A Leaner, Meaner ALPA
Executive Board members approve changes designed to keep the union financially strong and resilient.
By Rob Wiley, Staff Writer
Air Line Pilot, January 2004, p.14
Opening the 92nd regular Executive Board meeting in October 2003, ALPA’s president, Capt. Duane Woerth, praised the progress made in coping with more than 8,000 members on furlough and $20 million in lost dues, but he said that the work wasn’t done.
"We’ve seen more than $20 million in annual dues evaporate from our balance sheet, yet we remain in the black," he said in opening remarks to the Executive Board, meeting Oct. 21-22, 2003, in Reston, Va.
"This Executive Board has acted very responsibly in helping your officers and staff move aggressively to cut costs, adopt ‘best business practices,’ and preserve the integrity of this organization so that we can fulfill our mission statement," he said.
Capt. Woerth contrasted the current environment with the October 2000 Executive Board meeting, during which delegates were celebrating the contract signed a few months earlier with United, eagerly anticipating a new contract with Delta, and looking forward to a successful showdown with Comair management. That Board, he said, took some dramatic action to break out of years of stagnation and inertia.
"We initiated the Pilot Unity Campaign at that Board meeting," Capt. Woerth said. "And because of that, we gained 11,000 more members for our union.
"I’m pleased to report," he said, "that one of our agenda items at this meeting involves a merger with the Kittyhawk Pilots Association.
"We also started to wrestle with bilateral scope at the meeting in 2000. We finally decided to deal with the self-evident and natural friction that arises when managements pit pilot against pilot and use wedges to divide us. That work has been ongoing."
That optimism felt in October 2000 was short-lived, Capt. Woerth said, because of an unforeseen event that would prove catastrophic to the airline industry and especially to the pilot labor movement.
Capt. Woerth wasn’t referring to the terrorist attacks of Sept. 11, 2001; organized labor took its hit less than a month after that momentous Executive Board meeting.
"The event that really turned the tide against labor occurred in November 2000, when President Bush was elected," Capt. Woerth said. "He was in office for only a few weeks when he announced that no airline strikes would occur on his watch. Now, there hadn’t been a plague of airline strikes in the previous decade, but he still decided to send us a message."
Despite allowing Comair management to force its pilots to seek self-help in the form of a strike, "the effect on collective bargaining was absolutely stifling," he said. "Management totally believed, and believes, that it had the upper hand. Unions appeared to have little leverage, and that had a dramatic reversal of fortune on wages, benefits, and the power of collective bargaining."
A club to use on labor
With the subsequent disasters on Sept. 11, 2001, the Administration took even more draconian measures to subdue airline labor unions. Capt. Woerth said the Administration used the Air Transportation Stabilization Board, which Congress established to help airlines recover, to make sure that no airline could get financial aid without using the economic club to pound labor into submission.
"Congress then on Nov. 11, 2001, passed the Airline Security Act, which seemed to be once again an opportunity to convert all the necessities of airline security into the homeland defense budget paid for with general treasury money," Capt. Woerth said. "That didn’t happen. Instead, the Administration insisted that this be paid only by user fees, so the U.S. airline industry has watched another $4.5 billion a year fly out the door."
The attacks on labor didn’t stop there. Capt. Woerth said the Administration continued to erect roadblocks on pieces of legislation—pension reform and FAA reauthorization—that are critical to the airline industry and its employees.
"President Bush is the reason we don’t have a pension bill right now," Capt. Woerth said. "We have 75 co-sponsors on H.R.2719; we have more than enough people to vote for it in the House.
"After substantial effort, we got the House and Senate Finance Committees to pass a bill that has the key function on deficit-reduction contributions—and the President and his entire team have pounded on the Senate and on the House to make sure that doesn’t happen."
The FAA Reauthorization Bill has been tied up in knots because of the Administration’s insistence on an ATC privatization campaign and over cargo cabotage in Anchorage, Capt. Woerth said. He said that those struggles have destroyed the FAA budgetary process and delayed National Airspace System modernization projects for as much as 10 years.
Finally, compliance with the LM-2 expense reporting requirements that the U.S. Labor Department has promulgated could cost ALPA $30 million.
"It is the most egregious attack on unions in anybody’s memory," Capt. Woerth said. "Clearly, our union must have a vigorous political strategy if we’re going to stabilize this union. If we are going to move forward, this has to change, and we have to have a strategy to do that."
While politics can be a very personal and emotional thing, Capt. Woerth noted, any union member should understand the single, most dominant reason a union exists: jobs. All unions are 100 percent about jobs, and if the resident at 1600 Pennsylvania Avenue isn’t a union ally, jobs will be lost and unions will be run over.
"A union’s political role entails a single focus on advancing our common and professional interests," Capt. Woerth said. "That’s all we’re here for. A union endorsement is its leadership’s recommendation to the members on job-related issues only.
"I’m not asking this Board to make that endorsement today," he said, "but I am asking you to begin the political education of our members."
