Labor Disputes Continue for Aerospace Industry

In the down market, aerospace stocks have truly been getting hit hard.  However, it has not solely been due to the recession.  Over the past six months there has been a wide variety of labor disputes on both the commercial and industrial sectors.  And last week has been another difficult time for this industry.

Midwest Airlines pilots, represented by the Air Line Pilots Association (ALPA), last week petitioned the National Mediation Board for assistance in contract negotiations with Midwest Airlines management. The pilots asked for mediation assistance after management stated that it had no intention of continuing direct negotiations unless the union agreed to all its concessions initially sought last summer prior to the start of contract talks.

“While the pilots remain fully engaged in working to reach a fair, consensual agreement, Midwest management has refused to do the same,” said Capt. Tony Freitas, incoming chairman of the Midwest Master Executive Council. “Instead, management continues to demand the same outrageous concessions that it did last July, despite several changes in the airline’s situation and operational plans.”

Midwest pilots’ current contract is a concessionary agreement reached in 2003 and became amendable August 31, 2008. The pilots began negotiating with management in October 2008, a month after the airline cut nearly 300 pilot jobs in a deal that outsourced much of Midwest’s flying to Republic Airways.

“We are committed to obtaining a new contract that offers some level of job security and maintains a decent quality of life for Midwest pilots,” said Capt. Ken Krueger, chairman of the pilots’ Negotiating Committee. “However, we have reached the point in our direct negotiations with management’s representatives where we believe that the assistance of a federal mediator is necessary to help us move this process forward.”

In December, the pilots submitted a comprehensive proposal addressing compensation, scheduling, retirement, and insurance. When face-to-face talks resumed in January, management failed to offer a counterproposal. Instead, management again demanded concessions and advised the pilots that negotiations would not be productive unless they submitted a proposal providing those concessions. It is always so tough to figure out who is being too tough in these labor negotiations. Labor complains they must give concessions when things are bad but don’t get the upside when things are good. Management claims lots of perks come their way when times are better. And so it goes.

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