Feb. 02, 2006 - 19:00 MST

AS USUAL

Big headlines about United Airlines coming out of bankruptcy. But there is a lingering side effect of the state of company affairs that lingers. There is an article in yesterday's Rocky Mountain News by Joanne Kelley of that paper nestled in a crook of the big article's elbow. Quoted in full:

MORALE RUNNING ON FUMES

Executive rewards threaten to diminish standards of service

"As United Airlines makes a comeback from bankrptcy today, the company has yet to address one of its biggest challenges: battered employee morale.

Still reeling from deep pay cuts and lost pensions, the carrier's remaining workers learned two weeks ago that executives and managers will collect big cash and stock rewards upon the company's exit from bankruptcy."

Workers, retirees and labor experts alike say that the financial package for top brass has only further alienated frontline workers at a time when the company needs to pull together to stay afloat in the long run."

"I'm amazed the court allowed all that," said Clarence Craver, labor and employment law professor at George Washington University in Washington, D.C. "I'm afraid it's the American way. We're seeing a trend where everybody's looking out for people at the top."

"Even the bankruptcy judge who approved the plan in January admitted as much."

"It may very well be that we have a culture in this country that over pays management . . . but United is just one enterprise that functions in that environment," Bankruptcy Judge Eugene Wedoff said as he backed United's proposal."

"Labor experts question the logic of a ruling that suported the executive compensation plan. They say it will damage most among the workers who deal directly with customers and have the most influence on whether they keep flying with United."

"It's very corrosive," said Harley Shalken, a professor specializing in labor issues at the University of California at Berkeley. "It really poisons the atmosphere."

"Flagging worker morale ranks right up there with the high cost of fuel as the two key obstacles to United's success."

"Morale is central," Shalken said. "This is a service industry, and low morale diminishes service."

"United maintains its employees are performing better than they were before the bankruptcy. On Tuesday, United CEO Glenn Tilton even met with pilots returning from furlough, in part to assess their morale."

"One of the things we've seen over the course of bankruptcy is that the performance of our employees gets better and better, and we see that continuing," United spokeswoman Jean Medina said."

"Still workers -- who have given up billions of dollars in wages and benefits -- expressed dismay about the big stock payout going to management."

"It certainly looks like it has come off the backs of the employees who've given and given and given," said Capt. Herb Hunter, a pilot and spokesman for the United chapter of the Air Line Pilots Association. "The morale issue I believe is out there. I know it's out there."

"A retired United pilot had sharper words for management's plan to give away 8 percent of the stock in the newly reorganized company to 400 managers."

"They walk away from this with what I consider to be an outrageous amount of money," said Roger Hall, who is president of a retired pilots' group. "To me it seems as if that's their reward for having screwed retirees and employees. I can't help but feel bitter about it."

Medina recently said the management incentive plan is "consistent with United's overall philosophy to place a substantial portion of management employee compensation at risk and tied to the performance of the company's stock."

"Craver, the law professor who wrote the book Can Unions Survive ?, said he doesn't buy the argument that United needs to reward managers to retain them. With most airlilnes suffering, there's lilttle incentive to jump ship," he said."

"Instead, he called it a case of "unbridled greed."

"Added Berkeley's Shalken: "It's not like they were making money hand over fist and your've got to hang on to these people. These are the people who flew the airline into the side of a mountain. You've got people who've clearly demonstrated an inability to make money."

"Sara dela Cruz, a spokeswoman for the United flight attendants' union, which has been among the most outspoken critics of UAL's management pay levels, said executives "certainly have not contributed to United's success with the way they've treated employees."

A United flight attendants starting salary has been cut to $15,500 a year, down from $19,000 in 2002. By contrast, Tilton could get $59 million in stock under terms of a post-bankruptcy pact."

"With 12 years of experience, a flight attendant makes about $31,000, compared with $39,000 three years ago."

"The officers of the company have rewarded themselves handsomely in bankruptcy, while workers have taken cuts and sacrifices," Shalken said. "it's as if the captain was the first to get in the lifeboat, not the one who goes down with the ship."

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So if a "newby" flight attendant worked 40 hours a week, 52 weeks a year they would be getting $7.45 an hour and if a flight attendant with 12 years of experience worked the 2080 hours per year for their yearly wages of $31,000 it would figure out to $14.90 an hour. Twelve years and $14.90 is not a princely sum for anyone. When I retired as a shop employee in 1990 I was making over $13 an hour. Makes me wonder how the flight attendants survive until they get a bit of seniority under their belt ? And even at twelve years seniority they can't be living too high.

It grates on me that a company that has been cutting down its employees for many years, went into bankruptcy, still cutting wages and benefits and pensions, can and will with the approval of a Bankruptcy Judge reward themselves so richly for cutting enough wages, salaries and pensions that finally United comes out of bankruptcy and thereby they seem to think they deserve royal rewards. Oooooooh, good boy, finally you are out of bankruptcy, go to the jam jar and slather that stuff on your sandwich and top it off with caviar.

In the article I just quoted it says that CEO Glenn Tilton's incentive plan will be in the neighborhood of $59 million. Fifty damn million dollars, I think that is disgraceful.

And the bankruptcy judge seems to think that is the way the biggies should be treated. Seems to me that CEOs and their crews should give up big bucks when the company is not doing good. The worse off the company the more they should sacrifice. Might give them an incentive to run a successful company rather than ride the slippery slope to ruin.

It is becoming obvious to me that the working man, and I use that term loosely, perhaps the journeymen of their trades are descending into poverty due to the greed of the owners and stockholders of the various companies and corporations.

Dunno, looks as if the year 2006 it will be the same dirty business AS USUAL . . . . . . . .

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