Alaska Airlines-Virgin America Merger Update: September 7, 2016

AFA International has guided several Master Executive Councils (MECs) through mergers at their respective carriers over the years, and each one has been different. The only commonality is the shortage of details throughout the merger process, and the patience that must be exhibited to wait out the long stretches of uncertainty and information voids.

Management has yet to make several key decisions regarding the merger such as brand identity and aircraft cross training. Remember, this is still very early in the merger process. This lack of information compounds our challenges in providing definite answers to your questions. Given that the Virgin America Inflight Teammates (VX ITMs) are voting on their first contract, AFA is doubly hesitant to speculate on future events and risk appearing to influence their TA vote.

That said, there are a few safe bets we can rely on given that management has committed to merging the AS FA and VX ITM groups:

• Seniority will be integrated by “competitive seniority (bidding) date” with appropriate training credit as set forth in Section X “Merger Policy and Related Employee Protective Provisions” of the AFA-CWA Constitution & Bylaws (C&B). *
• AFA will be the legal representative for both groups once the National Mediation Board (NMB) declares that there are sufficient common indicators to rule that Alaska Airlines and Virgin America are a single transportation system (“Single Carrier”). The NMB solely makes the decision of when that will happen based on progress made by Alaska Airlines management. The only influence the unions have here is deciding when to file—everything else is up to management and ultimately the NMB.
• At some point, the VX ITMs will be covered under the AFA Alaska contract and pay rates.

* What is competitive seniority date?

Competitive seniority date is the date from which each flight attendant accrues competitive (bidding) seniority as a Flight Attendant on her/his current seniority list (hereafter “seniority date”). AFA has previously referred to competitive seniority date as “date of hire,” for simplicity’s sake. Alaska Airlines Flight Attendants will receive a “training credit” adjustment to their respective seniority dates because Virgin America ITMs receive their seniority dates on the first day of initial training, whereas Alaska F/As receive their seniority dates following initial training. In order to make an “apples to apples” merging of the seniority lists into one, the Merger Representatives at each carrier will be responsible for appropriately adjusting seniority dates by accounting for training credit, while ensuring that no Flight Attendant’s relative seniority moves compared to her/his classmates.

Will the outcome of the VX Tentative Agreement (TA) vote affect any of the items listed above?

No.

What items would be affected by a YES or a NO vote on the VX TA

AFA cannot comment or speculate on items that would or would not be affected for three reasons:

1. The Transport Workers Union of America (TWU) is the representative union for the VX ITMs and it is TWU’s place to address any questions their members have concerning the TA and the Merger.
2. It would be highly inappropriate for AFA to put forth opinions that could potentially sway voters one way or another. The VX ITMs should base their decision on the provisions in the TA and supplemental information from TWU.
3. There is just not enough information concerning management’s plans to make solid predictions or forecasts. AFA could make suppositions based on incomplete facts and rumors, but that would do no good when so many pieces of this merger are in flux.

Is it helpful when AS FAs get on social media and comment on the VX TA or speculate as to what will happen if the VX TA fails or passes?

Probably not –

There are no definitive answers to many of the questions being discussed on social media. If AFA is stating that there is not enough information (or we are too early in the merger process) to answer those questions, then an individual who is not currently involved at a leadership level would likely not have sufficient information or background to answer correctly.

We can all agree that the uncertainty is frustrating and certainly there is comfort in engaging in a dialogue to discuss the situation. However, it is important to remember that the views expressed are assumptions and if that speculation, however well-intentioned, turns out to be incorrect and it sways a VX ITM to vote a specific way, then that will have been a disservice to the voter.

The VX ITMs must get information and guidance from TWU. However, some of the questions they are asking cannot be answered with certainty right now.

Are there other things that will happen regardless of a YES or NO vote on the VX TA other than those listed at the beginning?

Yes –

• AFA will go to the table and fight to improve the AFA Alaska Collective Bargaining Agreement (CBA), and all improvements will accrue to both groups when everyone is under the same contract. VX ITMs will be represented on the Seniority Integration Committee and Joint Negotiating Committee (JNC) as mandated in the AFA-CWA C&B.
• Typically in a merger, even after a joint contract is achieved it takes a period of time to merge the two work groups operationally to ensure a smooth integration of the groups. During this period, the two groups are kept separate until operational integration.
• AFA will have to negotiate how the VX ITMs are transitioned over to the AFA Alaska CBA (e.g. uniform credits, training, hours to TFP conversion for sick leave, etc.).

What are the plans for integrating the two groups and what is the timeframe? 

At this time, there are no firm plans communicated from management on how or when integration is planned to start. Remember, the Department of Justice (DOJ) has not even approved the merger at this point, so the merger is not final.

When the NMB decides that AS and VX are a “Single Transportation System” then will the two Flight Attendant groups be integrated?

We do not know when the NMB will make its ruling; however, in almost every situation, the “Single Carrier” ruling comes well before integration of the employee groups. The NMB’s determination was made years ago in the United Airlines (UAL) – Continental Air Lines (CAL) and American Airlines (AA) – US Airways (USA) mergers, and those Flight Attendant groups at those carriers are still many months away from integration. Admittedly, the merger of those groups involves much greater and more complicated negotiations and software/operational changes than AS-VX, but there will be challenges and ‘speed bumps’ that will most certainly delay the full integration of the AS-VX group.

Since most of the integration from the management’s side is finished, doesn’t that mean that integration of the other employee groups will follow soon? 

Integration of the management positions does seem to have happened rather quickly – so quickly that its all contingent upon the merger going through. Whether that is a prudent move or not will be shown as this merger rolls out. But do not take fast action on the management positions as an indicator that the Flight Attendant group will also be quickly integrated. So much has to happen before full integration takes place: Seniority integration, negotiating a process agreement for the merged contract negotiations, negotiating the JCBA, branding decisions, operational changes and software upgrades, aircraft livery, etc.

Is this slow pace and lack of information unusual for an airline merger? 

Unfortunately, it is completely normal, and it has been AFA’s experience that mergers often play out like this. All mergers are unique and take a different path and timeframe. There is little use in speculating how the AS-VX merger will eventually happen. But do know that through the delays and lack of information, AFA will continue to push for answers and will advocate for members interests just like AFA did in the below mergers.

• UAL-CAL merger: DOJ approval in 2010, Flight Attendant groups on target to be merged in several months (2017).
• AA-USA merger: DOJ approval in 2014, Flight Attendant groups on target to be merged in several months (2017).
• AirTran Airways (ATR) – Southwest Airlines (SWA) merger: DOJ approval in 2011, Flight Attendant groups were merged slowly over a 4-year period. The end of the integration period was in 2015.

The final DOJ approval has not happened, so while management is working through the merger process, they are not going to release any details until they feel it is the appropriate time. Of course this makes AFA’s job of keeping you informed along the way very difficult. When we know details, we will pass them on.

In Solidarity,

Your MEC – Jeffrey Peterson, Brian Palmer, Yvette Satterlee, Lisa Pinkston, Laura Masserant, Cathy Gwynn, Tim Green and Brice McGee