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September 23, 2004 |
- COMPANY TO REQUEST INTERIM RELIEF
- OCTOBER 7 UNION MEETING
COMPANY REQUEST FOR INTERIM RELIEF
The Company informed AFA last night it will file a motion requesting "interim relief" under Section 1113 (e) of the Bankruptcy code on Friday September 24, 2004. The Court will schedule a hearing and hear from the Company and AFA regarding the motion. The motion asks the following of the Court:
Rates of Pay: Base rates of pay will be reduced by twenty-three percent (23%) and frozen at the reduced level for all longevity steps (excluding MDA).
Minimum Aircraft: The provisions of the January 2003 Restructuring Agreement regarding Minimum Aircraft (including the daily utilization rate measured monthly) will not apply.
Monthly Obligation: The VP of Inflight may for each month, at any time prior to or during such month, increase the monthly obligation for all flight attendants in a given base by either five (5) or ten (10) hours (or by one (1) additional trip for flight attendants in the ITD); provided, however, that such establishment of a revised monthly pay obligation will not result in furloughs, but would be used to balance staffing in the event of attrition or staffing shortages that might disrupt flight operations.
The law requires some proof. The statute says any relief sought must be "essential" for the continued operation of the Company. The Company claims that due to high fuel prices and lower than expected revenue this relief is essential. Section 1113(e) of the code provides for interim relief. The interim period asked for is:
Duration: This agreement will expire upon the earlier of the first pay period following: (x) March 31, 2005; or (y) the effective date of a ratified Transformation Plan Letter of Agreement, or (z) the implementation of permanent relief under Section 1113(c) of the Bankruptcy Code.
The Company maintains that high fuel prices and lower revenue are draining its available funds. US Airways is spending the ATSB's money right now and there is a limit to its availability. We maintain that a 23% pay cut is excessive and overly burdensome to our members. I have copied a letter I sent to Mr. Lakefield and senior management last night.
Gentlemen:
I am in receipt of your letter to Perry Hayes regarding the Company's notice to AFA of its intention to seek relief under Section 1113(e) of the Bankruptcy code. I have also read Mr. Lakefield's Special Bulletin dated September 22, 2004. I have several comments and questions.
First, why is the request for relief limited to unionized labor? If as Mr. Lakefield states "we have a duty and an obligation to actively manage our cash and build reserves for the upcoming fall and winter period", then should not EVERYONE employed at the Company share in this "obligation"?
Secondly, Mr. Lakefield contradicts himself with regard to the TWU. He states, "We have sent to each of the unions that have not entered into a tentative agreement with the company (AFA, ALPA, CWA, IAM and TWU) a proposal for interim relief from our existing contracts, allowing us to implement immediate cost reductions, including pay cuts." In the first paragraph of the bulletin Mr. Lakefield's notes the tentative agreement reached today with the TWU dispatchers.
Thirdly, AFA has participated in negotiations with the Company. We have presented cost saving proposal to the Company. We have not delayed or been slow to provide valuations to the Company. The Company's decision to use one team to negotiate with AFA and ALPA has slowed the process. This was your choice, not ours. The three Company proposals have moved away from both our proposals and yours. In other words, you do not seem to be negotiating in good faith.
In conclusion, as you know, I became part of this process this spring. I met all of you and listened to your plan. I told you all I believed a solution based on honesty and trust could be reached. Mr. Lakefield and Mr. Ashby told the MEC in July that corporate culture and past practice at US Airways would change. I believe it has not. I believe the Company, not AFA, has brought us to this point. The Company's actions, while veiled in the guise of "protecting the Company's financial position", are designed to break the unions.
I refute the claims the unions are the cause of the bankruptcy filing and the impending motion to the court. The Company's insistence that we are the cause AND the solution, are contradictory and self serving. Sir, It is the Company's course of action that is putting ALL of our jobs at risk. While the interim relief sought may be granted, and a subsequent 1113 motion may result in contract abrogation, those changes will not be sufficient to save US Airways. Change for ALL must occur for that to happen.
The process now is this. AFA will keep negotiating with the Company in an effort to reach a tentative agreement acceptable to both parties. We will also be simultaneously negotiating with the Company regarding the 1113 (e) filing. If we are unsuccessful regarding the 1113 (e) filing, AFA attorney will argue our case at the hearing. If we are unsuccessful in reaching a tentative agreement the Company could seek a full 1113 motion to abrogate our contract. At that point both sides present their case to the court and the court can write the terms of our contract.
I realize that everyone wants to keep their job and their paycheck. If I thought that the choice was simply between that and working conditions/lifestyle I would make that recommendation. Unfortunately, the Company's last proposal indicates they want it all. I feel we must exercise every available option to save as much as we can.
In light of this news I am sure morale is going to suffer. The temptation may be to call in sick or perform poorly when working. Human nature may suggest this after all we have been through the past three years. I would like to ask that we all rise above those feelings. Please continue to be the professional group that I am proud to represent.
OCTOBER 7 UNION MEETING
There will be a Council 89 union meeting on Thursday October 7, 2004. It will be held
at the Charlotte Douglass Airport auditorium located above the Food Court. A morning meeting is scheduled from 1000am until 12 noon followed by an afternoon meeting from 200pm until 400pm. As events are changing daily, the agenda will be forthcoming.
Thank you,
MIKE FLORES
LEC PRESIDENT
COUNCIL 89
AFA-CWA AFL-CIO
704-527-0325 OFFICE
704-576-3174 CELL
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