Support Growing - Along With Labor Opposition

Reform of the Railway Labor Act of 1926 (RLA) will be a major agenda item for the Regional Airline Association (RAA) in 2003, supported by the newly created Communities for Economic Strength Through Aviation (CESTA). With some 30 labor contracts either in negotiations or coming up for negotiations this year among the U.S. regional carriers, the industry is hoping to prevent a destructive strike situation similar to the Comair pilots' strike.

"This is a huge issue for us," said Debby McElroy, RAA president. "It's something that doesn't get a lot of attention because the mainstream press tends to focus on the major carriers in their labor negotiations. But in fact, the regionals have far more contracts that are either being negotiated or will be negotiated this year. If you look at the disruption of the economy of the city of Cincinnati when Comair had its 89-day strike, it's really important that the communities that are so affected by this labor disruption, whether a [pilot] strike or CHAOS [Create Havoc Around Our System] by the flight attendants, it affects the communities and their economies."

Reform of the act is strongly supported both by Sen. John McCain (R-Ariz.), chairman of the Senate Commerce Committee, who has previously introduced legislation to change the RLA, and Sen. Kay Hutchison (R-Tex.), chairman of the Senate Aviation Subcommittee. However, even with that support, passage of any legislation is uncertain since it will require 60 votes to pass and labor is strongly against it. McCain has already scheduled hearings on a new RLA reform bill for Jan. 9.

Despite being defined as a method of getting both sides in a negotiations to present reasonable and acceptable demands, the reform movement is seen as an attempt by management "to gut airline labor of the one thing that any labor union has that gives it real power, which is the ability to strike," said John Mazor, spokesman for the Air Line Pilots Association (ALPA).

One flaw with the reform bill as previously introduced is its wording, Mazor said. "When you look at the language [of the bill], you could have the best and fairest arbitrator in the world; but when he looks at the language that lays out what he has to consider and how he has to consider it, it's almost impossible to follow the law and not take management's offer, which means management doesn't have to bring anything to the table. They could bring their blue-sky offer to the table as their last and best offer -- and the arbitrator is probably going to pick it."

Pat Friend, president of the Association of Flight Attendants (AFA), said that reform of the RLA is not necessary, that "within every airline that is experiencing financial difficulties, labor and management is working together to renegotiate the agreements and restructure to allow the airlines to survive." She also noted that the Dunlop Commission of the early 1990s got both sides together to review the RLA and make recommendations to the Labor Mediation Board "about how they could be more efficient." Friend told C/R News that following the Dunlop Commission review of the RLA, both labor and management "have found that the act has served us well for years."

While labor strikes have disrupted the industry to some extent, specifically the Comair strike, this has not led to huge increases in labor costs. According to a report in The Airline Monitor for August 2002, flight crew costs based on aircraft operating costs per block hour in constant 1982 dollars have remained virtually flat for the past quarter century and are, in fact, a little lower today than in the early 1980s.

The problem, however, is not that labor costs are rising, but that they were so high to start with. And while regional airline labor costs are much lower than those of the majors, they have to stay low for the regional to survive. However, Michael Linenberg, an airline analyst with Merrill Lynch, noted that some of the regionals are now rapidly approaching the category of a large national carrier such as Southwest or Air Tran Airways, giving them the opportunity to break away from their current code share partners and fly as independent carriers. This, in turn, could lead to demands from the labor unions to raise salaries to the level of the larger carriers - the precise action that was taken by the Comair pilots who wanted a pay scale similar to the mainline carrier.

Claude Sullivan, a partner with Atlanta, Ga.-based law firm of Ford & Harrison, LLP, and a specialist in airline labor and employment law, told C/R News that the coming year is not expected to be an easy one for labor relations in the regional airline industry "because of the differencing levels of expectations - the unions having expectations of approaching major airline work rules and benefits levels and the expectations of the regional airline managers to keep their costs as low as possible to satisfy the demands of the major carriers."

However, Sullivan also noted that he did not see any strikes developing. "Although it is going to make labor negotiations extremely difficult because you have the different levels of expectations going head to head, I think that in the end the unions will be realistic and know that you can't get blood out of a turnip, that they have to take the best deal that they are going to be able to get."

A driving force behind the movement to reform the RLA is CESTA, urging the U.S. Congress "to enact an airline negotiating mechanism that will resolve contract negotiations fairly, quickly and amicably, without the economically damaging threat of slowdowns and strikes."

Susan Molinari, CESTA president and former member of the House of Representatives from New York, told C/R News that the RLA needs to be changed, "but we want to do it the right way and not have it be an issue between management and labor, but really an issue that concerns the multitude of businesses and industries that rely on the predictability of a functioning airline."

The current RLA "provides insufficient incentive to reach an agreement. Negotiations frequently take too long, more than two years in many cases, and become increasingly acrimonious. Thus, instead of a timely resolution, the Railway Labor Act often causes an impasse as issues fester. Negotiations that do not result in strikes instead can lead to work slowdowns or other job actions, which disrupt air service through flight delays or cancellations. These interruptions in air service harm the economic vitality of our communities and the nation."

Molinari said that representatives from CESTA have been traveling around the United States to get the word out on the need to reform the RLA and to enlist members into the coalition. "The bill [to reform the RLA] has to be re-introduced and we are hopeful that we can get some additional co-sponsors, including Democrats, who understand the importance that the aviation industry plays to our overall national security and national economy. It is really pertinent to some of the Democrats that we think we can get to help support this bill. It is particularly vital to some of those portions of the country that are only served by one carrier." The coalition is now "several hundred strong" and includes business roundtables, chambers of commerce, "some terrific national organizations, other state, local and federal associations, airport authorities, economic development groups plus small and large companies throughout the United States," she said.

Although the bill to reform the RLA was introduced in the last Congress with strong leadership support, including Sens. McCain and Trent Lott (R-Miss.), it was not given much chance of passing. Whether it will pass during the upcoming session remains uncertain, although its chances are better with a Republican-dominated Congress, Molinari said. "Not every member of Congress will vote for the bill, but it does not have any leaders of Congress specifically against it," she said. "Clearly, with the shape of the Senate and House as they will be when they reconvene in January, I think having it come up for a vote will not be a problem. Making sure that we garner the public support and tell our message loud and clear to win that vote is what the CESTA organization is all about."

Molinari noted that the CESTA organization has a very strong command structure, with co-chairs made up of former Secretaries of Transportation Jim Burnly and Neil Goldsmith, former Sens. Slade Gordon and Chuck Robb, and former Reps. Ben Weber and Nick Fazio.

>>Contact: CESTA, Susan Molinari, telephone: 202-789-2111, e-mail: info@cestacoalition.org; RAA, Debby McElroy, telephone: 202-367-1170, e-mail: raa@dc.sba.com; ALPA, John Mazor, telephone: 703-481-4440, e-mail: mazorj@alpa.org; AFA, Patricia Friend, telephone: 202-712-9799; Claude Sullivan, telephone: 404-888-3841, e-mail: csullivan@fordharrison.com <<