Labor Relations Update: Our answers to questions from flight attendants

This week, we’ll answer a few of the questions we received from flight attendants in response to last week’s communications:

Is it true that United negotiators didn't attend the last day of negotiations?

This is not true. The company’s entire negotiating team was present through the close of business on July 23 and did not leave Washington until the following day. We were available for negotiations every day throughout this past session.

Why did negotiations just start a year ago, instead of five years ago when we merged?

By agreement with AFA, negotiations for a joint agreement did not begin until December 2012. Before we could begin negotiations, AFA (which represented pre-merger UA flight attendants) and IAM (which represented pre-merger CO and CMI flight attendants) needed to have a representation election. That election did not conclude until June 30, 2011. Although the company requested joint discussions, AFA was not willing to discuss a joint agreement until the parties finished negotiating a separate contract covering just the S-UA side that had been under discussion since prior to the merger. Following the completion of that contract in early 2012, the S-CO and CMI groups then wanted their own new, separate contracts, which the company and the union completed in August 2012.

At the outset of joint negotiations, United suggested a progressive, interest-based approach, but AFA instead chose to engage in traditional, proposal-based bargaining. During these negotiations we reached only four minor tentative agreements in 18 months. The lack of progress led to friction both within the AFA joint negotiating committee and between AFA and the company. However, the S-UA AFA then elected new leadership, and in June 2014 United and AFA agreed to adopt the facilitated-problem solving model promoted by the National Mediation Board. We’ve been using that process, with certain modifications, for just over a year with the NMB’s assistance, and we’ve made a lot of progress.

We’ve committed not only to match what is clearly the industry-leading contract today – in terms of pay rates and overall economics – but also to exceed it and make United the undisputed industry leader.

Is the economic framework United presented concessionary?

Absolutely not. In June 2015, in an effort to accelerate negotiations and at the request of the NMB, United presented AFA with a comprehensive economic framework for a joint agreement. That economic framework was not concessionary, and it was designed to further the negotiations by offering an economic package that was quite attractive. Although it didn’t have everything everyone on the JNC wanted, and while it might not be what every flight attendant wants, our framework matched – in terms of pay rates and overall economics – the industry-leading contract recently negotiated at American Airlines. As the JNC put it just last week, American spent $243 million (average annual) on their contract, and our framework proposal matched their contract, not in every detail (which neither AFA nor flight attendants want), but in terms of pay rates, costs and overall economics.

Did United propose eliminating the HMO health insurance benefit?

No. United is not proposing to eliminate HMOs and HMOs remain in all of the joint collective bargaining agreements. We did propose to change the cost-share for all medical plans to be consistent with joint agreements reached with all other employee groups. With this approach, employees electing an HMO would pay a portion of the monthly premium. Right now, under the S-UA agreement, for those flight attendants who live where HMOs are offered, most HMOs are “free” in terms of the monthly premiums employees pay for those plans. On the S-CO side and at CMI, employees pay a portion of the premium for HMOs and all other plans. We’re simply proposing that all employees participate in HMOs, PPOs, EPOs and other medical plan offerings on the same basis. This is how it’s done at virtually all airlines and among virtually all employers. The savings generated by adopting an industry-standard healthcare cost-share methodology will go right back to flight attendants in the form of the significant pay raises we’re proposing.

Why is UA using the AA contract as a comparison? The AA contract economics were forged during AA’s bankruptcy.

The AA contract economics were not forged during bankruptcy, but instead were developed over time through negotiations as part of the merger of AA and US Airways. In fact, the new AA contract is currently the industry-leading contract, by a substantial margin, and that’s why we use it as a comparison, starting point and baseline.

It is true that the agreements reached with APFA and AFA which facilitated American’s exit from bankruptcy and the merger with US Airways envisioned a contract that would be “market-based in the aggregate,” or the average of Delta, United and Continental. Because both AA and US were below that industry average, a market-based joint agreement would have cost AA about $111 million (average annual increase).

As it turned out, however, the parties negotiated a deal that was substantially higher than industry-average and resulted in a tentative agreement that actually cost an additional $82 million, or $193 million total (average annual). That put the AA agreement ahead of the S-UA, S-CO and CMI agreements in terms of pay rates, cost and overall economics. On top of that, AA gave another 4% pay raise for a total of about $243 million additional annual cost.

We’ve committed not only to match what is clearly the industry-leading contract today – in terms of pay rates and overall economics – but also to exceed it and make United the undisputed industry leader.

Flight Attendants Negotiations Updates: Archive