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ALPA - Dealing with the Devil... Again


I'm not normally one to buy into the whole one-workgroup-against-another game that a lot of folks in this industry like to play, but as I keep thinking about the reduced healthcare benefits and reduced pension plan that Delta's noncontract employees will be stuck with for the forseeable future, I can't help but theorize about the millions of other options the company would have had, had DALPA not fallen victim to the same greed demonstrated by United's pilots in the summer of 2000.

Now, I'm all for Delta pilots getting a raise after the concessions of Contract '96. However, I think the consequences of the work slowdown of the winter of 2000 and subsequent contract pale in comparison to some of the longer term effects we're going to see as a result of what Delta and ALPA agreed to.

There's reasonable and then there's ridiculous. Anybody with even a modicum of business sense should know that the contract that United and ALPA agreed to was nothing short of ridiculous. United essentially sold their soul to the devil with the ESOP of 1994. With any kind of traditional form of corporate governance thrown out the window, UAL pilots, led by the notorious Rick Dubinsky, demanded absolutely outrageous payscales, used extortion tactics and illegal work slowdowns as bargaining tools, and ultimately got what they wanted, setting an absolutely ridiculous standard of pilot compensation.

Delta ALPA officials defended their demands during Contract 2000 by arguing that they were holding Leo Mullin to his promise of "top pay for top performance," a promise he first made, incidentally, prior to UAL pilots extorting unthinkable sums of money from their company and plunging it into red ink.

It may be well to follow the "letter of the law," so to speak, and demand payscales that top United's. The summer of 2000 at United and the winter of the same year at Delta have proven that companies that fall under the Railway Labor Act have little to no recourse in situations like this. The contracts signed at United and Delta have both proven, at their respective companies, that these compensation packages are having far wider effects than anybody could ever have imagined.

Even in the current times of financial duress, ALPA has not changed its hard line stance with respect to compensation. One need only look at the details of the recent UAL/ALPA agreement:

- Contingent on all major workgroups giving UAL concessions

- Wage snapbacks in 2005, which essentially amounts to an overnight, 20% raise

- 20 million stock options guaranteed by UAL at $4, otherwise UAL agrees to make up the difference in cash

They sold their soul to the devil in 1994, and they did again this year. Rather than a good agreement to lower labor costs over the long term, this is a short term fix. The problem will still be there in 2005, if UAL is even still around by then.

And that, folks, is why I long ago wrote my senators urging them to support baseball-style arbitration.

Union leadership groups are out of control. There has to be some kind of accountability, and some reasonable standards, when it comes to labor negotiations in the airline industry. If we don't see that, it doesn't matter how hard Mr. Mullin and Co. try to make things work, or how much more they take away from one group to subsidize what another group extorts; this industry will be in a world of hurt, for a very long time to come.

 

Leo Mullins is the pseudonym of a former employee of Delta Air Lines.



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