binding TAC. Continental's spokesman further indicated that this item would likely be satisfactorily resolved if all other issues were resolved. At the September 30 meeting, ALPA representatives asked questions about the Emergency Work Rules but refused to make any proposals of their own, even when asked by Continental to do so. When Continental asked if ALPA would accept the wages and work rules which ALPA had recently agreed to for the pilots of bankrupt Braniff Airways, Continental was told that these terms would be unacceptable to Continental pilots. During the September 30 meeting Continental indicated its desire to avoid a strike. Despite these statements, ALPA representatives made no acknowledgement of an imminent strike threat and did not offer a single alternative or suggestion that might help avert the strike. At 2:00 a.m. on October 1, 1983, ALPA joined by UFA went on strike. Morning edition newspapers carried an ALPA advertisement relating to the strike. Pickets appeared at 7:00 a.m. at Houston Intercontinental Airport Terminal C carrying large signs. Continental believes that the signs and advertisements were prepared and placed prior to the commencement of "negotiations" on September 30, 1983. The first post-strike negotiations were held on October 6, 1983. Prior to this negotiating session Continental again asked ALPA to submit a proposal responding to the company's proposals. ALPA refused to state whether it would submit a proposal. At the meeting, ALPA again failed to set forth a proposal or counterproposal on any issue. At this meeting, Continental representatives presented an elaboration and clarification of the Emergency Work Rules and written information on group health insurance and the profit sharing and stock ownership plans. ALPA made no proposals of any type. The meeting lasted less than two hours, including multiple recesses. ALPA asked for another meeting the next day, October 7. Continental representatives asked if ALPA would have a proposal but, ALPA declined to answer. Once On October 7 Continental representatives met with the same ALPA representatives for several hours. again, ALPA representatives failed and refused to make any proposals. At the conclusion of this meeting, Continental representatives indicated they would not continue to meet in the absence of meaningful discussion, negotiations or counterproposals from ALPA. It was not until Friday, October 14, 1983, that ALPA presented a counterproposal and it called only for a temporary 7% pay cut that would mean senior captains temporarily reduce their salaries to $100,000 per year. ALPA's proposal would provide pilots a projected retirement of $60,000 to $100,000 per year; and, it would guarantee senior captains a salary of over $115,000 per year by 1985 plus profit sharing and stock plans which could raise that figure to more than $150,000 per year. Continental rejected this proposal. Upon commencement of the October 1, 1983 strike, ALPA instituted a number of strike-related activities, including acts of physical violence and intimidation against pilots failing to honor the strike call and attempting to report for work at Continental facilities. These actions are, in part, the subject of an antitrust suit filed by Continental against ALPA. Since commencement of the strike on October 1, ALPA has threatened to impose union fines in excess of $10,000 and discipline on pilot members who failed to honor the strike. Moreover, ALPA has induced pilots who wish to fly to join the strike by "extraordinary" strike benefits ranging from $3,800 to $2,800 per month; this amounts to more than Continental is able to pay these pilots. The recent events have been related in detail to illustrate that Continental is committed to recognizing ALPA and its other unions as the lawful bargaining agent. Management has simply been compelled by market forces to reduce costs across a broad spectrum which includes labor. I would point out in this regard that management has not been immune. Mr. Lorenzo reduced his salary from $257,000 per year to $43,000 per year from all corporate sources. has committed to maintain that salary level until Continental becomes profitable. Overall, management has been greatly affected by the 65% reduction in management head count, a 15% pay cut, a benefit package reduction (all Continental employees now receive the same benefit package) 7 day weeks He and 12-16 hour days. In fact, several vice presidents are no longer with the company having chosen not to remain with Continental under the circumstances. IV. CONTINENTAL HAS IMPLEMENTED PAY AND WORK RULE POLICIES THAT ARE RESPONSIVE TO TODAY'S ENVIRONMENT Continental has embarked upon a program to provide its employees the same kind of program that was offered before the Chapter 11 filing. Texas Air Corporation has donated 1 million shares of Continental Airlines Corporation common stock to be distributed free to all of the employees who work the month of October. A profit sharing plan and an employee stock ownership plan have been announced and, Continental is formulating means by which all employees can make an input to the corporate decision making process. With regard to union employees, Continental has adopted compensation and work rule packages which are very competitive in today's environment. Table I shows that, for example, Continental's compensation and work rule package for pilots meets or exceeds the contract ALPA signed with "new" Braniff this past June. Equally significant, Continental's proposal exceeds the compensation and work rule packages of the average new airline. Continental's initiatives are subject to bankruptcy court approval. However, they clearly demonstrate an intention to treat our workforce in a fair and reasonable manner. |
