Northwest Targets Flight Attendants For Outsourcing
Ailing Carrier Seeks Savings By Pushing Veteran StaffersOff Prized Overseas Routes
By SUSAN CAREY
October 26, 2005
Emboldened by its success in beating a mechanics strike with an army of replacement workers, Northwest Airlines is trying another hardball tactic against organized labor -- an outsourcing maneuver other airlines may be forced to copy.
Part of the plan this time involves farming out some of the positions filled by senior flight attendants on coveted international routes. It's another sign that Northwest, which filed for bankruptcy-court protection last month, wants to become a "virtual airline," with all sorts of jobs previously claimed by organized labor outsourced to cheaper workers, some overseas.
Earlier this month, Northwest told its bankruptcy-court judge that it will ask the court at a Nov. 16 hearing to cancel its current labor contracts if the unions don't agree by mid-November to new terms that would save hundreds of millions of dollars a year. The carrier also is trying to outsource pilot and ground-worker jobs.
Not only is the airline asking the flight attendants for 17% pay cuts, it is proposing to have 75% of its flights across the Atlantic and Pacific and all of its flights between Amsterdam and India staffed by "regional flight attendants" who aren't currently members of the Professional Flight Attendants Association union. That's the group that represents Northwest's 9,800 U.S.-based flight attendants.
Northwest also is seeking to move all the flight-attendant jobs on planes with 77 to 100 seats that fly in North America to attendants not on the PFAA seniority list, and to cut the number of U.S. flight attendants allowed to work on flights from Japan to the rest of Asia to one from two. The seniority list ranks attendants according to hire date, and the ranking affects pay, assignments and other quality-of-life issues.
Those intra-Asia flights are mostly staffed by nearly 700 Asian attendants from bases in Japan, China, South Korea, the Philippines and other countries. They operate under different pay and work rules but have language skills for Asian destinations as well as English. The current union contract allows this limited but longstanding outsourcing.
Northwest is seeking cost savings of $195 million a year from the flight attendants through 2010. The airline, based in Eagan, Minn., and the nation's fourth-largest by traffic, said it hopes to achieve mutual agreements on concessions with all its unions except for the mechanics before the Nov. 16 hearing. It also said it remains open to suggestions from the unions on alternative ways to reach the cost-savings targets it has identified.
No other U.S. airline has managed to take away most of the prized international flying normally awarded to the most senior attendants. If Northwest succeeds, its big rivals might be forced to follow suit simply to get their costs into line.
Many U.S. attendants like overseas flights because they earn more, can pack more hours of work into fewer days and sometimes can enjoy longer layovers in attractive foreign cities. If Northwest took much of that work away, it would push veteran attendants into domestic flying and displace colleagues with less experience.
Other unions are worried. "The situation at Northwest is potentially devastating to all flight attendants across the country," said Pat Friend, international president of the Association of Flight Attendants, AFL-CIO, in a press release. Her union represents 46,000 attendants at a number of carriers. In a letter to the president of PFAA, a small union that isn't affiliated with the AFL-CIO, Ms. Friend said: "One thing we have learned during this financial crisis in our industry is that proposals like this spread from carrier to carrier like the most virulent disease mankind has ever experienced."
PFAA says it is focusing its attention on negotiating a cost-saving contract agreeable to both sides before Nov. 16. "Aside from our own jobs, we're also conscious about how things domino in the airline industry," says Bob Krabbe, the union's assistant contract administrator. "Were the company to get its way, this would be a huge slap in the face to the American worker."
An Aug. 20 strike by Northwest's 4,400 unionized mechanics and cleaners allowed the airline to impose new terms on the replacement workers it brought in to look after its fleet when the work stoppage began. Now the airline is permanently hiring some of the replacement workers, and has vastly cut the overall number it needs to just 880 by outsourcing work to third-party contractors in this country and abroad.
PFAA estimates that 2,600 more attendants would be laid off if Northwest outsources most of the overseas flying and goes ahead with the creation of a new subsidiary to handle small-jet flying on domestic routes. Those cuts would come on top of 1,400 others who will lose their jobs in the coming months as the airline pares capacity in bankruptcy.
This threat comes at a time when Northwest is trying to pressure unions to agree to big concessions. But if the unions don't agree to givebacks -- and vote them in through ratification by members, the bankruptcy judge could annul the current contract and allow Northwest to impose terms that could look a lot like these.
Northwest's concessionary plans also take aim at its pilots and ground workers. The new regional airline Northwest wants to start would allow the pilots to be members of the Air Line Pilots Association, but not ALPA members from Northwest's seniority list. There would be no limits on the number of planes that would fly for the new carrier and wages would be "average for the regional airline industry," or much lower than those at Northwest.
"They have staked out a really extreme position," says Capt. Hal Myers, spokesman for the ALPA branch at Northwest. "Whenever they negotiate, they tend to overreach. This is completely outside the box of what other carriers have or have asked for." The pilot said ALPA has offered to keep that regional flying within its union at lower costs, and is worried that Northwest ultimately would spin off or sell the new unit, taking all of those jobs away from the union.
Northwest also is seeking to outsource all ramp workers' positions except at its hubs and all customer-service-agent jobs at its non-hub airports, according to the carrier's proposals to the International Association of Machinists union. Bobby DePace, head of the IAM district that represents 14,600 ground workers, says those changes probably would end up eliminating 5,000 jobs.
Northwest officials declined to comment on details of their cost-cutting proposals or the remarks of union officials.
Several of the largest U.S. airlines -- including AMR Corp.'s American Airlines, Delta Air Lines and UAL Corp.'s United Airlines -- already employ less expensive foreign nationals as flight attendants, but the practice is limited -- and mostly inherited from the days when these carriers bought international routes from ailing forebears like Pan American World Airways and Eastern Airlines.