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January 10, 2014

American Eagle pilots union reaches new contract agreement with regional carrier

American Eagle's pilots union reached an agreement with the regional carrier's management that guarantees 60 of the new Embraer 175 aircraft that American Airlines ordered in December to be used with Eagle.

There are also options for 90 other aircraft to be operated by the regional carrier, the Air Line Pilots Association and the carrier said on Friday evening.

In exchange for the aircraft, the pilots pay rate scales will be frozen until 2018.

Here is the letter sent by ALPA to its members and a memo from American Eagle's president Pedro Fabregas issued Friday evening.

-Andrea Ahles

ALPA MEC letter

MEC Hotline – January 10, 2014

 

Today, the MEC affirmed an Agreement In Principle (AIP) giving the company contractual concessions in return for a guarantee of 60 new Embraer 175 aircraft, options for 90 more, and increased flow through opportunities.  Attached to this communication is a summary of the agreement.  We encourage all pilots to read this document thoroughly. 

 

The ALPA officers and leadership are preparing further communications for the pilot group in order to ensure that everyone has a complete understanding of all the facets of this AIP.  The purpose of this AIP is to allow the process of moving toward changes in our pilot contract.  Before the changes actually become effective, ALPA will conduct an educational campaign and appearance events allowing all pilots to give feedback, ask questions and gain a thorough understanding.  During this process, ALPA and the company must reach agreement on the contractual language.  At that point, the MEC will reconvene to review and approve the language.  Upon MEC approval, the language will then be made available to the pilots prior to a ratification vote.

 

This AIP will have varying levels of impact upon different pilots in the group and will take time to sufficiently grasp.  Your leadership is committed to the education of the pilot group.  Please contact your status reps with questions, concerns or feedback and we will do everything possible to respond. 

 

The company chose to put us in this onerous position, however we will work through this together.  This agreement will live or die on its merits alone.  Even though there will be differing opinions, I am committed to maintaining an unbiased, objective perspective throughout the remainder of the process.    

 

Fly safe. 

 

Bill Sprague

MEC Chairman

 

Summary of the Agreement in Principle – January 10, 2014

 

 

Duration

 

10 years from DOS.

 

 

Compensation

 

Pay rate scales will be frozen until 2018. 

 

Beginning 1/1/2018, pilots will receive 1% annual increases unless they have declined flow through.  However, Captains at longevity step 18 as of the date of signing of this agreement who decline flow through will receive the 1% annual pay rate increases beginning in 2018.

 

Captain and First Officer turbo-prop rates will be eliminated.

 

Longevity step increases will continue until the first EMB-175 delivery or 3/31/2015,

      whichever is later.

-     Thereafter, the Captain pay scale will be capped at 12 years of service and the

      First Officer pay scale will be capped at 4 years of service.

-     Captains above pay step 12 and First Officers above pay step 4 on that date will

      remain at their current step.

 

Effective with the 1st EMB-175 delivery, a pilot who declines an offer at American Airlines will cease to receive longevity step increases at the time he declines flow through, except that any captain at steps 15 through 17 when the first EMB-175 is delivered will be allowed to advance to step 18.

 

Effective 1/1/2014, profit sharing will be eliminated as long as it is eliminated for all other AE employees.

 

Enhanced Flowthrough

 

Beginning 9/1/2014, American Eagle will not restrict the flow of pilots to less than

30 per month.

 

Protected Pilots           The minimum available AA class positions will be increased from

                                    35% to 50% for pilots who were on the seniority list as of 10/11/2011.

 

All pilots hired after 10/11/2011 (including future hires) will have the same flow through opportunities provided by the Protected Pilot Agreement.  

-     The minimum available AA class positions will be 50%.

-     Pilots hired after 10/11/2011 may be withheld for active

      Performance/Attendance Advisories.  An expedited dispute resolution

      process will be available to such pilots.

 

Annual True-up           In any year that AA hires 720 or more pilots, at least 360 will be 

Effective 1/1/2015      Eagle Flowthrough Pilots.

 

                                    In any year that AA hires fewer than 720 pilots, at least 50% will be

                                    Eagle Flowthrough Pilots.

 

                                    This does not release the company from the obligation to release

                                    at least 30 pilots/month subject to the 50% calculation.

 

Within 30 days of mainline integration, Eagle and ALPA will meet and consider flow through enhancements.

 

Nothing in this proposal will compromise the Association’s position with respect to the current withholding dispute. 

