Merger/aquisition
Thread Starter
Joined: Mar 2006
Posts: 71
Likes: 0
From: warmplace
Merger/aquisition
Anyone care to comment on integration of seniority lists when 2 companies become one or when one takes over another? for example AA/TWA or US Airways/Airtran...any comments at all much appreciated.
regards
regards
Joined: May 2000
Posts: 510
Likes: 0
From: New York
It's US Airways and America West, not Airtran. As far as who took over who, that's open to considerable difference opinion. My own is that US Airways was already through several BK's as the result of completely incompetent and greedy CEOs and was the weaker of the two companies. It may be called US Airways, but the surviving management and real company is America West.
Every integration is unique. If both carriers are covered by the same parent union, then there is likely a standard framework to negotiate an integration, probably with arbitration as the end game. In the US Airways/America West, both parent unions are ALPA. In the case of AA and TWA, the unions were not affiliated, therefor it was much more complicated. In this case, TWA was in severe financial condition and likely not to survive. As a condition of asset purchase (it was not a "merger"), the TWA unions were forced to forfit any power to dictate integration conditions. Don Carty (of the infamous Canadian Carty Bros. airline wreckers) promised a "fair" integration (whatever that meant), however, he had no authority or power to fulfill it, just as everyone knew at the time. If the TWA unions had refused, the asset purchase would have likely been stopped and the company probably liquidated in full bankruptsy, which is why the TWA unions acquiesed. The AA pilot's union had been through several unwanted integrations previously and feared that AA would do the same thing they usually did . . . buy a company, force a messy employee integration, then get rid of airplanes and be stuck with the extra employees to fight out seniority issues. The APA was in a position of superiority to dicate the integration agreement which resulted in about 800 of the 2300 TWA pilots being integrated into the APA list, which the rest being stapled to the bottom of the list.
Unfortunately, in the case of the TWA asset purchase, this was again true that the acquired airline was virtually eliminated. At the time of purchase it was obvious that the US was going into recession, but then the September 11th massacres in NY caused massive layoffs.
Every integration is unique. If both carriers are covered by the same parent union, then there is likely a standard framework to negotiate an integration, probably with arbitration as the end game. In the US Airways/America West, both parent unions are ALPA. In the case of AA and TWA, the unions were not affiliated, therefor it was much more complicated. In this case, TWA was in severe financial condition and likely not to survive. As a condition of asset purchase (it was not a "merger"), the TWA unions were forced to forfit any power to dictate integration conditions. Don Carty (of the infamous Canadian Carty Bros. airline wreckers) promised a "fair" integration (whatever that meant), however, he had no authority or power to fulfill it, just as everyone knew at the time. If the TWA unions had refused, the asset purchase would have likely been stopped and the company probably liquidated in full bankruptsy, which is why the TWA unions acquiesed. The AA pilot's union had been through several unwanted integrations previously and feared that AA would do the same thing they usually did . . . buy a company, force a messy employee integration, then get rid of airplanes and be stuck with the extra employees to fight out seniority issues. The APA was in a position of superiority to dicate the integration agreement which resulted in about 800 of the 2300 TWA pilots being integrated into the APA list, which the rest being stapled to the bottom of the list.
Unfortunately, in the case of the TWA asset purchase, this was again true that the acquired airline was virtually eliminated. At the time of purchase it was obvious that the US was going into recession, but then the September 11th massacres in NY caused massive layoffs.
Last edited by Roadtrip; 19th December 2006 at 03:07.
Joined: Feb 2000
Posts: 983
Likes: 0
From: with the porangi,s in Pohara
Roadtrip.....if it please,s the courts.......staple the USAirways pilots on the bottom of the AWA pilots list.....their latest presentation to the mediator on their DOH(date of hire) was nothing short of pathetic...PB
