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SWAPA update:

15 JULY 2016

1,413

DAYS SINCE CONTRACT BECAME AMENDABLE

Why We Cannot Ignore Market Gains

On Wednesday of this week, our assigned mediator notified our NC that the NMB believed it was our turn to present a comprehensive offer to the Company. With our last formal mediated sessions taking place on June 9, we were surprised by this directive. Not only are we the ones to present a counteroffer in San Antonio, but with less than a week's notice. It was also unexpected because as you know, the first, last, and only offer from Company negotiators came in early May, and was a regressive offer with a value less than the failed tentative agreement. In fact, our team dismissed their offer as not being sincere, because to do otherwise would have placed management in a very precarious position. If it was an actual offer, management was effectively telling our Pilots that they felt TA1 was more than we were worth and that they believed our market rate was lower in May than it was last August. That would have only served to antagonize our Pilots. Other than the regressive comprehensive package over two months ago, we have only received piecemeal offers on areas of the contract that management finds particularly problematic.



Most of us are aware of the gains that have been made across our industry in the last few months since the failed TA - a new United contract extension with industry-leading wages and a Delta "me-too" clause, American Airlines management unilaterally offering a profit sharing bonus plan, Allegiant's first-ever CBA with pay rates that exceed ours here at Southwest, a new UPS contract with across-the-board gains including a $300-an-hour rate at signing, Delta management's offer to its Pilots that exceeds our Platform in most metrics, and recent reports of ULCC Spirit Airlines proposing a B-Plan for its Pilots. Neither Southwest management nor the NMB can believe a regressive offer to our Pilots, in light of these market changes during a period of record profits, is a good-faith effort to reach an agreement.



In our meeting with senior management on June 7, CEO Gary Kelly said that he believed an agreement was achievable "within 30 days." With only one sincere, costed offer presented by either side, it is clear that SWAPA's Platform was the only path available to achieving his goal. With the NMB's direction to present another offer in San Antonio, we have assessed our situation and the market. With the Company's last move being away from our side, it only makes sense that we adjust our counter-offer accordingly. We recognize the authority of the National Mediation Board and the risks involved, but we cannot walk on eggshells during these negotiations. With only one successful Section 6 in the last 21 years, we have no choice but to remain committed to achieving the contract improvements that our membership requires.



The Platform was built around one fundamental concept: keeping Southwest competitive and agile. As the market has moved past us and our competitors' costs continue to rise, this only strengthens our resolve and makes the Platform even more competitive. Four months ago, we offered Southwest a fully viable solution to many of the problems that the Company team has conveyed to us. The Platform is still that solution; however, time is not on their side. Changes in the market cannot be ignored. Doing so would be a grievous mistake for both parties. A lesser agreement would simply not be ratifiable given our Pilots' evolving views on the market and our Company management.



Your BOD and your NC have heard your concerns about the continued viability of the Platform in light of the continued movement of market rates away from us. Rest assured that your SWAPA NC will present an offer above the Platform in San Antonio that captures the market changes that have occurred since it was written in January. We will make a sincere offer that the SWAPA Board of Directors has told us accurately reflects what is needed for a ratifiable agreement between Southwest Airlines and its Pilots.

ppping

We should do the same.

Doctor Dolittle

Are the mediators at different airlines allowed to have discussions with each other? In other words, are they operating in isolation and only concerned with the airline that they are assigned to or do they talk to each other and stay abreast of what's happening in the entire industry?

I'm asking because this could be huge for us. Seems to me like the NMB even understands that the table positions for the Southwest and Delta pilots are probably woefully out of date and need to be updated.

Our NC and MEC should be demanding the same leeway from our mediators that SWAPA is getting.

Purple Drank

To be fair, I think the mediators expect SWAPA to decrease their ask.

Fortunately, SWAPA has installed a chairman with vision and guts, who listens to his pilots and their representatives. He realizes the blowback from raising the offer is minimal, especially when the company needs an agreement more than the pilots do.

Malone (or should we call him maLONER) must do the same. It's not even a choice at this point.

Dat jet

I doubt that....market CLEARLY states otherwise. They have an old Northwest pilot as their mediator........

The mediator has already had to scold and cancel negotiation sessions a month or so ago, because SWA mgmt negotiators shows up one meeting not remotely prepared and had to call for break after break after asking stupid questions


Not trying to argue PD.....I value your inputs

Purple Drank

No worries, Dat. I might have interpreted SWAPA's memo incorrectly.

It would be a bombshell if the mediators were on board with an increased ask. That would be a huge win for us!

Hank Kingsley

Specifically, what has Malone done wrong? I'm not seeing it.

Dat jet

You are a great American Purple

Purple Drank

He permitted the company to repeat the NA15 playbook: "Help us with our problems, and we'll give you lots of money." Apparently, Ed led him down the primrose path on their daily phone calls. Inexcusable.

He has accepted concessions to the December counterproposal, and until this last meeting, the MEC had pretty much no idea what Malone and the NC had agreed to. That kind of news does not improve with age.

Even if he somehow browbeats the MEC into approving the concessions we know are coming, there is absolutely no way he can sell it to the pilot group. Especially after promising not to sell anything to the pilot group.

He is trying to cram down concessions. Big no-no. I believe he is effectively irrelevant at this point. He simply doesn't have the tools to adapt to this environment. He thought he could change the game with a full-page newspaper ad and a slick speech/letterwriter on staff. This is no longer the time for a finesse operator and/or a one-man band. And there are way too many Moak carryovers in his administration; we needed a clean sweep.

We require a hard-nosed SOB who can rally the MEC and build a team the pilot group can unite behind. Malone is not that guy. JMO.

Hank Kingsley

You have a lot of inside information. I don't know the specific concessions you do. The problem I see. We keep switching horses, this contract will never be settled. Maybe years from now. That's not an acceptable proposition either. On this date in July, the company is flush with cash.

The last TA needed to be fixed in a few areas. The compensation needed to be increased. Unfortunately, retirement was never addressed. If you are advocating wholesale changes, as in leaving ALPA, I don't agree. Give me the name of the hard nosed SOB to lead the union.