Airline Pilot pay justification
09-22-2010, 03:23 AM
#11
Gets Weekends Off
Thread Starter
Joined APC: Oct 2009
Position: Delta M88 A ATL
Posts: 383
The landscape is changing fast as we see consolidation of regionals as well as majors. With the economy showing a positive trend, their may be an opportunity to recover lost ground in pilot contracts.
Thinking outside the box may be the new mantra, and help improve the quality of life for all pilots.
Thinking outside the box may be the new mantra, and help improve the quality of life for all pilots.
09-22-2010, 04:38 AM
#13
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Joined APC: Jun 2006
Position: A-320A
Posts: 18,563
If I could not pass the new barriers to entry I have no fear that I would not land on my feet somewhere else.
See this process starts long before the Medical Boards or Bar Exams. It starts with entry and weeding out in the process and culminates with these exams. We have some of that here, but not to the same degree.
09-22-2010, 04:42 AM
#14
Gets Weekends Off
Joined APC: Feb 2008
Posts: 19,704
Your total pilot cost calculations are a bit off. You have to add back into the numbers the amount of times a pilot gets paid and is not generating revenue. This includes credit hours, canceled flights and trips, sick time, vacation, reroutes to lower time rotations, Weather and other cancellations ect. Then you have to add in the total cost to provide reserve coverage for each flight. Then the costs for pilots on disability and retirement expenses. Your cost projections then go up quite a bit. The actual number you should use is the percent of pilot costs verses overall cost to fly a passenger from A to B. Its currently about 8 percent at Delta. So if a passenger is paying 100 dollars for a leg then 8 of its goes to the pilots.
09-22-2010, 04:42 AM
#15
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Joined APC: Jun 2006
Position: A-320A
Posts: 18,563
Great post Nerd.
Somebody brought up the seniority-based pay scales, and the ingrained "pay-your-dues" system that's plaguing the airline industry. I will also say that the problem isn't the management. The problem is the collective mentality of airline pilots in the US.
After my airline collapsed (Aloha), many of us lost everything. Nerd, imagine yourself right now, you are an experienced captain making a solid living, but due to really poor management, you find your airline collapsing and now you no longer have a job. OK, it happens to the best of us, you say. I will go and find another job. But unlike most other "professionals", you, despite most likely decades of experience in the cockpit, years as a captain making decisions, are limited to making less than $3000/month again, and that's if you're 'fortunate' enough to get hired an outfit like say Allegiant or JetBlue.
"It's not fair to have anyone off-the-street or some 'brown noser' bypass me (in terms of pay, seat, etc.) - I was here first" is the argument you'll hear from the people in any airline.
What also fosters the above argument is are the tiered payscales. Everyone rightfully wants to protect theirs. So as a result, if, God-forbid, your airline goes out of business, and you're young and 'fortunate' enough to get hired by another airline, remember, your experience, your time in the industry, your previous compensation do not matter one iota. You are still sentenced to under $3000/month.
... and what's even more shocking is that the pilot population accepts that as normal.
Do airline managers 'lose' all their years of experience when it comes to their compensation? Maybe their 'loss' is about equal to the percentage of pilots' pay cuts as parts of concessions.
The management sees this as a way to keep your wages low simply because you will have to start over somewhere else, and to many, it might be financially impossible. Just think in terms of concessions you've given over the last decade, still better than losing your seniority-protected pay, right? In the meanwhile, look at the airline executive compensation and bonuses while you were taking pay cuts and losing your pension.
Sadly, US pilot population accepts this as normal, and as long as that mentality persists among the pilot ranks, you will not exact any changes.
As a result of this, many of my former airline colleagues took jobs flying for overseas airlines where there is no 'seniority system' like in the US, where you are paid as a professional from day 1 as opposed to 10 years from now.
Unfortunately, in the US, I don't see the pilot compensation system changing without radical changes in pilots' collective way of thinking, and sadly, I think it's highly unlikely.
Somebody brought up the seniority-based pay scales, and the ingrained "pay-your-dues" system that's plaguing the airline industry. I will also say that the problem isn't the management. The problem is the collective mentality of airline pilots in the US.
After my airline collapsed (Aloha), many of us lost everything. Nerd, imagine yourself right now, you are an experienced captain making a solid living, but due to really poor management, you find your airline collapsing and now you no longer have a job. OK, it happens to the best of us, you say. I will go and find another job. But unlike most other "professionals", you, despite most likely decades of experience in the cockpit, years as a captain making decisions, are limited to making less than $3000/month again, and that's if you're 'fortunate' enough to get hired an outfit like say Allegiant or JetBlue.
