SlumTodd_Millionaire
Most Hated Member
Not exactly impressive. The pay raises are okay. Signing bonus is about what you'd expect. Some new overrides that aren't bad. But retirement is a slap in the face. And I have a feeling that the members aren't going to be thrilled with those scope concessions. Here's the union update:
From Your Union Leadership
Over the last week your SWAPA board of directors has received briefings from the Negotiating Committee and subject matter experts, covering the entirety of the Agreement in Principle (AIP) and providing clarity toward its value. Each section was the subject of spirited debate to determine its potential impact on the careers of Southwest Airlines pilots. After four days of information and discussion, your board voted on Thursday afternoon that the membership deserved the opportunity to see and to vote on a Tentative Agreement (TA).
Over the next several weeks we will conduct roadshows at each domicile and some major overnight cities while also hosting virtual roadshows on the SWAPA website for your participation. A contract comparison is being mailed to your homes which will allow you to measure this TA against the yardstick of our various competitors. TA compensation and retirement calculators will also be accessible from the SWAPA website so that you can accurately assess the financial implications over the lifespan of the TA.
Major consideration points of this agreement include the following:
Pay Rates
Effective Incremental Cumulative / Compounded
At ratification 4.0% 4.0%
April 1, 2016 3.0% + 0.5% variable* 7.6%
April 1, 2017 3.0% 10.9%
April 1, 2018 3.0% 14.2%
April 1, 2019 3.0% 17.6%
Signing Bonus
~$125,000,000 bonus distributed based on pilot's individual earnings from September 1, 2013 through July 31, 2015. This computation is available on the TA calculator on swapa.org.
Profitability Bonus
1% pay bonus based on 15% ROIC in 2015 and 2016. (2015 bonus assured today re:current earnings)
Training Pay
Increased from 5.0 TFP to 6.5 TFP per day
Overrides
Near International 3%
Special Qualification Airports (ND) 5%
Red-eye (2 a.m. - 4a.m. domicile time) 3%
Classic (CD) 3%
Per Diem 2016 2017 2018 2019
Domestic $2.25 $2.30 $2.30 $2.35
International $2.75 $2.80 $2.80 $2.85
Reserve
Reserve pay will be calculated on a per-block basis effectively reducing the "sitting for free" problems we have experienced under our current contract. Daily Reserve Order is replaced with Reserve Callout Order (RCO). Under RCO, reserve pilots will be called out following a simple, easy-to-understand order: by "bucket" (length of reserve block remaining), then pass/fly preference, and then days of reserve already flown in the month. (Seniority will break ties at this point.) Enhanced trip ownership for reserves and more pilot-friendly release rules have also been negotiated.
Retirement
Company 401(k) matching contributions have been increased to 10%. Additionally, the 401(k) matching cap has been increased to $27,000 in 2016 and then by $500 each year thereafter to a maximum of $29,000. The Company also agreed to make profit sharing a contractual item (currently it is not and could be terminated or modified by the Southwest BOD at any time.) Improved investment options and flexibility have been added to retirement accounts. For the cumulative effect of the increased pay rates, match and caps on retirement, see the TA calculator on swapa.org.
Section 1
The TA would allow Southwest to enter into airline partnerships with important limitations and safety valves. Domestic codeshare remains prohibited. The Company may interline with foreign carriers (no domestic carriers) as long as at least one connecting flight is flown by Southwest Airlines aircraft. Section 1 effectively prohibits all airline partnerships unless they are specifically permitted. This "whitelist" approach provides critical protections from forms of codeshare, interline, or distribution that do not yet exist.
Near-international (the Americas) interline is allowed within strict Passengers Daily Each Way (PDEW) limits per market. If the PDEW is exceeded, the Company must end interline, reduce it below the cap, or meet with SWAPA to obtain approval to continue.
Far-international (overseas) interline is allowed with PDEW limits. East (Europe) and west (Asia) PDEW limits apply to all carriers and all markets to limit the total number of passengers Southwest can carry. As with near-international, if the PDEW is exceeded, the Company must obtain SWAPA's agreement to continue.
Divisions
Flight ops safety desires to divide certain higher-risk international flying along with the eventual drawdown of the Classic fleet. Divisions may be one of the following: Near International (ND), ETOPS (ED), Domestic (DD), Classic (CD), and MAX (MD). Any division of the fleet and pilot group has the potential to reduce our flexibility and harm our quality of life. Therefore, SWAPA negotiated limitations on the size and composition of divisions to defend pilot flexibility.
