Negotiation Rumors
09-29-2016, 06:36 PM
#41
Gets Weekends Off
Joined APC: Aug 2008
Posts: 440
In my business too, I do not perform services for free or give away free work. My performance, reputation and quality of work is the only thing I give out for the price I demand. I am a capitalist. Unfortunately, in a Union, I have deadbeats that I have to support because they are willing to work for deep discounts and quality of life trades. Like I said, In this business, the majority wins.
TEN
TEN
09-29-2016, 08:20 PM
#43
New Hire
Joined APC: Sep 2016
Posts: 1
Council 20 / DTW Special Update
September 28th, 2016
Negotiations Update.
The MEC met last week, September 19-23, for a regular MEC meeting. We spent a considerable portion of the meeting discussing management’s recent inadequate negotiating offer, as well as developing the MEC’s short and longer term negotiations plan. See Negotiators' Notepad 16-13 to review management’s most recent (September 9) public position in more detail.
Cut to the Chase.
· Recent mediated negotiating sessions have left us a considerable distance apart on key value and compensation issues despite large moves by ALPA / the MEC.
· Minor moves made relative to management’s initial re-engagement proposal earlier this year that still include profit sharing (PS) and the associated retirement (DC) reductions, and management equity distributions / awards “off the top” reducing the pilots’ share of the PS.
· The MEC CH and Negotiating Committee cited management intransigence as the primary reason for the lack of progress. They also cited what they believed to be lack of allowed latitude from the MEC as a potential hindrance to their effort.
· The MEC CH and NC were reluctant to engage in further mediated negotiations without more bargaining latitude.
· The MEC had a choice to stay with the existing direction and allow for increased SPSC activity as well as eventual staffing pressures to have an effect or revise direction with increased NC latitude.
· The MEC worked more than 15 hours during the meeting and many more during the evenings in smaller groups to attempt to reach a bottom line consensus that we could all agree upon where no further latitude would be given and where all would be fully committed to the increased full range of legal SPSC (Strike Committee) activities if an agreement wasn’t reached.
· Ultimately a unanimous decision couldn’t be reached about absolute bottom line MEC direction.
· We (C20 reps) believed that the previous direction that we had agreed upon at the end of August was solid and achievable. All of the high value parameters in that direction came from a list of possible recommendation options from the Negotiating Committee (some lower value “clean up” issues / AIPs weren’t).
· However, after considering the options, briefings by the Negotiating Committee and MEC CH, after the long discussions, debate, and difficult consideration of all the (sometimes divergent) pilot perspectives and input that we represent, we helped to craft and agreed to the updated direction with its wider latitude and hard bottom line limits.
· We believed that it was better to set parameters to potentially better facilitate either getting a deal or making it clear that one can’t be reached under the current circumstances sooner rather than later.
· The MEC CH and the Negotiating Committee certainly now have enough “rope” to close the deal or prove that management isn’t serious.
· Note that the much rumored direction posted on Social Media (SM) understates that direction as well as including other incorrect information about how the details interact. (Management readers should clearly understand that too before making incorrect assumptions about what the MEC will accept).
What Next?
· The MEC CH, the Negotiating Committee and other support are in Washington, DC this week to resume negotiations with management.
· They could reach a deal in the near term if management is willing.
· If not, we could recess again for some period of time or be “parked” by the NMB.
· Without a deal:
o We will use the full spectrum of resources and options legally available to pursue achieving what we already believe is on the lower end of what is acceptable, or
o Completely “fall back”, reprioritize our goals and wait for either staffing pressure to mount (retirements and recruitment) or a release to “self-help” by the NMB after exhausting the RLA process.
Path to “No Deal”.
· Management insisting upon changes to PS of any kind, especially senior management’s need for the “[Company] Officers eat first” management equity adjustment to PS.
· NOT agreeing to full retro for 2016 up to DOS.
· Management choosing to believe or listen to those in the pilot group who say what they prefer to hear about what the group will take rather than what the MEC CH and Negotiating Committee are offering through the MEC’s direction. This includes Social Media rumors.
· Management not believing or pressing for something outside the minimum agreement parameters just set.
· Management miscalculating the market and failing to grasp the significance of all recent agreements, for passenger and cargo airlines, both on pattern bargaining and expectations as well as recruitment.
Comparisons and Perspectives used in evaluating the options.