"It's not fair to have anyone off-the-street or some 'brown noser' bypass me (in terms of pay, seat, etc.) - I was here first" is the argument you'll hear from the people in any airline.
What also fosters the above argument is are the tiered payscales. Everyone rightfully wants to protect theirs. So as a result, if, God-forbid, your airline goes out of business, and you're young and 'fortunate' enough to get hired by another airline, remember, your experience, your time in the industry, your previous compensation do not matter one iota. You are still sentenced to under $3000/month.
... and what's even more shocking is that the pilot population accepts that as normal.
Do airline managers 'lose' all their years of experience when it comes to their compensation? Maybe their 'loss' is about equal to the percentage of pilots' pay cuts as parts of concessions.
The management sees this as a way to keep your wages low simply because you will have to start over somewhere else, and to many, it might be financially impossible. Just think in terms of concessions you've given over the last decade, still better than losing your seniority-protected pay, right? In the meanwhile, look at the airline executive compensation and bonuses while you were taking pay cuts and losing your pension.
Sadly, US pilot population accepts this as normal, and as long as that mentality persists among the pilot ranks, you will not exact any changes.
As a result of this, many of my former airline colleagues took jobs flying for overseas airlines where there is no 'seniority system' like in the US, where you are paid as a professional from day 1 as opposed to 10 years from now.
Unfortunately, in the US, I don't see the pilot compensation system changing without radical changes in pilots' collective way of thinking, and sadly, I think it's highly unlikely.
09-22-2010, 04:44 AM
#16
Gets Weekends Off
Joined APC: Mar 2008
Posts: 2,919
I can't take credit for this great explanation of pilot pay, I copied it from another site:
In M^%$ )(***l's post about his daughter's starting attorney pay there were many comments about the sad state of pilot pay. &^% made his point about us not negotiating in a vacuum - and it's fair enough. We all should know that pilot pay is but one component of the company's overall expenses and that achieving profitability is a complex goal for management. Nevertheless, I want to address another legitimate perspective on current and future pilot pay that deserves serious attention, namely the perspective gained by considering how much each passenger actually pays the pilots who safely fly them to their destinations. Shoot me down here - or agree - that this is a legitimate perspective we should be pushing more publicly. Whatever your response is if it's thoughtful I welcome it.
I fly captain on MD-88's and MD-90's. For argument purposes let's say my average seat count is 145 passengers. I'm sure somebody has the average load factor for these narrow body aircraft, but it looked pretty high to me in 2009. If it was 80%, then the average number of passengers on board an MD-88/90 was 116.
If every passenger with this load factor directly paid me $1.30/hour that would have covered my $150/hour 2009 wage. We have various employee benefits, and credit hours that are not directly productive, so ballpark we could probably agree $.70/hour more might cover those extra costs? So if the load factor is 80% and every passenger pays the captain $2/hour (and the FO $1.50/hour), then we're talking $3.50/hour going to both pilots of an MD88/90. Our legs probably average two hours.
We should all think about this for a few moments. Passengers pay hundreds, usually many hundreds of dollars per leg to fly on our jets. If my arithmetic is accurate it means passengers pay narrow body captains and their FO's about $7 total of their fare for a typical two hour flight - a very small percentage of their ticket cost. If this is true, how is it that a minimum cost of living pilot pay raise in any economic environment hasn't been demanded by DALPA and cannot be accommodated by management? How is it that the pay cuts we endured were not defended against in such visible and defensible terms? For management to pay both an MD-88/90 captain and the FO 116 more dollars/hour each - and again cover our credit hour costs and retirement benefits - all they'd have to do is directly pass on to passengers a $3.50/hour increase in the price of their ticket. $150, plus $116, would be $266/hour for MD-88/90 captains. And over $200/hour for FO's. Now we're beginning to talk real pay and DC retirement fund restoration.
More perspective. I tip the van driver two bucks if he takes me anywhere but to an airport hotel. I tip the Sky Cap a buck a bag to check my bags and family in at the curb - four bucks for about four minutes of his life. If every passenger tipped me a buck a minute - $120 for the two hour flight - times 116 passengers - that would be $13,920 for one flight. I don't expect anyone to tip, or pay, pilots like they might tip Sky Caps, but how about another $3.50/hour as eminently reasonable?