The Board continued the reengineering process brought on by the income shortfall by approving one amendment to the ALPA Constitution and By-Laws, enthusiastically adopting a resolution to accept a merger agreement between ALPA and the Kittyhawk Pilots Association, recommending seven additional amendments to the ALPA Administrative Manual, and approving three other resolutions. The Board voted to take no action on two agenda items.
The Executive Board recommended one amendment to ALPA’s Constitution and By-Laws dealing with large council representation.
After some Executive Board members questioned the representation needs of large councils on multi-council airlines, the Board asked the Special Representational Structure Review Committee to examine issues related to large council representation needs to determine what those needs are and how to address and implement them in an effective manner.
The Committee reported on its preliminary discussions at the May 2003 Executive Board meeting. After further review, the Committee submitted its recommendations to the October Board meeting. Those recommendations included specific amendments to ALPA’s Constitution and By-Laws to make alternative structures available to large local executive councils, if the Board of Directors approves the change by a two-thirds vote.
The Board made several changes to the ALPA Administrative Manual in the ongoing reengineering process.
"Reengineering ALPA means the use of best business practices to improve our efficiency, to maximize our financial efficiency through policies and practices, and to ensure that necessary union services are maintained," said Capt. Chris Beebe, vice- president–finance. "As part of those efforts," he said, "we are rewriting Section 60 of the Administrative Manual in an ongoing process.
"Our 2004 budget goals are to maintain a consistent level of service, to retain a motivated and professional staff, to keep ALPA financially stable, and to maintain a balanced budget," he said.
"We have had three rounds of budget cuts yielding $25 million in savings," Capt. Beebe said. "Our reengineering efforts must contribute another $1 million, and that number will start to flow from some of the issues at this meeting."
Major changes to ALPA’s Administrative Manual include amendments
• to cope with the Labor Department regulations that changed the labor management reports that ALPA and its MECs that have total receipts of $250,000 or more must submit annually—the new reporting requirements for labor organizations became effective January 1;
• to refine and clarify the use of outside consultants and custodian representatives, specifically the practice of using retired and furloughed members when other active member pilot volunteers or outside agencies cannot immediately replace the particular expertise involved;
• to clarify certain administrative practices and to bring certain policies into compliance with the Association’s current financial restructuring—these address volunteers’ use of ALPA personal computers and cell telephones, the supplemental per diem expense allowance, and use of the Herndon Conference Center or the Washington, D.C., office facilities instead of more expensive hotels;
• to further clarify language throughout the Manual dealing with the terms "airline pilot," "regional pilot," and "regional jet";
• to confirm ALPA support for the line operations safety audit, as long as it meets the stipulated 10 characteristics, and updating ALPA policy regarding video recording of simulator sessions;
• to clarify policy concerning local council newsletter standards; and
• to clarify several policies regarding voting procedures.
In other action, the Executive Board
• approved a $559,000 grant from the OCF Contingency Fund to the US Airways MEC account to help pay for a contract enforcement communications campaign to enable US Airways members to recognize and participate in an intense ALPA effort to bring management into compliance with the pilots’ working agreement;
• approved the merger agreement between ALPA and the Kittyhawk Pilots Association effective on January 1, or sooner if mutually acceptable to the KPA and ALPA;
• directed that the Executive Board receive the latest report from the Bilateral Scope Impact Committee (see "Dare Mighty Things," page 15); and
• directed that the Executive Board receive the interim report on the ALPA-sponsored health plan from the Retirement and Insurance Committee and directed the Committee to submit a final report and recommendations to the May Executive Board meeting.
After receiving and reviewing a report from ALPA’s Membership Committee on revising the ALPA Constitution and By-Laws to specifically exclude from the definition of inactive member any pilot who is involuntarily called to active military duty for a period of more than 90 days, the Board voted to take no action on that agenda item.
The Board also voted to take no action on a recommendation to interpret ALPA’s constitutional requirement, Roll Call of Delegates, at Executive Board meetings to mean "adoption of the Executive Board Credentials Committee Report."
"Dare Mighty Things"
Although financial and procedural changes related to ALPA’s reengineering took front stage at the 92nd Executive Board meeting, Board members and staff officers took time to digest a ringing call to action from the Association’s Bilateral Scope Impact Committee (BSIC).
ALPA’s president, Capt. Duane Woerth, set the table for the wakeup call in his opening remarks, noting that airline managements were committed and dedicated to a common strategy—managing their companies as brands and driving all costs, especially labor, to the lowest possible level.
"When we started the Bilateral Scope Impact Committee, we were focused on the threat of vertical integration," Capt. Woerth said. "We talked about Delta, Comair, Atlantic Coast, and Atlantic Southeast, about US Airways and Allegheny. Well, we’re still discussing vertical integration, but the race to the bottom is no longer only vertical.
"The race to the bottom is also horizontal. Airline managements are trying to roll up Pinnacle and Mesaba; they are trying to pit Comair against Atlantic Southeast; they have the Continental Express pilots wondering what management is going to do next. Having interlocking scope horizontally is just as important as having it vertically. We have to deal with both, or they are going to roll all of us up."
