US Airways Chief Executive Officer Doug Parker, who failed last year in his quest to take over Delta Air Lines, now faces an even greater challenge -- integrating the cultures and work groups of the old US Airways and the old America West Airlines even as dissatisfaction mounts among the carrier's 35,000 employees.
Twenty months after a merger of airlines based in the East and the West, the combined Tempe, Ariz.-based carrier lacks single contracts covering its pilots, flight attendants, mechanics and baggage handlers. All want payback for sacrifices through two bankruptcies at the old, Northeast-based US Airways and to benefit from the dramatic turnaround at the new US Airways, which was among the industry's most profitable last year with $303 million in gains.
Across the industry, the "labor issue is worsening," Mr. Parker said at the airline's annual shareholders meeting, held this year in Philadelphia, where the company employs 5,600, compared with 2,000 in Pittsburgh. "More and more," unions are "looking to get more and more back. That is causing more and more strife throughout our business."
Mr. Parker and his management team hope to have single contracts in place by the end of the year, thereby combining all planes and crews. But there are new signs that a complete integration of cultures from the East and West will be tricky.
Pilots from the old US Airways are still fuming over the decision made by a federal arbitrator to scale back their seniority rights upon merging ranks with pilots from the old Arizona-based America West. The seniority list determines who gets the best pay, routes and vacations.
US Airways pilots, as a group, are older than the America West pilots (although the two sides disagree by how much), and they argue that West pilots with fewer years at the helm are now in line to take higher-paid captain's seats currently held by the most senior pilots at the old US Airways, where the average age of pilots is 53, according to the union, compared with 46 at the old America West (the America West union claims the US Airways average is actually 49 if furloughed pilots are included in the count).
The seniority spat is scheduled to go before the Air Line Pilots Association's executive council on Monday, near Washington, D.C. The Eastern pilots will argue that the decision, made by a federal arbitrator, violates ALPA merger policy because it creates a "windfall" for one pilot group at the expense of another, according to US Airways pilots union spokesman Arnie Gentile, who said his group wants ALPA to "strike down" the award and send the case to a new arbitrator. The America West union initially opposed the executive council meeting, but it still plans to present its case next Monday, according to America West pilots spokeswoman Tania Bziukiewicz, arguing that the arbitrator's decision is final.
An ALPA spokesman was unwilling to say whether the council has the right to cancel the award. "How the council will deal with that case is not something I am prepared to predict," said ALPA spokesman Pete Janhunen.
In an attempt to mend relations between East and West, ALPA President John Prater told the old US Airways and America West pilots in a letter last Friday that "we need to listen to each other" if the union is "to create a unified, single pilot group capable of reaching a new agreement. ... If pilots decide to work at cross purposes, then we won't be in position to accomplish our mutual goals."
US Airways pilots certainly have not been shy about expressing their dissatisfaction.
The union recently paid for billboards in Philadelphia and Charlotte, N.C., advertising their "low morale" and many did not come to work the weekend following the arbitrator's May 3rd ruling. On Sunday, May 6, only 29 percent of the carrier's flights left on time, according to the US Airways pilots union. Asked whether pilots deliberately called off work or slowed flights due to frustration about the seniority ruling, Mr. Gentile said many pilots were simply not fit to fly that weekend.
"They didn't belong in the cockpit," he said. "They were that upset." But, at the same time, there was no "concerted effort" to disrupt the airline's operations, he added. "That would be against the law."