If polled, how many passengers would complain that paying a total of $10.50 instead of the current $7 they're paying to the two pilots for their two hour trip would be an unfair burden? How many of our passengers, the overwhelming majority of whom have a nice word to say to us upon deplaning, would say we don't deserve it? How many would be shocked to hear how little of their ticket price flows to us? I know the personal investment in our piloting skill sets we've all made - the under pressure training, flying experience, sound judgment - and our unique career terminating risks from loss of medical or FAA certificate action (not to mention being the continual focus of terrorist attack) - everything we bring to the air travel experience at Delta is worth far more to the passengers than they're currently paying directly to us. I'd like to see what they pay to pilots broken out on their ticket stub, just like taxes, fuel surcharges and whatever else is listed so they can know exactly what they're paying us. I believe most passengers would agree they could and should pay their pilots more. Especially when it would take such a small increase in a ticket's price going directly to pilots to offset the historically crushing effects of inflation combined with the recent successful attacks by managements in bankruptcy to gut pilot standards of living.
There was never not a time to publicly, loudly and longly make the it's a very small percentage of your ticket price argument to the world, but the time is especially ripe now to set the stage for truly restorative pay raises in the near future - with the abusive pay and work rules at the so-called regionals getting congressional scrutiny and media coverage and people widely appreciating split second life-saving performances of major airline pilots like Sully and Skiles.
As always during my 1* years here at D%^& I'm left wondering why this argument has never been made. It hasn't been made to us by our union in rallying support for a strike vote. Its never been made to my knowledge in the public arena. How does management get away with ever (ceo, president in bankruptcy court) saying we don't merit our pay? Or get away with saying they can't pay any more - not even a small 1-2 percentage increase in an average ticket price that could flow to pilots and quickly get us back to 1987 purchasing power wages? How come %ALPA - my labor union not just my schedule with safety association - never frames the argument in such simple, easy to fathom, dollars directly paid to pilots by passengers terms? Never slaps down demonstrably hollow management claims with simple arithmetic? How about a few full page ads in USA today informing the flying pubic how little they actually pay to their pilots when management again tells us we cost too much in 2012 and restoring the profession is out of the question?
The difference between a $100,000 annual raise for all %^ pilots (about the amount we each lost since 2004) and what we're making now is less than the price of two fancy cups of coffee many of our passengers think nothing of buying before boarding a &* airplane. That, my fellow pilots, is flat out amazing to me. Pilot pay as a percentage of ticket price should inform us, our management and the flying public as we move forward to a deservedly brighter future.
In M^%$ )(***l's post about his daughter's starting attorney pay there were many comments about the sad state of pilot pay. &^% made his point about us not negotiating in a vacuum - and it's fair enough. We all should know that pilot pay is but one component of the company's overall expenses and that achieving profitability is a complex goal for management. Nevertheless, I want to address another legitimate perspective on current and future pilot pay that deserves serious attention, namely the perspective gained by considering how much each passenger actually pays the pilots who safely fly them to their destinations. Shoot me down here - or agree - that this is a legitimate perspective we should be pushing more publicly. Whatever your response is if it's thoughtful I welcome it.
I fly captain on MD-88's and MD-90's. For argument purposes let's say my average seat count is 145 passengers. I'm sure somebody has the average load factor for these narrow body aircraft, but it looked pretty high to me in 2009. If it was 80%, then the average number of passengers on board an MD-88/90 was 116.
If every passenger with this load factor directly paid me $1.30/hour that would have covered my $150/hour 2009 wage. We have various employee benefits, and credit hours that are not directly productive, so ballpark we could probably agree $.70/hour more might cover those extra costs? So if the load factor is 80% and every passenger pays the captain $2/hour (and the FO $1.50/hour), then we're talking $3.50/hour going to both pilots of an MD88/90. Our legs probably average two hours.
We should all think about this for a few moments. Passengers pay hundreds, usually many hundreds of dollars per leg to fly on our jets. If my arithmetic is accurate it means passengers pay narrow body captains and their FO's about $7 total of their fare for a typical two hour flight - a very small percentage of their ticket cost. If this is true, how is it that a minimum cost of living pilot pay raise in any economic environment hasn't been demanded by DALPA and cannot be accommodated by management? How is it that the pay cuts we endured were not defended against in such visible and defensible terms? For management to pay both an MD-88/90 captain and the FO 116 more dollars/hour each - and again cover our credit hour costs and retirement benefits - all they'd have to do is directly pass on to passengers a $3.50/hour increase in the price of their ticket. $150, plus $116, would be $266/hour for MD-88/90 captains. And over $200/hour for FO's. Now we're beginning to talk real pay and DC retirement fund restoration.
