Airline Business Weaker Due to Delta Variant

Airline Business Weaker Due to Delta Variant

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Airline Business Weaker Due to Delta Variant

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While summer traffic has been promising, there are troubling signs that the profit season for airlines may have peaked early – due to the continuing Pandemic.

TSA bookings year over year show positive growth throughout commercial aviation. Compared to 2019, the year before the pandemic began to ravage airlines, today’s air traffic is 80% of what it historically should be for August. 

However, it may be too early to declare the pandemic behind us. With the Delta variant clogging hospitals with unvaccinated Americans, airline travel is showing severe signs of weakening. For the third straight week, airline bookings are down and far weaker than in 2019. System bookings are currently 53.8% lower than 2019 levels. That could show that the most profitable quarter for airlines may be shorter this year than the historical average. If the trend continues, many airlines will not have enough summer profits to get them through the rest of 2021 as they might have wanted. 

The cause of the general malaise within airlines can be attributed to the continued COVID-19 pandemic. 

Lucrative business and international travel is down at all airlines and show few signs of a quick comeback. Popular destinations for American air travelers, including France, remain on the CDC’s “Do Not Travel” list. Hawaii is restarting restrictions on travel to the islands, including group sizes. Several other resort destinations are asking visitors to leave as soon as possible, while others extend border closures. All of which are challenges that airlines do not need right now. 

Southwest attributed a general slowdown “close-in reservations” for August to the Delta Variant in an SEC filing last week. Delta, Hawaiian, Air Canada, United, and Frontier have imposed some vaccine requirements for employees. 

recent study of air travelers conducted by Longwoods International is not helping relieve fears of long-term, pandemic-related slowdowns for air travel. According to the research, a shocking 67% of communities want to shut their doors to tourists and their money. This number is high and growing; two months ago, it was at 47%, an already incomprehensibly high figure for areas dependent on tourist revenue. The study also found other indicators that COVID-19 concerns are a serious threat to aviation. 

30% of respondents reported that they would rather drive instead of fly to their next travel destination, with 25% choosing domestic rather than international travel. The number that said COVID-19 concerns would “greatly” impact their travel decisions over the next six months was a staggering 34%. 

If all these indications of weakening air travel demand are accurate, airlines may have hit the high point of their profit season. 

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Hawaiian Airlines Negotiations Update

Hawaiian Airlines Negotiations Update

Aloha Sisters and Brothers of Hawaiian Airlines,

A couple of weeks ago, we informed you that we would advise you of any new developments with Hawaiian Airlines and the scheduling of negotiations. Last night we confirmed with the carrier that we will meet the week of August 29th in San Francisco, California. We, along with your negotiating teams, remain cautiously optimistic that we can reach a tentative agreement during that session that will recognize and honor the work you do and the value you deliver to this company. 

Together, we can secure an outstanding contract on your behalf and avoid the need to enter into Section Six negotiations.

On a separate note, Hawaiian Airlines has informed us that they plan to follow United Airlines and mandate the vaccine for their employees. Although morally we don’t agree with a mandates-only approach to the Covid-19 vaccine, our attorneys have advised us the carriers are within their legal right to mandate the vaccine. 

Employees with specific disabilities and sincerely held religious beliefs may have additional legal rights that employers must respect. The EEOC can offer further guidance and legal assistance. 

 

We continue to thank you for your support and solidarity.

 

Mike Klemm

President and Directing General Chair, District 141, International Association of Machinists and Aerospace Workers

Dave Supplee

President and Directing General Chair, District 142, International Association of Machinists and Aerospace Workers

Please print and post on all IAMAW bulletin boards.

 

141 Report: Interview with Mike Klemm, PDGC of District 141

141 Report: Interview with Mike Klemm, PDGC of District 141

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Dave Lehive gets District 141 President and Directing General Chair Mike Klemm on record with updates and news on negotiations, COVID recovery and vaccinations, and other hot topics. This 141 Report is a must-see! 

