Airline labor contracts can get extremely complex, and when it comes down to a vote, there are usually good arguments for both sides. Every so often, however, a vote comes up where there is clearly one right answer. That was the case with the American flight attendant combined contract vote, yet somehow, they voted against their own interests. It is incredible how badly they just screwed themselves.
As part of the merger and the exit from bankruptcy, the new American’s flight attendants (among other labor groups) agreed to a process for integration. The process that was agreed upon meant it would be a smooth transition, far easier than we’ve seen in other mergers. It was pretty simple. They’d come to a single seniority list (which is already done), and then they would enter into a short period of negotiations with the company on a combined contract. If they all agreed upon a contract, then it would go into effect. If not, then it would go straight to binding arbitration. Binding arbitration produces results that have to be accepted by both sides, so the process would be finished quickly no matter what.
With that backdrop, the flight attendant union, the Association of Professional Flight Attendants (APFA), went into negotiations to get the best deal possible for the flight attendants. What came out of that negotiation was surprisingly good for them, bringing $193 million in annual economic improvement over what they have today. That made for an industry-leading contract, and it beats what binding arbitration would provide.
How do I know that? Well, the rules for binding arbitration were set so that the average of the United and Delta contracts would be used to create the American contract. That provided an economic improvement of only $111 million a year. Even though the way you reach that number can vary (and would be decided in arbitration), that number is fixed. APFA came in with $82 million per year over that amount through negotiations.
This seemed like a no-brainer since the alternative was clearly set (unlike you usually find in airline/labor negotiations). The union pushed it out to the flight attendants to vote, and the results came back over the weekend. It lost by 16 votes. This is one bad move by the flight attendants, or at least the ones who voted against it.
It was extremely close, but even if it had gone the other way, that means nearly half the group still voted against what should have been an easy “yes” vote. Looking at how it broke down by base, it’s clear that the Miami and New York bases sunk this on the legacy American side. Only 37 percent of Miami flight attendants and 39 percent of New York flight attendants voted for it. Meanwhile in Dallas, Chicago, and LA it passed. On the US Airways side, Charlotte narrowly voted against it and so did the small base in Washington DC, but Philly and Phoenix approved (with US Airways as a whole approving it). Possibly the most insane group here is the 4,000 flight attendants (around 20 percent) that just didn’t vote. Apparently they don’t care about their future. If only this prevented those people from ever complaining again.
How the heck did this happen? As usual, I’m sure it was a combination of things that pushed the “no” vote to (Pyrrhic) victory. Here are just a few thoughts.
1) Some flight attendants will always vote no
You’ll always have that group that refuses to accept anything short of $10 million a year with a maximum of 5 hours a month flying. That’s a fringe group, but it still counts.
2) Some flight attendants didn’t understand or didn’t want to believe how this worked
Usually, if you vote down a tentative agreement, you just go back to the bargaining table and try again. I’m guessing that somehow a bunch of flight attendants simply never bothered to learn that this process was completely different. The union’s leadership put out a ton of communication on this subject, and it was incredibly clear. But it’s safe to assume that there are some people who don’t read anything the union puts out. There are others who read it but just don’t believe it. I’ve seen some things floating around disparaging union president Laura Glading. That alone could cause people to irrationally distrust her when she said this was the best thing they were going to get. (It was.)
3) Some flight attendants received bad information
There’s also the issue of front line rumors. When you see two bases voting sharply negative while the other big bases approved, you have to assume that something is happening specifically at those bases. My guess is that a lot of anti-contract misinformation was circulated in those cities, and the flight attendants got onboard. But I can’t know that for sure.
4) Some flight attendants wanted profit-sharing.
This contract did not include any profit-sharing, and that’s something that many flight attendants wanted. Instead, it included more money in the contract to make up for the amount of profit-sharing paid out by other airlines (notably, Delta). But some people were just not going to be happy without profit-sharing. Of course, turning this down still isn’t going to get them profit-sharing.
5) Some flight attendants didn’t like the work rules
Labor groups are never going to get perfect work rules. In this case, there’s no question that this contract is going to make flight attendants work harder than they did in the pre-bankruptcy contract. Some may have voted no because of that, but if they think they’re going back to pre-bankruptcy work rules, they’re mistaken. Really, if they think they’re going to make any big gains over what was just voted down, it’s not going to happen.
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Now, what happens? Well, binding arbitration starts on December 3. It won’t take all that long. I’d expect we’ll see the final contract around the new year. The two sides can in theory keep negotiating in the meantime, but why would they? They both agreed this was a good contract and the membership voted it down. There didn’t seem to be a clear mandate on what was missing, so further negotiations won’t help much. Besides, management doesn’t want to set a precedent for other labor groups. The pilots should have a new agreement presented by the company toward the end of this week and they’ll be in the same process as the flight attendants. If management decides to delay the process with the flight attendants further and keep negotiating, then it will defeat the entire purpose of this whole process as it relates to the other workgroups.
The incredible thing here is that from the company perspective, this rejection is a good thing financially. Annual costs will now go down by $82 million – money that the flight attendants put right back into company coffers. Other than that, there won’t really be an impact on things except to slow the contract process down by a couple months. The integration isn’t affected.
The flight attendants, however, have a problem. The entire flight attendant group will be pissed. The half that voted “yes” will be really angry that the other flight attendants made them lose money. The half that voted “no” will be livid when they realize that they screwed themselves, and their dreams of a better contract aren’t happening. Even though none of this anger is the fault of the airline’s management, you know it’ll get directed that way eventually.
But first, they’ll probably direct their ire at union leadership which is really a shame. I don’t say this often, but this union leadership team actually did a good job of going back and forth with the company to make sure that flight attendants would come out in better shape. It was just about to pay off. Oh sure, the flight attendants will still be better off than they are today, but they won’t be as well off as they should have been. It doesn’t impact me personally, but it still makes me mad that they squandered the opportunity.
[Original flight attendant photo via Shutterstock]