More perspective. I tip the van driver two bucks if he takes me anywhere but to an airport hotel. I tip the Sky Cap a buck a bag to check my bags and family in at the curb - four bucks for about four minutes of his life. If every passenger tipped me a buck a minute - $120 for the two hour flight - times 116 passengers - that would be $13,920 for one flight. I don't expect anyone to tip, or pay, pilots like they might tip Sky Caps, but how about another $3.50/hour as eminently reasonable?
If polled, how many passengers would complain that paying a total of $10.50 instead of the current $7 they're paying to the two pilots for their two hour trip would be an unfair burden? How many of our passengers, the overwhelming majority of whom have a nice word to say to us upon deplaning, would say we don't deserve it? How many would be shocked to hear how little of their ticket price flows to us? I know the personal investment in our piloting skill sets we've all made - the under pressure training, flying experience, sound judgment - and our unique career terminating risks from loss of medical or FAA certificate action (not to mention being the continual focus of terrorist attack) - everything we bring to the air travel experience at Delta is worth far more to the passengers than they're currently paying directly to us. I'd like to see what they pay to pilots broken out on their ticket stub, just like taxes, fuel surcharges and whatever else is listed so they can know exactly what they're paying us. I believe most passengers would agree they could and should pay their pilots more. Especially when it would take such a small increase in a ticket's price going directly to pilots to offset the historically crushing effects of inflation combined with the recent successful attacks by managements in bankruptcy to gut pilot standards of living.
There was never not a time to publicly, loudly and longly make the it's a very small percentage of your ticket price argument to the world, but the time is especially ripe now to set the stage for truly restorative pay raises in the near future - with the abusive pay and work rules at the so-called regionals getting congressional scrutiny and media coverage and people widely appreciating split second life-saving performances of major airline pilots like Sully and Skiles.
As always during my 1* years here at D%^& I'm left wondering why this argument has never been made. It hasn't been made to us by our union in rallying support for a strike vote. Its never been made to my knowledge in the public arena. How does management get away with ever (ceo, president in bankruptcy court) saying we don't merit our pay? Or get away with saying they can't pay any more - not even a small 1-2 percentage increase in an average ticket price that could flow to pilots and quickly get us back to 1987 purchasing power wages? How come %ALPA - my labor union not just my schedule with safety association - never frames the argument in such simple, easy to fathom, dollars directly paid to pilots by passengers terms? Never slaps down demonstrably hollow management claims with simple arithmetic? How about a few full page ads in USA today informing the flying pubic how little they actually pay to their pilots when management again tells us we cost too much in 2012 and restoring the profession is out of the question?
The difference between a $100,000 annual raise for all %^ pilots (about the amount we each lost since 2004) and what we're making now is less than the price of two fancy cups of coffee many of our passengers think nothing of buying before boarding a &* airplane. That, my fellow pilots, is flat out amazing to me. Pilot pay as a percentage of ticket price should inform us, our management and the flying public as we move forward to a deservedly brighter future.
I'll play devil's advocate here for a second, this entire arguing point on why we should have pay restoration can and will, if utilized during a contract negotiation, be diffused by management with ease. Management will show us all these different types of numbers, graphs, tables, and analyses to show us that other operating coasts severely eat away at the operating cost of each and every flight. They will swear to it that restoring pay or regaining anything above that will weaken the company's operating performance.
So as far as rationalizing to the company goes, they could care less. Furthermore, rationalizing to the public, they also could care less.
Most people will agree that pilots should be compensated well, but it's hard to believe that when the average person will spend about 2 hours searching for the cheapest ticket on the internet, even if it's just a few dollars cheaper. So, there you go, people really do have a problem spending a few extra dollars on a ticket.
I know this may seem like a pointless tirade, but I think there are some realities in it that we all need to cope with. I think you article brings up some good points, so don't take this post as a dismissive counterpoint.
The realities as I see it are this:
1.) We, as a Labor Union, are not managing or deciding in which direction to take the company.
2.) We, as a Labor Union, must decide to make an educated determination of what capital the company has to work with independently.
(Without ANY communication with managment)
3.) We, as a Labor Union, are the ONLY people who can decide on what are contract and compensation SHOULD BE.
4.) When approaching the negotiator's table, we should have a Narrow Range of where or compensation packages SHOULD BE. Anything below that is not even entertained for a second, period!
The minute we try to rationalize on why our pay should be more, we will get an even better rebuttal from the management side. At the end of the day, it's not our problem, just like our personal finance isn't the management's problem.
