gushubble

Schwartz,
Maybe you should reread my post since "almost everything" I posted was backed up by the legal jargin in INAV8OR's post after mine.

I mean no disrespect to you personally, but it would be more helpful if you would include why you think "whatever" is wrong instead. Thanks.


INAV8OR,
Thanks for your post, I'll dig into my Pilot Agreement later tonight and see if I can post what we have in ours. I'm really hoping it isn't as bad as the NW guys make it sound, cause if it is, the NW pilots wrote our contract so that they can make us their b****es. And that would suck... Big time.

INAV8OR

Well, Gus, there is more to the contract LOA. And it does favor the NWA guys a bunch. I hope it doesnt come to that, traditionally the flow throughs deals have been nothing but bad for most of the agreeing carriers. I am pretty sure that the top 10% of the compass group as well as anyone that has bypassed the flow will remain. So, by years end up to 315 compass guys could be in trouble. Again, I hope neither of us has to go through this process.

PropNWA

It is exactly as bad as it sounds. What you have to keep in mind is that the Compass contract and flow-through agreement is simply the NWA negotiators attempt at making the best of a bad bargaining position in bankruptcy. Compass was originally intended as a place for (at the time) currently furloughed NWA mainline pilots to get back to work. Subsequently, NWA recalled those furloughed pilots and it became necessary to hire off the street at Compass instead. Nobody was trying to make Compass pilots "their b***es" because there were no Compass pilots at the time. Compass was designed as job protection for NWA pilots from the start in exchange for (an unfortunate) relaxation of scope. Every single pilot hired at Compass accepted the job knowing full well that they could be bumped out by a furloughed NWA pilot. If they didn't know than that is their own fault for not reading the fine print. The information was there for anyone who wanted to know.

However, as SP92 and others have said, hopefully it will not come to that. The training costs associated with displacing the entire Compass seniority list is a huge disincentive for NWA managment to furlough.

Lighteningspeed

I agree with most of what you are saying but this is the third time I am reading that the costs of displacing pilots is a disincentive for NWA to furlough. I disagree with that assessment because NWA and other airlines have furloughed pilots despite costs. It all depends whether it would make the top management look good by cutting costs at the mainline. Costs of retraining at the Compass would not even be a consideration until after the costs saving of furloughing is measured at the mainline level. I am not saying furloughing is likely in the near future but is a real possibility in light of the latest developments at other majors.

LoudFastRules

Costs at Compass ARE costs at mainline.

Avroman

Training costs sure didn't stop all the shenanigans at Mesaba with removing the Avros before bringing on the CRJ's Look at how many more training cycles went on because of that goat rodeo.... not to mention the ones still going on with the seatlock issues for both captains and fo's

Lighteningspeed

The cost incurred at Compass to train NWA pilots who are furloughed will be attributed to Compass Airlines not to NWA. NWA does own Compass but that's not how it's done in the accounting world. The financial statement of NWA and Compass are prepared separately by respective accounting department. At any case, NWA will displace pilots at Compass even if it means incurring retraining costs. Retraining costs for 260 or more pilots would be a drop in the bucket. It would not even total up 10% of the NWA CEO and top executives received as bonuses. Like I said I believe it is all about what looks good on the NWA financial statement. Even the costs of retrainig NWA pilots to fly at Compass would be more than recouped by savings derived from cutting DC9s and A319/320 fleet and their associated costs. I am not saying NWA will furlough pilots in the near future though. If anything, NWA will probably try to retain all their pilots until after the merger with DAL. After that it's anybody's guess.

PropNWA

This has nothing to do with accounting practices. What matters is that every dollar spent on training at Compass ultimately comes out of NWA's 3 Billion cash reserve. If furloughing 300 or so pilots at NWA doesn't ultimately save more than it costs, it's not going to happen. There are a lot of variables that go into figuring out how much a furlough will cost versus what it will save. Anything that increases the cost of furloughs is a disincentive (and ultimately delays any decision to furlough) and that's exactly what the flowback does. Of course, there will come a point at which the benefits outweigh the costs but that doesn't change the fact that the flowback is a disincentive.

JungleBus

The cost of retraining NW furloughees currently on first year pay is likely to be more than if NW paid them to sit around doing nothing.

/i tell myself repeatedly as I lay awake at night

LoudFastRules

Exactly. I'm not concerned with "how accountants do it". For what it's worth, having been through a sham bankruptcy at Mesaba, and a pure leech of a holding company, I think I've got a decent handle on "how accountants do it". (Maybe there's a late night video in there somewhere, too!)

Costs at Compass are real, actual, payable in dollars costs to NWA mainline. Sure, they can dress up the paperwork, but the cash comes from mainline. I agree that they probably didn't care before, but something tells me that the pressure is high enough for them to care about large, avoidable costs now.