· The key pay-related developments resulting from all negotiations ending with the NMB mediated negotiating sessions on September 6th – 9th:
o ALPA’s position reduced from 22/7/7 % raises DOS (Date of Signing) and two subsequent anniversary dates, to 19/5/5% (3-year deal), no changes to Profit Sharing (PS) and full retroactive pay to January 1, 2016.
o Management’s position has changed relative to last year’s TA from 14.5 (Jan 1, 2016)/3/3% with PS offsets worth approximately 6% W2 to 16.5/3/3/3 at DOS (4-year deal) with no commitment on retro to January 1, 2016, 50% DC on the PS and maintaining the PTIX formula changes where the management equity (stock) costs are essentially taken “off the top” before all employees’ PS is calculated. These PS changes offset conservatively 3-3.5% W2 value.
o The Negotiating Committee presenting a detailed, comprehensive proposal to management.
o Management’s team taking over 48 hours to respond with only minor moves and with the senior executive on the management team departing early on the second day.
· The difference between our existing pay rates and the maximum differential with the current UAL pay rates (764/330) = 19% now, increasing to 22.4% on 1/1/17 and to 24.8% 1/1/18. The current weighted average is 14.5%. The difference is due to the UAL pilots’ pay banding and 764 aircraft and larger being “banded” in the highest rate band at UAL currently in use. Though we pressed for a banding solution at Delta, the MEC was not willing to consider it. Note that the UAL pilots will get a snap up raise for increases that we achieve using the weighting at the time on or before 1/1/18.
· While we can plot a tortured path to making a positive UPS comparison, it’s difficult to credibly get there due to their single pay rate per seat structure and what the correct aircraft position comparators are as well the UPS pilots’ contract value per pilot being significantly greater than ours (well beyond the per pilot value of even our re-opener). Management would argue that their high amount of credit time due to the nature of their operation makes a comparison unreasonable. Of course when management thought last year that their long period in negotiations without a deal made them a viable comparison, they didn’t hesitate to push their “lack of success”, even while disregarding the fact that the UPS pilots didn’t endure the contract evisceration of the bankruptcy experience.
· The above also applies to FDX to a lesser extent.
· DAL C2K negotiated rates from 2004 are still 17.6% higher than current rates in the still existing common aircraft and positions. This number is not adjusted for inflation.
Closing Perspective.
· We believe that the company is not serious about compensating the pilot group in a manner reflective of the position senior Delta management takes in the media. Their table position continues to include profit sharing carve-outs, unwillingness to address key PWA Sections, and most importantly, overall valuation that is simply too low for membership ratification.
· The particularly odious part of Management’s proposal is the removal of the “add-back” for the equity based Management Incentive Plan (MIP) from the PTIX calculation of our profit sharing payout. This just seems really difficult to defend from a “PR” standpoint.
· We believe that this entire process may have been a “slow roll” by management to drag things out and attempt to induce “negotiations fatigue” in the pilot group.
· The polling of the pilot group has been continuing since the resumption of negotiations, and the objective data indicates that the pilot group has high expectations for this agreement. There are some who would perform “interpretive dance therapy” with the polling data, so it’s important to understand that there is “objective data” and data subject to, ah, “massaging”. (Not all of the interpretation of the data can necessarily be characterized as objective, and doesn’t minimize the high expectations of the pilot group.).
· Management’s table position is woefully short of what is indicated as what the pilots would find “ratifiable”, let alone “strongly ratifiable”.
· It’s time for Delta management to reward its pilots appropriately. We gave during bankruptcy and continue to provide a superior operational product. By many metrics we are currently providing our services at a significant discount in the marketplace.
· If they are truly interested in providing “industry leading pay, work rules and benefits”, then it is time for them to Get Serious.
· The Company may be so far invested into “believing its own press” that management is finding it difficult to adjust.
· Frankly, we strongly suspect that is the case and that the round of negotiations re-initiated this week will not lead to a deal.
· We believe that the whole MEC is now prepared to go down the long(er) road and take the fight to management as necessary.
· We believe that the direction that the Negotiating Committee has from the MEC is (beyond) reasonable, defensible, and justifiable from both economic and market perspectives.
· Considering the billions being spent annually on stock buy-backs and investor returns, not to mention fuel hedging losses, bridging the gap in our negotiating positions that’s a small fraction of the money being shoveled out the door and not being spent on the operation should be the preferred path over trying to squeeze us for every last nickel.
