US Airways Pilots Protest Slow Talks

CHARLOTTE, N.C. ( TheStreet) -- In terms of the US Airways ( LCC) pilot contract, little has changed since about 400 uniformed pilots quietly demonstrated at Charlotte International Airport in November, 2006, protesting the slow pace of contract talks.

On Tuesday, about 300 pilots did the same thing for the same reason at the same place, standing quietly in uniform for two hours.

"There's been almost no progress," said Mike Cleary, president of the U.S. Airline Pilots Association, at the event. "These guys have been working under bankruptcy wages for five and a half years," since they signed a contract during the carrier's bankruptcy in 2005. "There's not that much left of their careers, and they've had it." The average age of pilots from the former, pre-merger US Airways is about 56.

US Airways Executive Vice President Steve Johnson said in an interview that negotiators meet regularly and that delay is partially the fault of USAPA, which "has a lot of influence over the negotiating agenda" and has decided to focus on smaller issues, such as those that involve check airmen and "the precise way in which 400 grievances, some predating the merger, would be resolved.

"They are driving the process by spending so much time on issues that are tangential," Johnson said.

Of course, a seniority dispute between pilots from the former US Airways, known as "the east," and America West Airlines, overhangs negotiations. The carriers merged in 2005, but the pilot groups work under separate contracts, both with wages and benefits at the low end of the major carrier wage scale. The two groups long ago turned the matter over to the courts, where resolution has not been speedy.

Meanwhile, US Airways posted the highest third-quarter profit in its history and saw its shares rise 106% in 2010. This month, shares are up about 2%.

Cleary contends the carrier is stalling in contract talks because, as CEO Doug Parker has acknowledged, US Airways has a labor cost advantage to the three other legacy carriers.

In particular, Cleary said, US Airways was stalling in June when it filed a case in federal court in Phoenix, seeking a ruling on the seniority issue.

Cleary maintains the ruling is unneeded because a higher court, the Ninth Circuit Court of Appeals, has said US Airways pilots could end up with a contract that does not include the controversial Nicolau seniority ruling, which seems to favor west pilots. The June filing, he said, "is nothing more than a straw man obstacle to divert people's attention. The legal path is clear now. There is no legal impediment to negotiating."

But Johnson said that without a ruling, US Airways could be harmed by the result of contract talks, no matter what the result is. "If we go forward and continue to negotiate a contact with the seniority list, that could result in a threatened work stoppage, which would be very disruptive for the company and our customers," he said.

The other option: the carrier agrees with the union to abandon the seniority ruling. "Then the west would file a lawsuit against the union and the company, (which) could result in the company being responsible for millions in damages (and in) the court overturning that ratified agreement, which would put us back at the beginning of negotiations," Johnson said.

"Either of those two results is unacceptable to the company," he said. "Filing our lawsuit is a way of, once and for all, with the help of the federal court, resolving the dispute."

Johnson challenged the widespread assumption that the Ninth Circuit Court acknowledged the two sides could legally cast aside the Nicolau award if the contract includes adequate alternate protections for west pilots. In its ruling, the court said, "Even under the district court's injunction mandating USAPA to pursue the Nicolau award, it is uncertain that the west pilots' preferred seniority system ever would be effectuated." It is possible that USAPA will eventually implement a contract "that does not work the disadvantages plaintiffs fear, even if that proposal is not the Nicolau Award," the court said.

According to Johnson, "that passage said 'go negotiate, you might be able to negotiate something you both like, or something sufficiently acceptable that continued legal process wouldn't result in anything more.'" He said the passage does not necessarily mean the court would approve a contract without the Nicolau award. "If west pilots still don't like (the contract), then they can file a lawsuit.'"

-- Written by Ted Reed in Detroit.

>To contact the writer of this article, click here: Ted Reed

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