The Cost of a Furlough
10-10-2020, 09:27 AM
#1
Furloughed Again?!
Thread Starter
Joined APC: Aug 2007
Position: Boeing 737
Posts: 4,804
The Cost of a Furlough
According to the company email, if we fail to come to an agreement by the end of October, they'll proceed with plans to furlough. They haven't told us how many. If they think they are able to shrink their way to cost savings though, I think it is important for SWAPA to remind them that there are significant costs associated with each furlough.
Displacements:
Under section 10 of the CBA the company is required to provide either one paid move or one night of hotel accommodations per pairing in their original line for up to 3 months.
FURTHERMORE under 10B pilots who are recalled from furlough into a base other than their last assigned are also eligible to me moved at company expense!!
Even if they only furloughed 10% of the pilots, the cascade of displacements will be astronomical. And while not all of them will choose to relocate, many will. Those costs will quickly add up.
But the bigger deal in my opinion are the recalls - MANY of whom will choose to allow the corporation to pay for relocation upon recall. We are talking 18,000 pounds, packing, unpacking, and insurance including up to 60 days storage. Plus moving expenses, vehicle shipping, meals and lodging, (1 calendar day for each 350 miles plus one day on each end of the move) - You get the idea. If you haven't looked over section 10, check it out. It'll get expensive quickly.
Furlough Pay
Under section 22E of the CBA there is a table listing furlough (severance) pay for pilots from 1 year to 10+ years of longevity.
Using myself as an example, I would be owed 3.5 bid periods at 95TFP.
At about $168 per TFP, for me it looks like this:
$168 X 95 = $15960
$15960 X 3.5 = $55860
Vacation
Under 22.A.6 the furloughed pilot will be compensated for any earned and accrued vacation. That's 26.25 TFP per week of vacation. So again using my pay rates.
($168 x 26.25) x 3 = $13230
Total Parting = $55860 +$13230 = $69090
Add in the retirement contribution = $79453
So Lets take a look at a few other years.
After completing 1 year of service
Furlough Pay: $109.56 x 95 = $10408.20
Vacation Pay: ($109.56 x 26.25) x 2 = $5751.37
Total: $16159.57
Total including B-fund: $18583.50
After completing 3 years of service
Furlough Pay: ($134.66 x 95) X 1.5 = $19189.05
Vacation Pay: ($134.66 x 26.25) x 2 = $7069.65
Total: $26258.70
Total including B-fund: $30197.50
You get the idea. So if the company hired 1000 pilots three years ago, and all of them end up being furloughed, that a $30 million dollar charge as they walk out the door. Not including 5 months of medical and other benefits under 22.A.7
Just a thought exercise to ponder when we are trying to figure out how much the company would really save during a significant furlough. There are costs as the furloughees are released, and significant costs (training, training pay, hotels, relocation, etc) upon their return.
Displacements:
Under section 10 of the CBA the company is required to provide either one paid move or one night of hotel accommodations per pairing in their original line for up to 3 months.
FURTHERMORE under 10B pilots who are recalled from furlough into a base other than their last assigned are also eligible to me moved at company expense!!
Even if they only furloughed 10% of the pilots, the cascade of displacements will be astronomical. And while not all of them will choose to relocate, many will. Those costs will quickly add up.
But the bigger deal in my opinion are the recalls - MANY of whom will choose to allow the corporation to pay for relocation upon recall. We are talking 18,000 pounds, packing, unpacking, and insurance including up to 60 days storage. Plus moving expenses, vehicle shipping, meals and lodging, (1 calendar day for each 350 miles plus one day on each end of the move) - You get the idea. If you haven't looked over section 10, check it out. It'll get expensive quickly.
Furlough Pay
Under section 22E of the CBA there is a table listing furlough (severance) pay for pilots from 1 year to 10+ years of longevity.
Using myself as an example, I would be owed 3.5 bid periods at 95TFP.
At about $168 per TFP, for me it looks like this:
$168 X 95 = $15960
$15960 X 3.5 = $55860
Vacation
Under 22.A.6 the furloughed pilot will be compensated for any earned and accrued vacation. That's 26.25 TFP per week of vacation. So again using my pay rates.
($168 x 26.25) x 3 = $13230
Total Parting = $55860 +$13230 = $69090
Add in the retirement contribution = $79453
So Lets take a look at a few other years.
After completing 1 year of service
Furlough Pay: $109.56 x 95 = $10408.20
Vacation Pay: ($109.56 x 26.25) x 2 = $5751.37
Total: $16159.57
Total including B-fund: $18583.50
After completing 3 years of service
Furlough Pay: ($134.66 x 95) X 1.5 = $19189.05
Vacation Pay: ($134.66 x 26.25) x 2 = $7069.65
Total: $26258.70
Total including B-fund: $30197.50
You get the idea. So if the company hired 1000 pilots three years ago, and all of them end up being furloughed, that a $30 million dollar charge as they walk out the door. Not including 5 months of medical and other benefits under 22.A.7
Just a thought exercise to ponder when we are trying to figure out how much the company would really save during a significant furlough. There are costs as the furloughees are released, and significant costs (training, training pay, hotels, relocation, etc) upon their return.
10-11-2020, 06:06 AM
#8
Gets Weekends Off
Joined APC: Oct 2006
Posts: 2,920
My guess: They forced non-contract employees to take a 10% cut. So to appease them they’re asking contract employees for the same.
They’ve made it clear they want more stimulus money so it’s probably more posturing to Congress that they’re serious.
Whether or not they follow through is debatable. They can send me the WARN letter....they can’t follow through til Jan 1 anyway so it gives the Union more time than the “sign here in 2 weeks or else”.
10-11-2020, 06:09 AM
#9
weekends off? Nope...
Joined APC: Apr 2014
Posts: 2,021
Both?
My guess: They forced non-contract employees to take a 10% cut. So to appease them they’re asking contract employees for the same.
They’ve made it clear they want more stimulus money so it’s probably more posturing to Congress that they’re serious.
Whether or not they follow through is debatable. They can send me the WARN letter....they can’t follow through til Jan 1 anyway so it gives the Union more time than the “sign here in 2 weeks or else”.
My guess: They forced non-contract employees to take a 10% cut. So to appease them they’re asking contract employees for the same.
They’ve made it clear they want more stimulus money so it’s probably more posturing to Congress that they’re serious.
Whether or not they follow through is debatable. They can send me the WARN letter....they can’t follow through til Jan 1 anyway so it gives the Union more time than the “sign here in 2 weeks or else”.
10-11-2020, 07:27 AM
#10
Gets Weekends Off
Joined APC: Feb 2005
Posts: 500
Hey Zap. Have you posted this on the swapa forum? I have been lurking lately but I have not seen anything like this. But then again whenever I see the ying/yang symbol or a response to the ying/yang I skip right over it. Maybe I missed this post. It's good info.
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