It's the equivalent of buying a car and having the car salesmen show you the invoice while pleading with you that him and his dealership is taking a hit by selling at the proposed price. My response to that is, not my problem. I should know, as a well-informed consumer, what a fair price is for the car. At the end of the day, the price of the car is set by what people are willing to pay for it.
Our contracts our only worth as much as what we are willing to fly them for. No one else will lift a finger to change that, not the flying public, not the government, and definitely not airline management.
09-22-2010, 04:57 AM
#17
Happy to be here
Joined APC: Jun 2006
Position: A-320A
Posts: 18,563
Sailing, lets not forget all of the back office support staff that allocated as pilot support. These people do not generate revenue for DAL, we do but their costs are associated with our support. (CPO, CPSC, Scheduling, OCC, Benefits Administrators etc)
09-22-2010, 05:01 AM
#18
Gets Weekends Off
Joined APC: Feb 2008
Posts: 19,704
Great idea and that is what many of those professional associations do. They limit the number of entrants.
The reasons that those two barriers are so hard is not just the test, but the predetermined number of applicants that are allowed to be certified. It is called limiting supply. It is something that we really should look at.
The reasons that those two barriers are so hard is not just the test, but the predetermined number of applicants that are allowed to be certified. It is called limiting supply. It is something that we really should look at.
A great idea, except for one small issue called the RLA. I don't believe there is any legal way to try and limit pilot numbers.
On the subject of restoration I am all for it and would love to see it. It would of course mean that pay rates at Delta would have to double from current rates and other expenses soar. A true restoration contract would move total pilot expenses at Delta from about 2.2 billion a year to 4.5 to 5 billion a year. As a senior pilot I would love to see that happen.
If however I was a junior pilot I might have a different perspective on the issue. In the time I have been in this industry airlines that have allowed their costs to get out of line with other airlines have withered on the vine. Those with a advantage have prospered. Two easy examples. AMR had a large cost advantage over other airlines from 85 to the early 90's. They grew at a rate almost never seen at a large airline. When there costs jumped up higher then other airlines that trend reversed itself. The second obvious example is SWA. Low costs gave them sustained growth year after year. Then through a odd set of circumstances they lost their historical employee cost advantage. That also ended the decades long run of consistant growth.
Delta management does not care what they pay us at Delta. They only care what they pay us relative to the competition. This is a brutally cost competitive industry. The only real path to restoration is steps taken over time that other airlines follow. We can certainly open for a restoration contract. I can tell you what will follow. Management will say, Thank you for your opener. We will present our counter off in June. We will say June is 6 months away. Thats crazy. Management will say you are mistaken. We meant June of 14 not 13. They will simply refuse to negotiate. The NMB will allow them to do this because they will view us as not negotiating in good faith. Don't think so? Look only as far as American.
I always asked those that want nothing short of full restoration to provide a plan to achieve that within the tremendous restrictions the RLA imposes on us. I have never been given a single answer to how. I have only been told wants. Big difference there.
I think the strategy that will put more money over time in my pocket and allow for continued growth for the junior pilots is to take a more pragmatic approach. We open for a contract that will be industry leading but not way out of line. We let management know that this is contingent on getting a contract done on or near the amendable date. We make some nice gains begin getting those gains quickly. We sign a short duration contract like they used to be. Hopefully 3 years but no longer then 4. That allows other airlines to hopefully leapfrog us and puts us back at the table in 2016 going for the second big bite of the apple. If we open for a restoration contract we will still be negotiating and working under the current contract in 2016 without question. Thumping our chests and demanding restoration may make us feel good but I don't see any way it puts the most money and quality of life in my families pocket.
09-22-2010, 05:37 AM
#19
At home on the maddog!
Joined APC: Mar 2009
Position: ATL MD-88A
Posts: 2,874
In the time I have been in this industry airlines that have allowed their costs to get out of line with other airlines have withered on the vine. Those with a advantage have prospered. Two easy examples. AMR had a large cost advantage over other airlines from 85 to the early 90's. They grew at a rate almost never seen at a large airline. When there costs jumped up higher then other airlines that trend reversed itself. The second obvious example is SWA. Low costs gave them sustained growth year after year. Then through a odd set of circumstances they lost their historical employee cost advantage. That also ended the decades long run of consistant growth.
09-22-2010, 06:17 AM
#20
Gets Weekends Off
Joined APC: Apr 2007
Posts: 4,674
I'm in favor of raising the standards and barriers to entry, which will reduce the number of pilots. If that means I should be eliminated, raise the standards to eliminate me. I'll just work harder and meet the higher standards, as would many others. That is GOOD for the profession as a whole.
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