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TRANSITION AGREEMENT DISCUSSION

The Transition Agreement between the Association of Flight Attendants at US Airways and America West and the Company was signed by the parties today.

The complete agreement is posted on our website and a written copy will be made available to each flight attendant by the company. 

The Transition Agreement remains consistent with Transition Agreements in previous mergers with regard to seniority integration and separation of the workforces during the transition period referred to as the "period of separate operations". Seniority integration will be done in accordance with the AFA merger policy of Date of Hire. As in past mergers there will be no post integration fence around any base or flying. The agreement does contain a provision for involuntarily furloughed US Airways flight attendants to accept job opportunities at America West during the period of separate operations. 

The following information will break down and clarify the agreement by section.

I. Continued Representation of the America West and US Airways Flight Attendants

The Company will continue to recognize the Association of Flight Attendants as the collective bargaining agent for the flight attendants at US Airways and America West. The Company will continue to recognize each MEC until the two MECs are merged. The MECs will merge after the completion of a ratified merged single agreement and upon operational flight attendant integration.

II. Period of Separate Operations

Section II is broken down into three parts, 1) separation of aircraft and flying between the two carriers, 2) the hiring of involuntary furloughed US Airways flight attendants at America West during the period of separate operations and 3) domicile and TDY language. 

The company will operate the two carriers separately and both collective bargaining agreements will remain in full force and effect until a merged "Single Agreement" is negotiated and ratified and operational integration occurs. 

The ALPA (pilot) Transition Agreement essentially separates the operations of America West and US Airways by the aircraft in the respective fleets of both carriers at the time of the merger and our agreement mirrors that language. The agreement does not provide for any route protection other than specified in the agreement and discussed below. US Airways flight attendants will only fly on aircraft that were in the service of US Airways at the time the merger was announced and only with US Airways pilots. The same will apply for America West flight attendants. 

The ALPA transition agreement provides for one exception to this separate flying and by virtue of our contract we will be bound to that exception as well. ALPA agreed to the following language: 

The current and announced flying, as of September 22, 2005, between points west of Mississippi River and the State of Hawaii will be flown by America West Flight Attendants. The current and announced flying, as of September 22, 2005, between points east of the Mississippi River and Europe or the Caribbean will be flown by US Airways Flight Attendants. Notwithstanding the above, up to two daily round trips to Europe, up to two daily round trips to the Caribbean, and one daily round trip to Hawaii may be flown by flight attendants of the other airline.

The meaning of this language is exactly what it says. Up to two round trips each to Europe and the Caribbean may be flown by America West crews on America West aircraft and one round trip to Hawaii may be flown by US Airways crews on US Airways aircraft. The speculation is that seasonal flying to Europe, particularly SNN, DUB or GLA could be flown by America West ETOPS 757's freeing up a larger 767 or A330 to fly a Hawaiian route. No routing decisions have been made at this time. Currently there are not enough ETOP certified aircraft at America West to take advantage of this provision but that could change. 

The airline is intending to consolidate operations under the US Airways certificate and therefore any new aircraft acquired during the period of separate operations will be flown by US Airways pilots and flight attendants. 

The second component of Section II will be the hiring of involuntarily furloughed US Airways flight attendants at America West during the period of separate operations. It is anticipated that America West will hire approximately 200 flight attendants during the remainder of 2006. Rather than hire off the street, the MEC felt very strongly those job opportunities should be offered to US Airways flight attendants on involuntary furlough. 
Involuntarily furloughed flight attendants accepting a job at America West will be considered new hire employees of America West subject to the America West collective bargaining agreement and the provisions of the Transition Agreement. Involuntary Furloughed US Airways flight attendants accepting a job opportunity at America West will be subject to the following provisions:

