Today I heard that United Airlines is seeking yet further wage and work rule concessions. This led me to wonder, how much more can they cut wages and benefits before it impacts the ability of the airline to maintain staffing levels? I suppose in the industry it’s something just to have a job, but surely at some point don’t employees start to say, to hell with this, it’s time to transition to another industry?
On a related note, what is meant by “work rules” in this context?
I was wondering – how much of a salary cut are the airline executives taking? Please tell me that they’ve given up the same percentage as the employees; if not, I don’t hold out much hope for the industry.
According to The Chicago Tribune, the execs are taking a 15% cut.
I heard that pilots earn the most money, after the execs, and are taking the biggest cuts, but I imagine that would be applicable only to the long-haul pilots that fly the biggest jets. Other threads here discussing pilot salaries in the past have made it clear that pilots who fly smaller aircraft don’t make anywhere near as much the jumbojet pilots. How much can the airlines expect to cut their salaries? They have the same awesome responsibility as the long haul pilots, only the planes are smaller and don’t go as far.
From the Airliners.net message board.
<b>“Along with labor concessions, United senior executives, including Tilton, also have agreed to a 15 percent wage reduction beginning Jan. 1, Medina said. Tilton earns $712,500 annually.”</b>
<b>IMO, Tilton should be PAYING United 712,500$ a year to work there. He is a complete idiot and cannot run a business. 15% of 30,000 is $4,500 cut for the avg. employee (assuming they avg $30K.) After his cut, Tilton will still make $605,000. Guess he might have to go without the new Jaguar this year while the employees go without electricity.</b>
not many United employees too happy with the State ot their Airline
My brother in law is a pilot for a major airline (details withheld on the off chance someone in charge is possibly reading this.) They’ve cut his salary, then they closed his hub and told him he’d have to move or be laid off. His daughter is a senior in high school, and he and my sister in law have decided he’ll move and she’ll keep the house until my niece finishes the school year.
After that, he fully expects to lose his job completely whatever they do.
I am so sorry to hear this news. It is a string of eonomic woes swept under the rug, but the next economic bubble is about to burst in 1Q05, I’m sure.
Yup, here we go again. Another round of airlines failing Have people forgotten all the painful memories of the 1980’s? To think a whole generation missed this fun period in our recent history. How history repeats itself.
Alleghany? Eastern? Etc., etc.? All dinosaurs now, sadly. Well it’s not a surprise that the airlines are in trouble. US Air, for sure, has been in the news. This is just the tip of the iceberg, folks. You can look forward to no-thrills airlines, like People Express, rearing their dangerously cheap, ugly heads once more. Soon, it’ll be the only way to fly! But, we’re the US and we don’t deserve better do we? 
It’s pathetic what’s happening to the American family. But, those in charge have values…not family values, mind you, but they value something, like the dollar? I am in the same boat, and I sympathize with you 200%. - Jinx
Gee, he wouldn’t happen to be a Steeler fan, would he?
The concessions are getting to be a bit much, and they not only affect current works, but retirees as well. US Airways pension fund is underfunded by more than $2.3 billion and their lawyers are trying to get the courts to let them do an after-the-fact “restructuring” to their pension plans which will result in less money going to retirees who were loral and faithful to the company for years.
I am highly in favor of a change in the rules of bankruptcy. A company cannot emerge from bankruptcy so long as any CEO or upper management worker is making more than 110% of the salary of the highest paid rank and file worker. Telling a $36,000/yr flight attendant that they will have to move, that their seniority does’t matter because their routes are being eliminated and now they’re going to have to compete with a much larger group of people for the next best thing, oh, and by the way, the CEO will continue to make more than half a mill per year but their weekly paycheck is going to be $150+ lighter isn’t the way to run a company.
If the airline cannot manage with what it’s got coming in, then it’s got to cut back in what’s going out, and that means service cuts and layoffs. (Meanwhile, on hold with USAirways today, I learn that they’re adding daily service to Panama in January. You know, because so many people are dying to get to Panama every single day. More than want to go from Pittsburgh to anywhere else in the world without going via Philadelphia or Charlotte. :rolleyes:)
Yes, layoffs hurt the workers, certainly, over the short term, but far better to be laid off and have it done with and get to move on (while collecting unemployment for up to a year while you look) than to die the death of a thousand cuts by having your pay and benefits repeatedly sliced at and chipped down to nothing, and feeling stuck because the cuts have forced you to dip into your savings so you have no cushion to land on if you make the decision to finally walk away.