The BSIC and the Collective Bargaining Committee (CBC) outlined for the Executive Board the shifting struggle for systemwide scope protection. The 2002 Board of Directors jointly tasked those two Committees to develop workable concepts of system scope and to propose models for career protection and progression.
Capt. Ron Abel (United), chairman of the BSIC, and Capt. Tom Wychor (Mesaba), an ALPA executive vice-president, along with Capt. Bill Dollaway (Northwest), chairman of the CBC, challenged the Board to take its message back to their members.
Capt. Wychor boiled the challenge down to a succinct quote from President Theodore Roosevelt: "Dare mighty things."
"Our industry and our union, from their inception, have been characterized by constant change," said Capt. Abel, "change in markets, in regulatory environments, in government policies, and in technology. But ALPA has proven time and time again that it can adapt to change."
That ability to take courageous, often-unprecedented action sets ALPA apart from other unions. ALPA pilots have initiated bold projects that resulted in success in working globally, in obtaining One Level of Safety, and in getting favorable legislation passed. Together, pilots have made strategic decisions that paid off for pilots of all generations, including backing the Decision 83 pay formula and affiliating with the AFL-CIO.
The Association itself has changed to reflect the times. Along the way, ALPA reengineered itself to represent first and second officers, to bring in pilots from all sizes of airline, to account for national and global deregulation, and to respond with patriotic zeal to the terrorism attacks of 2001.
The right questions
"We have learned from living in an industry dominated by constant change that we must first ask the right questions to solve our problems," Capt. Abel said. "We have to focus on reframing issues so that the right problems are addressed, distinguishing systematic patterns from random events."
Some of the questions pilots should be asking include the following:
• How does the airline industry today differ from that of the past?—One big difference, Capt. Abel said, is that current managements throughout the airline industry think of the entire airline system as a single network. They view each of the separate companies as a combined whole, able to move production—flying opportunities—across a vast global network. The local managements at each of those "divisions" have a single goal—to supply labor at the lowest possible cost. "Pilots, however, have no ability to shift to either the vagaries of the market or management’s whims," Capt. Abel said. "We are trapped in our individual silos."
• How have pilots responded to management’s tactics?—Capt. Abel noted that pilots have tried to resist the vertical "disintegration" of their networks by negotiating scope protection to protect flying carrier by carrier. That’s old thinking, he said, because that response grew from the environment that existed before alliances and affiliations became common business practice in the airline industry. "We have each fought independent battles with management," Capt. Abel said, "and consequently we have not spent enough of our time working with each other. Because of that, we have had insufficient orderly career progression and furlough protection."
• How can pilots do a better job of protecting and promoting the careers of ALPA members?—Capt. Wychor said the two committees came to three basic conclusions: ALPA must develop system scope provisions, coordinate work allocation, and foster career progression and protection. "All three of these concepts are interdependent," he said, "and each element depends on an unwavering commitment to strengthen and constantly improve the others. Taken together, they break down the barriers that prevent pilots within a network from capitalizing on the leverage that pilots’ access to the entire network during the course of a career would provide."
Resolving those conclusions
Developing system scope provisions to protect the entire network would be the foundation on which to build a durable alliance among all pilot groups in each network, Capt. Wychor said. The primary goal would be to protect the flying opportunities for pilots of the carriers in each network. At the same time, system provisions would take away management’s ability to move flying opportunities to groups outside the network and outsource the work to ever cheaper sources.
"We must neutralize management’s ability to dilute our bargaining strength by forcing us to compete with each other and work for less," Capt. Wychor said.
Work allocation coordination goes hand-in-hand with system scope and career progression, he said. Master executive councils would have to work closely with each other to keep system managements from making coordinated decisions in management’s interest instead of pilots’ interests.
Capt. Wychor said that building a "community of interest" would not be easy, but that MECs could begin laying the groundwork by fostering rational discussions among their pilots to highlight the career advantages to be had through cooperation and shared outlooks. For system scope to work, pilots must see the benefits of having the opportunity to move throughout the entire network during the course of their careers.
"While management sees a single enterprise, pilots work in a very different company," Capt. Wychor said. "Pilots see a company with separate pilot groups, multiple corporate entities, multiple contracts, and separate networks. We must begin the process of change by initially moving to a single network with a clear migration path for a pilot’s career.
"From there, we can ultimately move to a more robust and durable set of career protections with coordinated pilot groups, coordinated contracts, and a seamless career path within a single network."
Capt. Wychor noted that the strategy to reach those goals should recognize that different groups pose different challenges and will require different tools and methods. Bargaining opportunities will come at different times, with unique obstacles to be overcome. The two Committees do not expect a single approach to fit all circumstances.
"However, we must act decisively now to reap the benefits and counter the dangers of our increasingly interdependent world," Capt. Wychor said. "The challenges are fearsome, but so are our strengths. Our greatest strength is the power of our ideas, and we are proposing one simple idea: Pilots should have access to the entire network during the course of their careers.
"The road to success will be a challenging one, but we must begin the journey. We must, indeed, ‘Dare Mighty Things.’"