milehighclub Posted March 30, 2003 Share Posted March 30, 2003 Looks like very clear to me how things go turn in the near futur for AC... Business -------------------------------------------------------------------------------- Posted on Sun, Mar. 30, 2003 An unhappy crew is left at US Airways The airline will emerge from Bankruptcy-Court protection tomorrow, but many of the workers still on the payroll resent the price they've had to pay to strengthen the company's finances. By Tom Belden Inquirer Staff Writer US Airways is poised to emerge from Chapter 11 tomorrow, far leaner and more financially sound than when it entered Bankruptcy-Court protection last August. But many of the company's employees are in no mood to celebrate. More than a quarter of US Airways' workforce - 12,000 people - has been laid off since Sept. 11, 2001. Those still employed saw two rounds of wage and benefit concessions since last summer that will save the airline $1.2 billion a year and give employees a stake in the company. Some workers are bitter while others are simply resigned to working harder, with fewer colleagues at their side, for less money. Working for a company that is trying to shrink its way to prosperity has left scars that may take years to heal, according to two dozen US Airways pilots, flight attendants, ticket and gate agents, baggage handlers and retired employees, interviewed in recent weeks. "It's not just a financial thing," said Jack Lawrence, a Philadelphia-based pilot who has flown for US Airways for more than two decades. "It's an emotional thing... . You wish you could say to the CEO: 'Walk a mile with me.' " Pilots are among the most aggrieved, since some of them have seen their incomes cut by nearly 50 percent - from $180,000 a year to $100,000 - and pensions for those approaching retirement cut 75 percent. Experienced flight attendants who were making $45,000 a year ago now are earning less than $38,000. Senior customer-service representatives, who sell tickets and board passengers, have seen their pay drop from about $45,000 to less than $40,000. In many smaller cities, where commuter flights have replaced jet service, the agents have taken 40 percent pay cuts. Julie Meyer, a Philadelphia-based flight attendant for 14 years, said many of her coworkers were glum, but determined to stick with the company. "They're kind of like the band on the Titanic," she said. "They're going to go down with the ship. "There's the group that's very negative and angry," Meyer added. "There's a percentage that's resigned. I'm in the group that's cautiously optimistic." Despite the employee unhappiness, passengers should not worry about US Airways or any other airline compromising safety, industry officials, pilots and independent experts say. While a disgruntled flight attendant or ticket agent may not deliver service with a smile, professional standards and regulations govern flights themselves, noted Peter Cappelli, a management professor at the Wharton School and a specialist in labor-management relations. "It's hard to see a pilot doing anything outside the professional norms... and there's also a ton of regulations they have to follow," Cappelli said. "They don't have much discretion over how they fly the plane." Since the beginning of 2001, the industry has lost $17 billion and laid off 90,000 employees. US Airways and some other carriers operate only three-quarters as much service as they did before 9/11. Unless the Iraq war ends quickly, industry officials expect business to be so depressed that airlines will lose an additional $4 billion and cashier an additional 70,000 employees this year. US Airways employees are bracing for even more layoffs and for an additional 5 percent pay cut for up to 18 months, allowed by union contracts in case of war. Employees at other big airlines are facing a similar choice because of the state of the industry. United is already in Chapter 11, and American could be there in the coming weeks. Labor is the biggest single expense for most airlines, and the big carriers with far-flung hub-and-spoke route systems need thousands of employees. Labor costs increased in the 1990s, when unions negotiated good raises for employees at a time carriers were making money. US Airways officials point out that management also shared in the sacrifices of 2002, with everyone who makes more than $30,000 a year taking salary cuts and paying more for benefits. Health-care insurance premiums for everyone, including retirees, have tripled or quadrupled. President and chief executive officer David Siegel took the biggest pay cut of all - 20 percent of his $650,000 salary. He still made $1.45 million in total compensation last year, but that is about 80 percent less than the CEOs at Continental and Delta made in 2002, according to reports the airlines made to the Securities and Exchange Commission last week. Continental chairman and CEO Gordon Bethune received a package worth about $11.9 million, including options. Delta awarded its chairman and CEO, Leo Mullin, a $13 million pay package. US Airways officials realize the employee concessions and the industry's dismal financial condition have hurt morale. "I haven't met anyone who isn't frustrated with the situation," said Jerry Glass, US Airways senior vice president-employee relations. "So much of it is out of their control." To make US Airways a better place to work again will take time, Glass added. "We didn't get into this situation overnight, and we're not going to fix it overnight either," he said. "It's going to take time to heal the wounds that have developed." The loudest cries of anguish come from pilots, who make the most of any employee group but who also have taken the biggest percentage pay cuts. The handful of pilots who fly wide-body jets make more than $200,000 a year, but far more, who fly other types of planes, made $100,000 to $200,000 before the concessions. Most airline pilots start out working for commuter carriers, making less than $15,000 a year. It can take 20 years or more to reach triple-digit salaries, and federal law requires them to retire at 60. Because of the layoffs of more than 1,800 pilots with the least seniority, many US Airways captains had to be demoted to copilot, which resulted in a 25 to 50 percent cut in pay. But what angered pilots the most was the way US Airways used Bankruptcy-Court protection to turn over their defined-benefit pension plan, which would have been $600 million underfunded in 2004, to the federal Pension Benefit Guaranty Corp. Pilots had anticipated their pensions would be $70,000 to $100,000 a year. Now the maximum annual pension will be $28,500. In addition, current employees will participate in a 401(k)-style defined-contribution plan. The company said that it had no choice but to scrap the old pension plan, to meet the financial constraints placed on it by its post-bankruptcy lenders. "There are people in the pilot community who are absolutely outraged," said Linda Vaughn, of Daytona Beach, Fla., the wife of a US Airways pilot. "There is a pretty large group of pretty unhappy people." Include this man in that group: a 58-year-old pilot only 18 months away from mandatory retirement, after 34 years of flying for two airlines. "I'm going to get a government pension, and I'm a little bitter about that," said the pilot who requested anonymity. "I was expecting a lump-sum payment of about $1.2 million. "It's devastating," he added. "You know how you wake up in the middle of the night, thinking you had a bad dream, and say 'Thank God that's over.' Then you realize that it wasn't a dream, and it's not over. I've got a real empty feeling in my soul." Still, US Airways' situation has prompted realistic assessments from other employees. "I might be the exception, but I'm happy to have a job," said a North Carolina-based pilot, who, like most of the employees, asked not to be identified. "I'm still making $100,000 a year and I don't know where else I could do that... . I believe we have a good leader [siegel]. I'm optimistic." -------------------------------------------------------------------------------- Link to comment Share on other sites More sharing options...
Guest BillyBigToe Posted March 30, 2003 Share Posted March 30, 2003 If we ask real nice would you consider proof reading your posts in the futur? Link to comment Share on other sites More sharing options...
Guest low torque Posted March 31, 2003 Share Posted March 31, 2003 Maybe you should follow your own advice! Link to comment Share on other sites More sharing options...
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