United Airlines AFA MEC Website

Association of Flight Attendants-CWA United Master Executive Council

Operational Merger Process

Date: October 1, 2010
Type: AFA Article

On May 3, 2010 United and Continental announced a merger. Mergers are complex transactions with various steps to complete prior to an operational integration. This information includes the steps that would lead to an integrated Flight Attendant operation.

Shareholder Approvals

September 17, 2010 the Shareholders of each airline approved the merger.

Government Approvals

August 27, 2010 the Department of Justice (DOJ) approved the United/Continental merger.

September 2, 2010 the airlines announced the new United will submit a plan to the Federal Aviation Administration (FAA) for approval of a Single Operating Certificate - retaining the Continental operating certificate and the United repair station certificate. Currently, United and Continental each have an air carrier certificate and a repair station certificate. Continental Micronesia currently has a separate operating certificate. United’s plan is to combine Continental Micronesia with Continental under one operating certificate in advance of the integration between United and Continental.

Once a plan is approved by the FAA it could take up to 15-18 months for finalization and award of a Single Operating Certificate (SOC). Executives expect the SOC to be awarded by the FAA in the first half of 2012.

Objections

September 28, 2010 – all legal objections dismissed from court. 

Merger Transaction Close

October 1, 2010 the merger transaction closed and the new United Airlines was established. The operational merger is critical for the "synergies" that executives tout will produce $1 billion cost savings and revenue generation by 2013.

"In order to get the synergies and cost benefits, you really have to go to a single entity," said airline consultant Robert Mann at RW Mann & Co in a September 29, 2010 Reuters article.

The incentive for executives to achieve an operational merger creates leverage for us in negotiations for a single Contract - where we work together with former Continental Flight Attendants to create the industry’s leading Flight Attendant Contract for all of us.

Representation

In a merger where two different Unions represent the same craft or class of workers and each of the Unions represent at least 35% of the combined work group; typically there is call for a representation election. In order for the election to move forward the National Mediation Board must first make the determination the new company qualifies as a “single carrier.”

Application for NMB Single Carrier Determination

After the merger transaction closes and the new United Airlines is established, the Unions may file an application with the National Mediation Board (NMB) seeking an investigation to determine whether the new United is a “single transportation system.”

There are numerous criteria used to determine this including:

·         published combined scheduled or combined routes;

·         standardized uniforms;

·         common marketing,

·         markings or insignia;

·         integrated essential operations such as scheduling or dispatching;

·         centralized labor and personnel operations;

·         combined or common management corporate officers and board of directors;

·         combined workforce; and

·         common or overlapping ownership.

It may not require each of these criteria to be met prior to the NMB making a single carrier determination. AFA will file an application for an investigation when we believe there is sufficient evidence for the NMB to determine the new United is a single transportation system.

During the NMB’s investigation – conducted on a case-by-case basis for each individual work group - AFA remains the certified representative of the United Flight Attendants and continues to administer the United Flight Attendant Contract.

Single Carrier Determination – Single Transportation System

Following an investigation, the NMB finds that the merger of United and Continental has created a single carrier. Once this step is completed AFA-CWA will file an application for a Union representation election, including the combined United/Continental Flight Attendant workforce.

NMB Representation Election

The NMB establishes an election period including dates for the tally and final count. Preliminary discussions with the NMB indicates the agency is aware of issues unique to international mail and potential remedies to provide for smooth voting procedures in all locations. Balloting instructions will be sent by the NMB to the Flight Attendants’ home address on file with the airline. The NMB typically conducts an electronic voting process.

Certified Bargaining Representative

If a majority of Flight Attendants make the decision to retain our representation in the Union of Flight Attendants and for Flight Attendants, AFA wins the election and becomes the certified bargaining representative for the new United Flight Attendants. AFA would administer both pre-merger Contracts separately for each group, with Flight Attendant representatives from each pre-merger airline, until a single Contract is negotiated. With AFA as the representative, our Contract goals are determined by all Flight Attendants through new surveys and our negotiations are focused solely on Flight Attendant issues. The Negotiating Committee would include representatives from each pre-merger airline and this committee would work with our professional negotiators, attorneys and other advisors to achieve our collective goals for improvements in a new single Contract.

Seniority Integration Process

Review this process here.

New Single Contract Negotiations

A review of negotiations is available here. Once negotiations conclude with a Tentative Agreement, the combined Flight Attendant AFA Members will vote on ratification of the new single Contract.

One Contract / One Seniority List

AFA holds the combined seniority list, reviewed by all Flight Attendants in the combined workgroup, until a new Contract is negotiated and ratified. Management is encouraged to work with us for a new single Contract in order to complete the operational merger with the integration of Flight Attendant operations with the combined seniority list.

Merger home page

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