As American Airlines and US Airways workers were rallying on Capitol Hill for the government to approve the merger between the two carriers, union leaders met with top Justice Department officials to discuss the pending antitrust lawsuit.
Bill Gray, Transport Workers Union Local 544 president, was one of the union leaders at the Thursday meeting where DOJ Assistant Attorney General Bill Baer listened to labor's concerns but reiterated that a settlement prior to the November trial was unlikely.
"The assistant attorney general did mention they filed the suit in such a way that there really was no settlement that would be workable but he did indicate that they would always be open to a settlement," Gray said. "Mr. Baer suggested there was a settlement option but that it would be very difficult for the carriers to provide that settlement."
Here is a Q&A the Star-Telegram had with Gray on Friday afternoon after the DOJ meeting.
ST: How did the meeting start at the DOJ?
BG: We did the pleasantries. Bill is a very engaging, cordial individual, very much a gentleman. There was a very open gracious reception.
ST: What did you discuss with the DOJ?
BG: I think it was on merit. It was what it should have been what you really wanted was an open, an honest, frank discussion about labor’s concerns about the DOJ’s antitrust complaint. We, of course, certainly were very passionate about explaining labor’s view of this and the potential for a problem going forward with the two carriers as far as adversely affecting labor as well as consumers. We brought a perspective that they admittedly they told use hadn’t considered the perspective we brought…They admitted they look at [the merger] from a consumer perspective and not a labor perspective. They were very respectful. They listened. They were very engaged in asking questions in a discussion about the subjects that we brought up.
ST: Did the union leaders meet ahead of time to plan out what to mention at the meeting?
BG: The one commonality with this and we talk because we obviously want to make sure we were all, in the short period of time we had, able to get our point across. There is no daylight between the unions on the issues. We all recognize that we find ourselves today in a situation where the government has created these huge carriers, the new Delta, the new United and the new Southwest and it puts us at a competitive disadvantage and that competitive disadvantage could ultimately be negative for consumers. That was the important thing we wanted to get across to the DOJ is the unintended consequence of their action could harm consumers ultimately, because if our carriers are unable to compete in this marketplace, especially in corporate traffic, we won’t make it…And if you think about it, our two carriers have traditionally served small town America. We have been enabling the air transportation system to the heartbeat of America, the small industries that depend on air travel to sell their goods and have their meetings and be able to participate in the economic engine of America. If we look at the reality in many cases here on the East Coast [US Airways] may be the only carrier in the airport with our Express divisions and we may be the only alternate carrier on a route. The same is for Eagle and American Connection in the Midwest. If the mainlines have problems, small town America is going to suffer. That is the most consumer unfriendly result of the consequence of this DOJ action.
ST: Were there any TWU-specific concerns you mentioned at the meeting?
BG: From a labor perspective, there is two areas. One is other carriers, United and Delta specifically and Southwest have taken their maintenance overseas. This deal that we’re putting together with American and US Airways was saving maintenance-related jobs here in the United States and a stand alone carrier is going to have to try to find ways to reduce its costs. In both cases, we’re putting maintenance jobs at risk. These other carriers already have a cost advantage by sending their maintenance out of the country…and we were saving American jobs. Here we were doing the right thing and then the DOJ essentially through their action could cause their jobs to be lost….The other issue I brought up is, we, at the two airlines have the two oldest pilot populations in the industry. We are going to have hire aggressively but if we are perceived by pilots in the marketplace as a not attractive proposition, it puts us by having the lack of the long term staying power, that would put us at a distinct disadvantage of trying to attract pilots…We said that we felt the playing field has been changed and we were not being given a fair chance.
ST: Did the DOJ have any questions for the union leaders?
BG: They had questions to just expand upon some of the items we were saying and to understand what we were saying. For example the foreign maintenance information was new to them. They did ask us to explain that a little more, and again this was a very honest, open frank discussion where they really truly sounded like they wanted to hear what our opinion was.
ST: Do you think you changed the DOJ’s view of the merger?
BG: Our job was to present our viewpoint of what we thought the potential outcome would be with the DOJ actions and I think we delivered that message loud and clear. I won’t speculate on did we change minds and hearts but we were certainly passionate in telling our stories about what has happened to our employees. We know that American employees have taken concessions in 2003. The last time the DOJ did a stop a merger was our transaction with United-US Airways. We went into two Ch. 11 bankruptcies after that. Our point was that it might seem the industry is doing well financially right now but external forces can cause huge disruptions in the financial fortunes of these companies. Do not think just because the picture might be good right now that they may not change…If we’re weakened and kept out of this merger…We’ve seen Delta before with a very aggressive try to drive us out of the marketplace on the East Coast. I have no doubt that Delta will try to knock us down, to try to eliminate their competition and we certainly expressed our view of the world to the members of the DOJ that we met with. I was very pleased that we were able to express in an open format how we felt and how our employees could be adversely impacted by this decision on how our representative employees could be potentially harmed…Again, they’re looking not at the employee point of view but the consumer point but I think common sense would say you need to consider what will happen if American and US Airways become failed carriers because they aren’t able to compete. That is not good for a competitive landscape in the United States and will essentially cede to two dominant international carriers the international marketplace. That isn’t a good option.
ST: Do you think there is a chance for a settlement prior to the start of the antitrust trial?
BG: The assistant attorney general did mention they filed the suit in such a way that there really was no settlement that would be workable but he did indicate that they would always be open to a settlement. So when you’ve said in motion, this process can’t be settled then it’s probably false hope to think there is a settlement option. I wish I had clarity on that. We would hope that the DOJ would come to the realization because of the significant negatives for both employees and consumers that they would reconsider and withdraw or at least offer a reasonable settlement. Mr. Baer suggested there was a settlement option but that it would be very difficult for the carriers to provide that settlement.