· Now is the time for management to seize the opportunity to show that there truly is a “difference” here at Delta.
Fraternally,
Bill, Rich, and Tom
Tom's / Secretary Treasurer’s Perspective.
I believe this update is "spot on" but I wanted to relay to our membership how, like many of you, I am angry and frustrated over management's disingenuousness and cavalier approach to negotiations. Like you, I am tired of hearing how great Delta is, how management believes in its employees and supports them only to drag this process out for as long as they have. We have seen United, UPS, FedEX, American and Southwest with contracts. We are supposed to be the best airline in the world (which I truly believe) but management isn't willing to give us the best contract?! To me it's pretty basic, take the best of all the competitors’ contracts and make us superior in every area. Unfortunately, management does not subscribe to this theory and instead wants to pad their pockets even more so by taking as much from us as possible. This is total BS and I personally will never go along with anything less than the very best for the Delta Pilots. I have a little under 4 years remaining of my 34-year career and I will NOT settle for second best. The company played us in order to drag negotiations out, trying to not pay us a few extra dollars relative to the billions shoveled out the door in an unsuccessful effort to raise the stock price, yet the pilots have remained professional and have been very patient throughout this lengthy process. The MEC has just put forth a great offer that is fair and equitable. If management continues to be unreasonable and returns with another totally ridiculous counter, then I look for the MEC to call for drastic and aggressive measures allowed under RLA Section 6 and the mediated NMB process. WE deserve better! Management has long forgotten the sacrifices pilots have made in order for this company to survive and thrive. Management NEVER made the types of sacrifices that the pilots and other employees did! They kept making the mega salaries, huge bonuses and have been given an unbelievable number of stock options, while the rest of us lost our pensions, watched our 401Ks tank and were forced to take major concessions. I cannot believe that in this time of unprecedented economic prosperity, financial growth and stability, not to mention the paying off of the disastrous gambling debt (fuel hedging), plus stock buybacks, awarding significant management raises (just to mention a few) that management refuses to give us, the Delta Pilots, the contract we so rightfully deserve! The time is NOW!
September 28th, 2016
Negotiations Update.
The MEC met last week, September 19-23, for a regular MEC meeting. We spent a considerable portion of the meeting discussing management’s recent inadequate negotiating offer, as well as developing the MEC’s short and longer term negotiations plan. See Negotiators' Notepad 16-13 to review management’s most recent (September 9) public position in more detail.
Cut to the Chase.
· Recent mediated negotiating sessions have left us a considerable distance apart on key value and compensation issues despite large moves by ALPA / the MEC.
· Minor moves made relative to management’s initial re-engagement proposal earlier this year that still include profit sharing (PS) and the associated retirement (DC) reductions, and management equity distributions / awards “off the top” reducing the pilots’ share of the PS.
· The MEC CH and Negotiating Committee cited management intransigence as the primary reason for the lack of progress. They also cited what they believed to be lack of allowed latitude from the MEC as a potential hindrance to their effort.
· The MEC CH and NC were reluctant to engage in further mediated negotiations without more bargaining latitude.
· The MEC had a choice to stay with the existing direction and allow for increased SPSC activity as well as eventual staffing pressures to have an effect or revise direction with increased NC latitude.
· The MEC worked more than 15 hours during the meeting and many more during the evenings in smaller groups to attempt to reach a bottom line consensus that we could all agree upon where no further latitude would be given and where all would be fully committed to the increased full range of legal SPSC (Strike Committee) activities if an agreement wasn’t reached.
· Ultimately a unanimous decision couldn’t be reached about absolute bottom line MEC direction.
· We (C20 reps) believed that the previous direction that we had agreed upon at the end of August was solid and achievable. All of the high value parameters in that direction came from a list of possible recommendation options from the Negotiating Committee (some lower value “clean up” issues / AIPs weren’t).
· However, after considering the options, briefings by the Negotiating Committee and MEC CH, after the long discussions, debate, and difficult consideration of all the (sometimes divergent) pilot perspectives and input that we represent, we helped to craft and agreed to the updated direction with its wider latitude and hard bottom line limits.
· We believed that it was better to set parameters to potentially better facilitate either getting a deal or making it clear that one can’t be reached under the current circumstances sooner rather than later.
· The MEC CH and the Negotiating Committee certainly now have enough “rope” to close the deal or prove that management isn’t serious.