 

Sick

 

Accrual                        After 90 days but less than 5 years of service:   3.5 hours/month

Effective 1/1/2015      After 5 years of service:   4.0 hours/month

 

Supplemental Sick       Banks will be frozen but remain available.

Effective DOS              Eliminate 7 day waiting period for access to supplemental sick.

 

Reserve days will be paid and credited at 4 hours/day.

 

PTO system will be eliminated.

 

 

Vacation

 

Accrual                                    After 1  year    1 week

Effective 1/1/2016                  After 2 years   2 weeks

After 7 years                           3 weeks

After 14 years                         4 weeks

 

No pilot’s accrual rate will be lower than the rate he or she has on 1/1/2016.

 

Vacation for new hires will be pro-rated in accordance with the current Eagle Contract.

 

Return to the 2009 CBA vacation section except as modified above. 

 

PTO system will be eliminated.

 

 

EMB-175 Initial Cadre

 

The company wants to abbreviate the training when the EMB-175s are delivered, so the initial cadre may be trained in advance and returned to their old equipment until EMB-175s are delivered.

 

The initial cadre training for EMB-175 pilots who are trained in the EMB-175 will return to their existing equipment type once the initial cadre training is completed.

 

No company jeopardy during the training to return to existing equipment and subsequent requalification training for the EMB-175.

 

 

Per Diem

           

Per diem will be $1.80 for the duration of the contract.

 

 

Medical

 

Effective 1/1/15, increase employee contribution from 30% to 31%

Effective 1/1/16, increase employee contribution to 33%

Effective 1/1/17, increase employee contribution to 35%

 

 

Retirement

 

Maintain Eagle 401(k) plan.

 

PBS

 

The parties’ obligations under Letter 13-04 are suspended (without retroactive effect) until delivery of the 61st EMB-175 at American Eagle Airlines.

 

Signing Bonus

 

$1500 paid to each active pilot as of the date of ratification. 

 

Payments will be made within 30 days after DOS.

 

Amendment Round

 

Reopener of no cost items at 5 years after Date of Signing.  Each party may submit up to 5 issues which will be resolved in interest arbitration if not resolved in negotiations.

 

 

Fleet Commitment

 

Minimum of 60 EMB-175s to be operated by pilots on the seniority list. 

 

If AAG acquires additional EMB-175 aircraft from the manufacturer, the first 90 such aircraft delivered will be placed on the EGL operating certificate.

Dear American Eagle Team:

I am very pleased to report an agreement in principle, subject to language being finalized, has been reached with our pilots, represented by the Air Line Pilots Association (ALPA). If ratified, this agreement will form the foundations of a very bright future for not only our company, but also for our pilots by providing them new, large and modern aircraft to fly and a faster path to growing their careers at American Airlines.

The agreement will allow American Eagle Airlines to upgrade its fleet with a guarantee of 60 new Embraer 175 (E175) regional jets beginning in the first quarter of 2015. Additionally, American Eagle Airlines will operate up to 90 additional E175 jets should American Airlines exercise the options on those aircraft. The E175 is a top-tier regional product that offers a First Class cabin, Main Cabin Extra and in-flight Wi-Fi – important elements of an improved flying experience for our passengers. As one of the most fuel-efficient modern aircraft, the E175 will lower operating costs for our flying business when they begin replacing some of our smaller, less efficient 50-seat regional aircraft scheduled for retirement.

For our pilots specifically, this agreement dramatically improves their ability to further their careers at American Airlines by enhancing the company’s industry-leading Eagle-to-mainline flow through rights for current and new hire Eagle pilots. The time it takes for many of our pilots to qualify and be given priority over external candidates for pilot positions at American with this enhanced flow through will be nearly cut in half, allowing our current pilots to quickly advance and grow their careers at both Eagle and American. It will also help us attract the best new talent because we will be able to offer a clear career path to a mainline carrier and a positive career expectation no other regional carrier can currently offer.

Much work and discussion went into creating this agreement in principle that would satisfy all groups involved and should this be ratified, the future of our company has never looked brighter. ALPA will announce details of the agreement, which is subject to language being finalized, and a voting schedule soon and we are pleased our professional pilots will have the opportunity to vote on their future.

I commit to keeping you informed of any news and developments and as always, thank you for all of your work on behalf of our passengers and American Eagle Airlines.

Best Regards,

Pedro

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