cost was lower, the Benefits Committee unanimously recommended to the rank-and-file negotiating committee that they adopt the TeamCare proposal. The rank-and-file committee discussed the findings and recommendations of the benefits committee. When it appeared that all questions were asked, one of the rank-and-file committee members called for the question. The vote was taken and there was no opposition to the recommendation of the Benefit Committee. Before the proposal was adopted, a couple of committee members asked that all representatives except for the thirteen voting members recuse themselves. The thirteen members then met and again the recommendation of the Benefits Committee was overwhelmingly adopted without opposition.
Accordingly, the TeamCare proposal was added to the comprehensive proposal that will be given to mediator McGuckin on Monday the February 9.
For those members in an HMO in California, Hawaii, Denver and Chicago, TeamCare will be replicating those plans so there will be nothing new except for whatever the final cost share ends up to be. For everyone else the proposal is for a non-grandfathered plan that is similar to the MM100 plan offered by TeamCare with coverage provided mostly by Blue Cross and Blue Shield. Non-grandfathered plans are subject to regulations of the ACA so that is why there are differences from the MM100 plan. It was deemed by the committee that it would be better to move forward with the non-grandfathered plan as it provides more benefits to the membership. To see the plan documents for MM100, click here and use code MA. The committee was informed that 95 percent of all hospitals and 91 percent of doctors are in network. To see if your doctor participates, click here.
The Benefits Committee was then excused and thanked for their diligence. At that point there were several clarifying questions to Ed Gleason about the committee’s pension proposal. In the end there were no changes recommended to the pension proposal made in November of 2013.
The committee then worked towards putting the finishing touches on the comprehensive proposal. As stated above, this work is complete as of this writing and the proposal will be forwarded to mediator McGuckin on February 9. It is believed that once the mediator reviews this proposal the parties will possibly reconvene later this month.