· Note that the much rumored direction posted on Social Media (SM) understates that direction as well as including other incorrect information about how the details interact. (Management readers should clearly understand that too before making incorrect assumptions about what the MEC will accept).
What Next?
· The MEC CH, the Negotiating Committee and other support are in Washington, DC this week to resume negotiations with management.
· They could reach a deal in the near term if management is willing.
· If not, we could recess again for some period of time or be “parked” by the NMB.
· Without a deal:
o We will use the full spectrum of resources and options legally available to pursue achieving what we already believe is on the lower end of what is acceptable, or
o Completely “fall back”, reprioritize our goals and wait for either staffing pressure to mount (retirements and recruitment) or a release to “self-help” by the NMB after exhausting the RLA process.
Path to “No Deal”.
· Management insisting upon changes to PS of any kind, especially senior management’s need for the “[Company] Officers eat first” management equity adjustment to PS.
· NOT agreeing to full retro for 2016 up to DOS.
· Management choosing to believe or listen to those in the pilot group who say what they prefer to hear about what the group will take rather than what the MEC CH and Negotiating Committee are offering through the MEC’s direction. This includes Social Media rumors.
· Management not believing or pressing for something outside the minimum agreement parameters just set.
· Management miscalculating the market and failing to grasp the significance of all recent agreements, for passenger and cargo airlines, both on pattern bargaining and expectations as well as recruitment.
Comparisons and Perspectives used in evaluating the options.
· The key pay-related developments resulting from all negotiations ending with the NMB mediated negotiating sessions on September 6th – 9th:
o ALPA’s position reduced from 22/7/7 % raises DOS (Date of Signing) and two subsequent anniversary dates, to 19/5/5% (3-year deal), no changes to Profit Sharing (PS) and full retroactive pay to January 1, 2016.
o Management’s position has changed relative to last year’s TA from 14.5 (Jan 1, 2016)/3/3% with PS offsets worth approximately 6% W2 to 16.5/3/3/3 at DOS (4-year deal) with no commitment on retro to January 1, 2016, 50% DC on the PS and maintaining the PTIX formula changes where the management equity (stock) costs are essentially taken “off the top” before all employees’ PS is calculated. These PS changes offset conservatively 3-3.5% W2 value.
o The Negotiating Committee presenting a detailed, comprehensive proposal to management.
o Management’s team taking over 48 hours to respond with only minor moves and with the senior executive on the management team departing early on the second day.
· The difference between our existing pay rates and the maximum differential with the current UAL pay rates (764/330) = 19% now, increasing to 22.4% on 1/1/17 and to 24.8% 1/1/18. The current weighted average is 14.5%. The difference is due to the UAL pilots’ pay banding and 764 aircraft and larger being “banded” in the highest rate band at UAL currently in use. Though we pressed for a banding solution at Delta, the MEC was not willing to consider it. Note that the UAL pilots will get a snap up raise for increases that we achieve using the weighting at the time on or before 1/1/18.
· While we can plot a tortured path to making a positive UPS comparison, it’s difficult to credibly get there due to their single pay rate per seat structure and what the correct aircraft position comparators are as well the UPS pilots’ contract value per pilot being significantly greater than ours (well beyond the per pilot value of even our re-opener). Management would argue that their high amount of credit time due to the nature of their operation makes a comparison unreasonable. Of course when management thought last year that their long period in negotiations without a deal made them a viable comparison, they didn’t hesitate to push their “lack of success”, even while disregarding the fact that the UPS pilots didn’t endure the contract evisceration of the bankruptcy experience.
· The above also applies to FDX to a lesser extent.
· DAL C2K negotiated rates from 2004 are still 17.6% higher than current rates in the still existing common aircraft and positions. This number is not adjusted for inflation.
Closing Perspective.
· We believe that the company is not serious about compensating the pilot group in a manner reflective of the position senior Delta management takes in the media. Their table position continues to include profit sharing carve-outs, unwillingness to address key PWA Sections, and most importantly, overall valuation that is simply too low for membership ratification.
· The particularly odious part of Management’s proposal is the removal of the “add-back” for the equity based Management Incentive Plan (MIP) from the PTIX calculation of our profit sharing payout. This just seems really difficult to defend from a “PR” standpoint.
· We believe that this entire process may have been a “slow roll” by management to drag things out and attempt to induce “negotiations fatigue” in the pilot group.