Conclusion
Our goal is to provide you with factual information regarding this contract and specifically how it will impact you. This will allow you to carefully review the agreement and cast your vote in the best interest of your families.
From Your Union Leadership
Over the last week your SWAPA board of directors has received briefings from the Negotiating Committee and subject matter experts, covering the entirety of the Agreement in Principle (AIP) and providing clarity toward its value. Each section was the subject of spirited debate to determine its potential impact on the careers of Southwest Airlines pilots. After four days of information and discussion, your board voted on Thursday afternoon that the membership deserved the opportunity to see and to vote on a Tentative Agreement (TA).
Over the next several weeks we will conduct roadshows at each domicile and some major overnight cities while also hosting virtual roadshows on the SWAPA website for your participation. A contract comparison is being mailed to your homes which will allow you to measure this TA against the yardstick of our various competitors. TA compensation and retirement calculators will also be accessible from the SWAPA website so that you can accurately assess the financial implications over the lifespan of the TA.
Major consideration points of this agreement include the following:
Pay Rates
Effective Incremental Cumulative / Compounded
At ratification 4.0% 4.0%
April 1, 2016 3.0% + 0.5% variable* 7.6%
April 1, 2017 3.0% 10.9%
April 1, 2018 3.0% 14.2%
April 1, 2019 3.0% 17.6%
Signing Bonus
~$125,000,000 bonus distributed based on pilot's individual earnings from September 1, 2013 through July 31, 2015. This computation is available on the TA calculator on swapa.org.
Profitability Bonus
1% pay bonus based on 15% ROIC in 2015 and 2016. (2015 bonus assured today re:current earnings)
Training Pay
Increased from 5.0 TFP to 6.5 TFP per day
Overrides
Near International 3%
Special Qualification Airports (ND) 5%
Red-eye (2 a.m. - 4a.m. domicile time) 3%
Classic (CD) 3%
Per Diem 2016 2017 2018 2019
Domestic $2.25 $2.30 $2.30 $2.35
International $2.75 $2.80 $2.80 $2.85
Reserve
Reserve pay will be calculated on a per-block basis effectively reducing the "sitting for free" problems we have experienced under our current contract. Daily Reserve Order is replaced with Reserve Callout Order (RCO). Under RCO, reserve pilots will be called out following a simple, easy-to-understand order: by "bucket" (length of reserve block remaining), then pass/fly preference, and then days of reserve already flown in the month. (Seniority will break ties at this point.) Enhanced trip ownership for reserves and more pilot-friendly release rules have also been negotiated.
Retirement
Company 401(k) matching contributions have been increased to 10%. Additionally, the 401(k) matching cap has been increased to $27,000 in 2016 and then by $500 each year thereafter to a maximum of $29,000. The Company also agreed to make profit sharing a contractual item (currently it is not and could be terminated or modified by the Southwest BOD at any time.) Improved investment options and flexibility have been added to retirement accounts. For the cumulative effect of the increased pay rates, match and caps on retirement, see the TA calculator on swapa.org.
Section 1
The TA would allow Southwest to enter into airline partnerships with important limitations and safety valves. Domestic codeshare remains prohibited. The Company may interline with foreign carriers (no domestic carriers) as long as at least one connecting flight is flown by Southwest Airlines aircraft. Section 1 effectively prohibits all airline partnerships unless they are specifically permitted. This "whitelist" approach provides critical protections from forms of codeshare, interline, or distribution that do not yet exist.
Near-international (the Americas) interline is allowed within strict Passengers Daily Each Way (PDEW) limits per market. If the PDEW is exceeded, the Company must end interline, reduce it below the cap, or meet with SWAPA to obtain approval to continue.
Far-international (overseas) interline is allowed with PDEW limits. East (Europe) and west (Asia) PDEW limits apply to all carriers and all markets to limit the total number of passengers Southwest can carry. As with near-international, if the PDEW is exceeded, the Company must obtain SWAPA's agreement to continue.
Divisions
Flight ops safety desires to divide certain higher-risk international flying along with the eventual drawdown of the Classic fleet. Divisions may be one of the following: Near International (ND), ETOPS (ED), Domestic (DD), Classic (CD), and MAX (MD). Any division of the fleet and pilot group has the potential to reduce our flexibility and harm our quality of life. Therefore, SWAPA negotiated limitations on the size and composition of divisions to defend pilot flexibility.
Conclusion
Our goal is to provide you with factual information regarding this contract and specifically how it will impact you. This will allow you to carefully review the agreement and cast your vote in the best interest of your families.