141 Report: Interview with Mike Klemm, PDGC of District 141

Dave Lehive gets District 141 President and Directing General Chair Mike Klemm on record with updates and news on negotiations, COVID recovery and vaccinations, and other hot topics. This 141 Report is a must-see! 

We begin with Mike telling his story about how he “grew up” at JFK Airport in New York City and first became a Shop Steward at Local Lodge 1322 in 1999. He was elected Grievance Committee Representative two years later, and in 2006 won election as Committee Chair for JFK and LGA. He was later elected Assistant General Chair of District 141, becoming President and Directing General Chair in 2015. 

The conversation goes right into contract negotiations, beginning with the successful joint collective bargaining agreement signed with American Airlines 18 months ago. That agreement raised the bar for wages, benefits, and work rules for the entire airline industry, earning the highest rate of approval for ratification of any contract in the history of District 141. 

Assistant General Chair Tony Gibson is leading negotiations with Spirit Airlines, seeking improvements to the first contract reached with that carrier. The process is expected to continue through the fall. 

We move on to Hawaiian Airlines, where ongoing expedited negotiations are modeled after the successful process that was used with United Airlines in 2016. Delays due to COVID restrictions have slowed down the process, and both sides differ on key issues, such as wages, benefits, job protections, and scope. Mike is looking forward to a quick resolution at the next scheduled meeting in the next 4 to 6 weeks. If an agreement is not reached, the union will end expedited negotiations and will proceed to negotiations per Section 6 of the Railway Labor Act, which sets the legal framework for collective bargaining in the airline industry. 

United Airlines presents the biggest challenge to successful negotiations because of the airline’s business model, which relies heavily on business and international travel – two areas that have been the slowest to see a post-COVID recovery. United is still operating fewer flights and offering lower fares than in 2019, although executives predicted a return to profitability in the third and fourth quarters of 2021. These factors, along with the new executive leadership at the airline, require a careful assessment of conditions before jumping into a full negotiations process. The negotiations were paused in 2020 due to COVID restrictions, and to dedicate resources to protecting jobs and scope during the pandemic. 

Mike reminds us that United enjoyed the highest profits in its history before the pandemic thanks to the hard work and dedication of Machinists Union members. District 141 plans to survey members before deciding if expedited negotiations are still the best alternative to reach an industry-leading contract that rewards that hard work. Negotiators will evaluate how many issues need to be addressed to have a more defined agenda before a planned meeting with United negotiators in the fall. 

Klemm also comments on United’s policy announced today that will require all US-based employees to be fully vaccinated against COVID by October 25, 2021. As an incentive, the company is offering a paid day off for employees who upload vaccination records to the United intranet before September 20, 2021. 

Today’s announcement reverses Kirby’s statement he made in January of this year when he said, “I don’t think United will get away with and can realistically be the only company that requires vaccines and makes them mandatory. We need some others…to show leadership, particularly in the healthcare industry.” District 141 stands by the position shared with members at that time, encouraging incentives, not mandates. “We expected better collaboration between United’s executives and the airline’s unions on this critical issue. Clearly, we are working with a different regime, the Oscar Muñoz style of management is over,” said Klemm.

In related news, contract negotiations with Flagship Facility Services in SFO progressed quickly under the leadership of AGC Troy Rivera and members there ratified a contract in June. 

Brother Mike Klemm leads the largest district in the IAMAW, which has doubled its membership numbers since 2008, when most of the executive board members took office. Yet, the leadership is focused on the needs of every member and returns every call and answers every email. The efforts of district officers to date have saved the jobs of 29 members who were wrongly terminated in 2021, with 1,200 jobs saved since 2008. They have also won over $190,000 in bypass and back pay in 2021, and close to $3 million since 2008. 

Dave and Mike describe how every department in the District serves an important function for members, from Safety to Education, Legislative and MNPL, Community Service, and EAP.

During Klemm’s tenure, he has led a team that has implemented the GSAP safety program at American, has made member education available to all locals, has increased fundraising to support our allies in elected office, and is currently expanding community service programs so they serve the needs of the communities where our members live. The Employee Assistance Program serves members facing many mental health issues besides alcohol and drug abuse that have become more prevalent during the pandemic. And the Communications team keeps everyone informed because an informed union member is a powerful union member. 

