Contents:

• Telephone Survey of Members to Begin Immediately
• Negotiating Committee Message to Members 
• Questions & Answers from the Company

Prior to negotiations, AFA usually conducts a written survey of the flight attendants. The results of that survey help develop an opening proposal to the company and provide a roadmap for the Negotiating Committee in their efforts to shape a new contract to the flight attendants' wishes. 

US Airways management has set a timeline for a resolution to our talks about sacrifices that is not reasonable, yet must be met for the airline to be considered for a loan guarantee from the federal government. 

Management says that it needs tentative agreements for sacrifices in place from all of its labor groups by June 15. AFA has made it clear to management that any agreement with the flight attendants must be put to a vote of the entire AFA US Airways membership prior to the deal being finalized. Management still insists that it needs a tentative agreement by June 15. 

This timeline has made it impossible to conduct a written survey that truly gauges the views of all flight attendants. Thus, the AFA US Airways MEC has contracted with the Wilson Center for Public Research to conduct a telephone survey of a random sample of US Airways flight attendants. Conducting a scientifically-based random poll will ensure that the elected flight attendants on the Negotiating Committee and AFA's professional negotiators and consultants work towards an agreement that protects the jobs and futures of the entire flight attendant group. 

The Wilson Center is a non-profit polling agency that does work for a number of labor unions, including ALPA. The poll is designed to provide a representatative sample of US Airways' flight attendant views on the current state of our airline and options in negotiations over sacrifices. Your Negotiating Committee will use the results of the survey as a guide in talks with the company over possible contract changes. 

Calls to US Airways flight attendants will begin immediately. If you are called please participate. Individual responses to the survey will be kept completely confidential.

Tuesday, 5-28-02 -- Today, flight attendant representatives elected to serve on the AFA Negotiating Committee, along with the attorneys, professional negotiators, and financial analysts and benefits specialists retained by AFA, met in Washington, DC to prepare for a 3:00 p.m. meeting with management. 

Your Negotiating Committee went into the meeting with a set of questions for management that need answers before we proceed with discussions over sacrifices.

Those questions asked for: 

1. Further explanation of how management is computing the costs and savings it figures to get from flight attendants (in every area, including wages and benefits, and scheduling enhancements), so that we can compare those costs to the models we develop on our own 
2. Full disclosure on the sacrifices management makes in the cost-cutting process 
3. A commitment from management that flight attendants get full credit for cost savings as they relate to flight attendant costs in deals negotiated with the pilots on regional jets and other items affected by our "Me Too" agreements that tie us to the pilots.

In the meeting, we told the company that the flight attendants do not agree that our portion of the sacrifices must equal $90 million per year. However, we will work with management to develop a package of contractual changes that protects the long-term interests of the flight attendants and that enables the airline to achieve the cost savings necessary to get the federal loan and thrive in the future. 

And while we asked questions about the many suggestions of cuts management made in our 5/21 meeting, we did not negotiate over any specific changes to our contract.

We haven't listed the cuts management suggested in our 5/21 meeting because we considered it solely a list for the sake of offering us a list. It was like management opened our contract, pulled out every section where flight attendants produce a cost to the airline, and suggested we cut it in one way or another. Management's list included cuts to: 

• Health and pension benefits 
• Vacation, sick, premium pay 
• Work rules 
• and wage concessions. 

Keep in mind that the AFA flight attendant contract remains in full force and effect. That means management cannot just make changes or unilateral cuts to our contract. Any and all changes must be negotiated for and approved of by the flight attendants in a ratification vote. You will get the final say in whether to approve the sacrifices management is requesting that the flight attendants make. 

If you have questions or suggestions for the Negotiating Committee, please email them to answers@afausairways.org or call 800-531-3242.

How is this crisis different from other financial crises the Company has faced in the past?

Simply stated, the events of September 11 changed this industry and this company forever. Business air travel is down 30% industry-wide and total industry revenue is down 15% since 2000. The terrorist attacks have had a disproportionate impact on the heart of our route structure on the East Coast, where some customers are unwilling to fly while others now drive or take the train rather than fly our short-haul routes. The result for US Airways is unprecedented and unsustainable. We are losing a record amount of money. In the past 12 months, we have lost $1.5 billion, more than twice as much as our losses in 1994 and almost five times as much as in 1991. In addition, in contrast to previous periods, US Airways has no ability to borrow and no assets left to mortgage. This issue of liquidity is why a successful application for a federally guaranteed loan is so important to us. This is a company that has seen good times and tough times over the past decade. But we have never seen a time quite like this. 

How is this plan different from those of   previous management teams? 

The major difference is that we must submit this plan to a governmental review board that will closely scrutinize our proposal before approving a federal loan guarantee. The key to our long-term survival and success is a competitive cost structure and a business plan that is sustainable. To achieve this, we are going to have to defend our franchise, preserve our assets, and grow our business in an appropriate way. This means making our services more convenient, appealing and efficient for our customers and the communities we serve. Some of the improvement will come from optimizing our hubs. A code-share alliance with a larger airline will not only boost revenue to US Airways, it will also offer more convenient travel choices and more traffic in our hub cities. Finally, another important revenue enhancement will result from additional regional jets in our system. If we improve liquidity, reduce costs and boost revenue, US Airways can once again become a strong, aggressive competitor in the eastern U.S.

Is the Company trying to fix its financial situation on the backs of Labor? 

All stakeholders in our company must participate for the effort to be successful. In restructuring this airline we must look to our workforce to make a major contribution to that effort. The simple truth is that more than half of every dollar US Airways takes in as revenue is used to pay labor costs. It makes sense that labor cost reductions are an important part of this plan. However, to obtain a loan guarantee from the government, we will have to provide a plan that generates $1.9 billion in annual cost reductions and revenue enhancements, sustainable for the seven-year period of the loan. Of that $1.9 billion, half or $950 million, will come from labor. The other half will consist of revenue enhancements and reductions in non-labor costs such as vendor concessions. We are committed to a fair process where the lowest paid employees will be the least impacted; all employees will participate, including all levels of management; the Company will try to protect the aggregate workforce levels; and employees will be able to participate in a profit sharing plan.Have you updated your profile yet?

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