• As this is not a recall, those accepting a position will initially be at the bottom of the seniority list in PHX. Involuntarily furloughed US Airways flight attendants will be ranked among themselves in their order on the US Airways seniority list. Any flight attendants hired off the street will be junior to all involuntary furloughed US Airways flight attendants.
• Will be allowed to utilize his/her seniority on the combined system seniority list upon Operational Integration if they would have been offered a recall during the period of separate operations. If an involuntary furloughed flight attendant has not been offered a recall to US Airways prior to Operational Integration they will remain at the bottom of the list in PHX for bidding until offered such a recall. 
• Will be required to forego recall to US Airways for up to 365 days from the date of commencement of training. This is designed for the company not to have to hire and train additional flight attendants during the period of separate operations to replace someone recalled to the East. If a furloughed flight attendant in PHX is forced to forego a recall to an East base during this time period the recall potential will be noted and therefore he/she will be able to utilize his/her seniority upon Operational Integration.
• Will be allowed to utilize his/her US Airways longevity for pay and benefits at the America West pay rates and vacation schedule. 
• Will be eligible to participate in America West's health and welfare plans upon commencing initial qualifications training. 
• Will not be subject to a waiting period in order to participate in the America West 401(k) plan.
• Will not be required to serve a period of probation as a flight attendant for America West.
• MidAtlantic flight attendants with recall rights to US Airways will NOT be subject to the freeze/ hold provision of the Mid Atlantic flow through letter or have to forego the MidAtlantic retention bonus. 
• Involuntarily furloughed US Airways flight attendants hired by America West during the period of separate operations will be considered new hire employees of America West Airlines and will work under the America West collective bargaining agreement until a merged agreement is in effect.
• Will be required to attend America West initial new hire training in PHX and purchase uniforms. 
• Will be required to pay for lodging during initial training. (America West has never paid for new hire lodging during training) 
• Will be paid for training in accordance with the America West contract. The pay per the agreement is the greater of three (3) hours of pay per day or one (1) hour of pay for every two (2) hours on duty. 
• Will be subject to applicable background/security checks but not required to pass the America West essential functions test required of past new hires.
• Will not lose future recall rights to US Airways if a job offer at America West is declined.

Further details regarding class dates and notification procedures have just been released by the company and AFA (You can read this document HERE). We will be working with the company to locate acceptable and affordable lodging choices for those accepting a position at America West. 

It is important to note that there may be recalls to US Airways during the period of separate operations. Recalls to the East may be necessary due to projected flying, attrition and participation levels of the VFLR oversubscription offering later this year. Please weigh your options carefully when considering an offer at America West

The final component of Section II specifies that neither carrier can open a domicile or assign TDY in a domicile operated by the other carrier. Neither carrier may open or close a domicile without conferring with AFA and sharing analysis supporting a base opening or closure.

III. SINGLE CARRIER

This section requires the airlines merge into a single carrier after obtaining one operating certificate and supports the application by the Association of Flight Attendants to the National Mediation Board for recognition as the bargaining agent for one carrier.

IV. SENIORITY LIST INTEGRATION

Requires the Company to accept the seniority list compiled by the Union in accordance with AFA merger policy as contained in both contracts. As you are well aware the AFA Board of Directors reaffirmed the DATE OF HIRE merger policy at last years Board of Directors meeting. The DATE OF HIRE merger policy will be the method for seniority integration. Furthermore there will be no post integration fences around any base or flying.

As in past mergers there will be no "system flush", or global re-bid, that would allow a more senior active flight attendant to bump into a base. Vacancies will be filled according to the transfer/filling of vacancies language in the merged agreement. Both agreements contain virtually the same transfer/ filling of vacancy language at this time.

It has been agreed that flight attendants on the furlough list at the time of the seniority list integration will not be allowed to displace any active flight attendants from their jobs. 

V. Negotiation of a Collective Bargaining Agreement

The company and the Union will commence negotiations for a single agreement within 60 days of the effective date of the Transition Agreement and agree to exchange financial and operational data with 30 days of the effective date. The negotiations between the Union and the company will take place in both PHX and CLT. The joint negotiating committee is made up of USA MEC President Mike Flores, AWA MEC President Gary Richardson, committee members Carol Austin (USA) and Bill McGlashen (AWA). AFA International Staff negotiators Joe Burns (AWA) and Clare Burt (USA) will assist the committee. 

VI. Operational Flight Attendant Integration

Three things must happen in order for the company to merge; 1) a merged seniority list must be given to the company, 2) negotiation and ratification of a merged Single Agreement and 3) the company must secure a single operating certificate. Operational Flight Attendant Integration shall take place within 12 months following the later of those three items. The company is on record stating they believe they can acquire a single operating certificate by mid 2007. In order for the integration to take place the same steps must occur with the other labor groups and the company must integrate various computer and operational systems. One of the keys to this process is that the company can't integrate the flight attendants until they are given a combined seniority list. 