Finally, Mike and Dave speak about the importance of organizing and how it relates to everything District 141 does. Non-union carriers like jetBlue and Delta spend millions every year to keep out unions because they know we will negotiate a seat at the table, respect, and a better quality of life for workers. When we negotiate contracts, they set a higher standard for non-union workers as well. 

“Could you imagine how powerful we would be if everybody in the airline industry was in a union?” asks Mike, in a call to action. 

There’s no time to waste, we have work to do. 

Hawaiian Airlines Negotiations Update

Hawaiian Airlines Negotiations Update

Aloha Sisters and Brothers of Hawaiian Airlines,

Last month, we informed you that we were planning a high-level executive meeting between the IAMAW and Hawaiian Airlines the week of July 19, 2021, to discuss the outstanding issues that required more work. These issues included economics, benefits, job security and scope. Although the meeting took place it didn’t bring us to the tentative agreement we had hoped for at the beginning of the week. Only a tentative agreement that recognizes and honors the work you do, and the value that you deliver to this company will suffice under this limited issue, expedited negotiation process.

Although not the outcome we were looking for, we did make enough progress to schedule another session with the goal of reaching an agreement. Once we have confirmed those dates, we will be sure to communicate that to our Hawaiian Airlines members.

In closing, thank you for your support and solidarity. Together, we can secure a great contract on your behalf and avoid the need to enter into Section Six negotiations.

In solidarity,

Mike Klemm

President and Directing General Chair, District 141, International Association of Machinists and Aerospace Workers

Dave Supplee

President and Directing General Chair, District 142, International Association of Machinists and Aerospace Workers

Recording Secretaries: please print and post on all IAMAW bulletin boards

    RELATED ARTICLES

Hawaiian Airlines Negotiations Update

Hawaiian Airlines Negotiations Update

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Hawaiian Airlines Negotiations Update

Aloha Sisters and Brothers of Hawaiian Airlines,

In April, we informed you that we would begin meeting with Hawaiian Airlines to continue limited issue, expedited negotiations. We have made good on that promise, and are working on a contract that will recognize and honor the work you do, and the value that you deliver to this company. 

Your committees have already made encouraging progress on many priority items. However, there are still a few issues that require more work. These issues include economics, benefits, job security, and scope.

To resolve these remaining issues, we are planning a high-level executive meeting between the IAMAW and Hawaiian Airlines in Las Vegas, scheduled for the week of July 19, 2021. We are hopeful that we can come to an agreement on the remaining items and deliver a final Tentative Agreement to you.

In closing, thank you for your support and solidarity. Together, we can secure a great contract on your behalf and avoid the need to enter into Section Six negotiations.

In Solidarity,

MICHAEL KLEMM,

President & Directing General Chair,
District 141,
International Association of Machinists & Aerospace Workers

David Supplee,

President & Directing General Chair,
District 142,
International Association of Machinists & Aerospace Workers

Recording Secretaries: Please print and post on all IAMAW bulletin boards.

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Hawaiian Airlines Negotiations Update

Hawaiian Airlines Negotiations Update

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Hawaiian Airlines Negotiations Update

Dear Sisters and Brothers,

We hope this communication finds you safe and healthy. As you are well aware, we had suspended negotiations due to the pandemic and associated travel and meeting restrictions. We are pleased to announce that we have agreed with the Company to resume negotiations beginning the first part of May 2021.

Our position will be to pick up where we left off in March 2020. We recognize your hard work and sacrifices during this very trying time. We will make sure that Hawaiian Airlines also recognizes this fact. You have contributed greatly to HAL being able to successfully navigate through the last several months and fully deserve to share in that success moving forward.

In closing, thank you for all you do. It is with your support and solidarity that your Negotiating Committee will be able to secure a great Contract on your behalf.

In Solidarity,

 
 

Mike Klemm

PDGC, IAMAW District 141

David Supplee

PDGC, IAMAW District 142

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