· The polling of the pilot group has been continuing since the resumption of negotiations, and the objective data indicates that the pilot group has high expectations for this agreement. There are some who would perform “interpretive dance therapy” with the polling data, so it’s important to understand that there is “objective data” and data subject to, ah, “massaging”. (Not all of the interpretation of the data can necessarily be characterized as objective, and doesn’t minimize the high expectations of the pilot group.).
· Management’s table position is woefully short of what is indicated as what the pilots would find “ratifiable”, let alone “strongly ratifiable”.
· It’s time for Delta management to reward its pilots appropriately. We gave during bankruptcy and continue to provide a superior operational product. By many metrics we are currently providing our services at a significant discount in the marketplace.
· If they are truly interested in providing “industry leading pay, work rules and benefits”, then it is time for them to Get Serious.
· The Company may be so far invested into “believing its own press” that management is finding it difficult to adjust.
· Frankly, we strongly suspect that is the case and that the round of negotiations re-initiated this week will not lead to a deal.
· We believe that the whole MEC is now prepared to go down the long(er) road and take the fight to management as necessary.
· We believe that the direction that the Negotiating Committee has from the MEC is (beyond) reasonable, defensible, and justifiable from both economic and market perspectives.
· Considering the billions being spent annually on stock buy-backs and investor returns, not to mention fuel hedging losses, bridging the gap in our negotiating positions that’s a small fraction of the money being shoveled out the door and not being spent on the operation should be the preferred path over trying to squeeze us for every last nickel.
· Now is the time for management to seize the opportunity to show that there truly is a “difference” here at Delta.
Fraternally,
Bill, Rich, and Tom
Tom's / Secretary Treasurer’s Perspective.
I believe this update is "spot on" but I wanted to relay to our membership how, like many of you, I am angry and frustrated over management's disingenuousness and cavalier approach to negotiations. Like you, I am tired of hearing how great Delta is, how management believes in its employees and supports them only to drag this process out for as long as they have. We have seen United, UPS, FedEX, American and Southwest with contracts. We are supposed to be the best airline in the world (which I truly believe) but management isn't willing to give us the best contract?! To me it's pretty basic, take the best of all the competitors’ contracts and make us superior in every area. Unfortunately, management does not subscribe to this theory and instead wants to pad their pockets even more so by taking as much from us as possible. This is total BS and I personally will never go along with anything less than the very best for the Delta Pilots. I have a little under 4 years remaining of my 34-year career and I will NOT settle for second best. The company played us in order to drag negotiations out, trying to not pay us a few extra dollars relative to the billions shoveled out the door in an unsuccessful effort to raise the stock price, yet the pilots have remained professional and have been very patient throughout this lengthy process. The MEC has just put forth a great offer that is fair and equitable. If management continues to be unreasonable and returns with another totally ridiculous counter, then I look for the MEC to call for drastic and aggressive measures allowed under RLA Section 6 and the mediated NMB process. WE deserve better! Management has long forgotten the sacrifices pilots have made in order for this company to survive and thrive. Management NEVER made the types of sacrifices that the pilots and other employees did! They kept making the mega salaries, huge bonuses and have been given an unbelievable number of stock options, while the rest of us lost our pensions, watched our 401Ks tank and were forced to take major concessions. I cannot believe that in this time of unprecedented economic prosperity, financial growth and stability, not to mention the paying off of the disastrous gambling debt (fuel hedging), plus stock buybacks, awarding significant management raises (just to mention a few) that management refuses to give us, the Delta Pilots, the contract we so rightfully deserve! The time is NOW!
09-30-2016, 08:04 AM
#46
Gets Weekends Off
Joined APC: Apr 2014
Posts: 367
In my business too, I do not perform services for free or give away free work. My performance, reputation and quality of work is the only thing I give out for the price I demand. I am a capitalist. Unfortunately, in a Union, I have deadbeats that I have to support because they are willing to work for deep discounts and quality of life trades. Like I said, In this business, the majority wins.
TEN
TEN
09-30-2016, 08:08 AM
#47
Gets Weekends Off
Joined APC: Dec 2009
Position: 7ERB
Posts: 2,039
Never. Unless they pay me to.
TEN
09-30-2016, 08:08 AM
#48
Gets Weekends Off
Joined APC: Jan 2006
Posts: 762
09-30-2016, 09:18 AM
#50
Gets Weekends Off
Joined APC: May 2008
Position: VEOP Retired! 7ER A was last position
Posts: 978
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