I don’t know how this works in the US, but whenever I hear this sort of thing in the UK I get very suspicious. It seems top management can recoup salary cuts by getting big ‘productivity’ bonuses - ‘justified’ because they instigated cost-cutting measures (i.e. fired or otherwise shafted the workforce)
That wouldn’t surprise me. In my last job I was able to see what a myriad of execs in many different industries were paid, and it was staggering. And often a “guaranteed bonus”. WTF is that???
In the industry I just came from my position was “eliminated” and I was replaced by two PT staff! Another co-worker had the only other admin eliminated and now she’s doing both jobs, and they’re again talking about a pay cut. Meanwhile, my former boss is making $191,000 and is taking NO cut and has not had his workload increased. In fact, he just hired a higher level person to share his workload. :mad:
Certainly true! Salary is a very minor part of the money for executives.
In the same paper this week were two stories:
It has caused me to start looking for something else to do.
I’ve only endured one pay cut (granted, it was a 23% cut), but the assault on pay, benefits and pensions is in full swing. It is immensely frustrating to see the profession I have worked my entire adult life moving backwards.
The guys at Delta are about to vote on taking a 32.5% paycut. This new “deal” will also layoff more pilots, make everyone still left work more days per month (for 1/3 LESS pay), increase medical coverage costs for employees and retirees, reduce vacation and sick time and change the pension plan to a more “affordable” one (more affordable for the company, of course).
Such a deal, right? It makes all the hard work required to even get the job in the first place, much less spend 25 or 30 years flying for the company worth it, right? :rolleyes:
Sorry, but this week has really gotten me down. USAir, United, Northwest and Delta…all in the news this week as employees look at taking more cuts.
I’ve been looking at doing something on the side that is completely outside the industry…maybe getting an MBA or something. I don’t hear about MBAs or lawyers taking 32.5% paycuts. Maybe they do, but I sure don’t see it.
On the bright side…I’m home, it’s a beautiful day outside and there’s NFL football on today! I think I’ll watch some games and forget about the airline industry for a while. 
Oh, and I forgot to answer Spectre’s question about “work rules”.
Work rules are constantly a battleground - the company wants to be able to work the employees harder, while the union tries to get the best deal for the employees.
As an example for pilots - we have things called “trip rig” and “duty rig”. These are minimum numbers of hours that you must get paid over the course of a day of duty or over an entire trip.
First - as pilots we only get paid for the time that the aircraft is away from the gate. Preflight, postflight are uncompensated. So we get paid by the flight hour, and the FAA says that we can only fly 100 hours a months. Most major airlines have work rules that have some number lower than 100 as the maximum - at my airline it’s 83 hours a month. Flying less hours per month means more days off, and more pilots. Good for us, bad for the company.
So the company says fine - you want to fly 80 hours? Well, we’ll send you out on a trip and only fly you 3 hours per day. You’ll fly three hours, spend the night in a hotel, fly two hours the next day, and four hours the next day. You are gone for three days and get paid for 9 hours. In this case, you have to work for 26 days to get paid for 80 hours. So the pilots say NO - if we are flying, you must either fly us or PAY us for a minimum of five hours per day. This not only ensures that you don’t spend all of your time in hotel rooms, but it makes the company use you efficiently. With a five-hour per day minimum, those 80 hours of pay come in after 16 days of work. Much better.
When companies talk of getting “work rule concessions” they are talking about things like this. Change the daily minimum pay from five hours to four hours, and you can have pilots on the road longer, or sitting around the airport for hours on end waiting for their next flight (in effect being the “on-call” crew for cancellations). You need fewer pilots to staff the airline, which reduces your costs.
Other things that can be changed are vacation (reduce the number of hours per/day that each vacation day pays), sick time available (reduce accrual rate and/or put a maximum cap on the amount you can accrue) and per diem rates (the amount you are paid while away from your home base).
Hope this helps (for anyone who actually read the whole thing!)
Now I really AM going to not think about the airline industry for the rest of the day!
Thanks to all who have responded. This thread sank pretty quickly at first, and I forgot about it, but someone obviously took notice since then.
It does seem like the discount carriers will take over the whole market, eventually. I imagine that many laid off pilots and other employees from the legacy carriers would be able to find employment with the discounts, but I imagine the salaries there are already low.
By “dangerously cheap”, do you mean that their safety standards are more lax?
I believe that the ratio of crashes per mile flown is higher for the new lower cost airlines. But I don’t have a cite to show this – does anyone? I don’t even know where such statistics are to be found.