VII EMBRAER 190 Aircraft 

The company is in discussions with Embraer to acquire EMB 190 aircraft. The EMB 190 is a larger version of the EMB 170 and can seat up to 100 passengers in a dual configuration. As part of the ALPA Transition Agreement these aircraft, if and when acquired, will be placed within the mainline operation. As part of their agreement, ALPA agreed to a lower pay rate for the EMB 190. The pilot pay rates are equivalent to rates being paid by commuter operators of the EMB 190. The company's initial proposal to AFA was to operate the EMB at existing mainline pay rates but excluded a Senior pay premium. The America West contract does not include Senior pay for ANY aircraft and our initial response was to reject this proposal because we believed it would open the door to eliminate all Senior pay from a Single Agreement. The company's response was to exclude the entire EMB 190 proposal and reopen discussions when the aircraft was acquired under the terms of our new equipment language in our contract. On the surface that appeared acceptable, however, as the weeks went by and various industry conditions changed it was decided by the committee that might not be the best strategy. As part of their bankruptcy filing Northwest airlines has stated they are trying to create an airline within an airline and drastically reduce the pay rates for aircraft with less than 100 seats. Further analysis showed that a number of other major carriers are in talks with Embraer regarding this aircraft type. If Northwest is successful in bankruptcy and is able to create a lower pay scale based on aircraft size then other airlines could follow that lead. 

Although the company has given no indication of where this aircraft would be based it is clear that if the aircraft is acquired before the two carriers are merged they would be operated under the US Airways certificate in US Airways bases. The thought did not escape us that it would be possible for the aircraft to be based exclusively in one or more of our smaller bases potentially creating a "B" scale base/s. 

After a great deal of discussion and to alleviate the potential of a lower paying aircraft on mainline we agreed that it would be in our member's best interest to lock in the mainline rates of pay for the EMB 190 and deal with the Senior pay issue during merged contract negotiations. 

The agreement now stipulates the EMB 190 will be flown on mainline with mainline pay rates, staffed in accordance with FAR minimums and LOD/O staffing according to the respective collective bargaining agreements. 

VIII Administration of Expenses

AFA will be reimbursed for the cost of the integration of the seniority list, negotiations for a transition agreement and negotiations for a Single Agreement, printing and distribution of all agreements and all related costs to the MEC and the International staff. The amount will be limited to $400,000 and is payable after the submission and acceptance of a combined seniority list. 

America West, who previously received no Flight Pay Loss (FPL) for their MEC now begin to receive 84 hours of FPL. FPL will also be provided for 2 negotiating committee members from each group. In addition space positive travel and negotiating facilities will be provided to the union during the negotiations. 

IX Disputes as to Interpretation or Application of this Letter of Agreement

This section refers to the handling of any disputes that arise from this agreement and is straightforward in its approach.

X. Other Issues

• Effective March 1, 2006 each flight attendant group will have reciprocal jumpseat privileges on the other carrier. Flight attendants will utilize the jump seat policy and boarding priority applicable to the carrier the jumpseat is on. US Airways and MidAtlantic flight attendants may utilize an America West jumpseat at a priority immediately below America West flight attendants and vice versa.
• A uniform committee consisting of two members from each carrier will confer with the company prior to any uniform changes. This process has already begun. The USA MEC uniform committee, Candi Covelli and Brian Morgan have participated in two meetings with the company and have reported positive results from those meetings.
• Pursuant to the bankruptcy case and the elimination of labor Board of Directors seats the Board of Directors of US Airways has established a standing committee of the Board called the Labor Committee with representatives of the labor organizations. The committee will meet with the labor representatives in conjunction with the regularly scheduled Board meetings. The forum will be to discuss issues and problems but not to negotiate or interpret any issues involving the collective bargaining agreements of the labor organization. In addition to these meeting the Chairman and CEO will meet with labor representatives on a quarterly basis within one week of the company's quarterly earnings release. To date there have been two Labor Committee meetings and one quarterly meeting. All three meeting have been attended by labor representatives from both America West and US Airways. The meetings have been cordial in nature and all labor groups have stressed the need for corporate culture change and labor involvement in the company's decision making processes.
• Effective with the signing of this Transition Agreement the company will include America West flight Attendants in the US Airways profit sharing plan created by the company during the bankruptcy case. The profit sharing plan was included in our 2004 agreement and will continue in the Single Agreement.

XI. Effective date, Modifications, Status of the Letter of Agreement, and Duration

This section specifies that our contract unless otherwise noted remains in full force and effect. The agreement may be modified only by mutual consent and will remain in effect unless terminated by written agreement between AFA and the Company.

Please feel free to contact you MEC and LEC officers if you have any questions regarding the Transition Agreement.

Thank you,

Mike Flores, President
US Airways Master Executive Council

Carol Austin,
Merger Negotiating Committee Member

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AFA Local Numbers

Council 40 PIT 724-695-3329
Council 41 DCA 703-212-8090
Council 69 BOS 781-289-8454
Council 70 PHL 215-492-0840
Council 82 LGA 315-736-3483
Council 89 CLT 704-527-0325

New Hotline Number Toll Free: 866-USA-AFA2
US AIRWAYS Benefits Information 800-872-4780

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