Power Breakfast: Southwest-AirTran labor wrinkles, Georgia Power, Coke, Gwinnett airport, Delta, Braves, retail sales

Melding labor groups in airline mergers is never easy — and the Southwest-AirTran combo is likely to be no different.

Southwest plans to take over AirTran’s operations in Atlanta and base the combined company at its headquarters in Dallas. About two-thirds of AirTran’s 8,000 employees are based at its Atlanta flight hub, AJC staffer Kelly Yamanouchi reports.

Southwest CEO Gary Kelly said that “people may have to change locations, people may have to change jobs.”

AirTran pilots, flight attendants, mechanics and others are likely to get higher pay at Southwest, but in the meantime their unions must work out contract issues and seniority list integration — always a thorny topic with airline workers, since seniority affects pay, benefits and scheduling, Yamanouchi writes.

“There’s so much at stake in terms of their salaries,” said Barry Hirsch, a professor specializing in labor economics at Georgia State University. Pilots and flight attendants have complex contracts because of the intricacies of airline crew scheduling, he noted.

About 83 percent of Southwest employees are represented by unions, while that figure is about 50 percent at AirTran, including pilots, flight attendants and mechanics, Yamanouchi reports. So the deal is likely to lead to increased unionization among AirTran employees as they join Southwest’s unions.

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22 comments Add your comment

carolyn williams

October 6th, 2010
6:51 am

any business merger is difficult. it seems to me, ajc and you, mr. unger are trying to exploit the union piece of this story. amazing how we tend to forget that it is unions that brought us the 40 hour workweek, child labor laws, etc. employers join together via the chamber of commerce, why should workers not join together to ensure their issues are addressed as well. the workers at air tran and southwest will make their own decision. my hope is that those employees who have not joined the union will understand that they are far stronger standing together rather than believing that companyies/corporations will look out for their best interest.

TnGelding

October 6th, 2010
7:11 am

More pay for working folks has to be a good thing. I don’t see any animosity on either side. LUV has good employee relations and is a fun place to work. Can’t wait to try one of their flights to Vegas!

Bob

October 6th, 2010
7:12 am

Enter your comments here

shadow7071

October 6th, 2010
7:26 am

Ms. Williams, visit Walmart and tell me how many products are made in America. Visit Macy’s and tell me how many products you find that are made in America. Visit Target and list the number of products made in America. I think you and I and all the readers of this Biz Beat already know the answer. There are very few products made in America and one of the reasons is unions. Beginning back in the 1970’s with the textile industry, unions and business have not been able to agree, to work together. The result has been that business has moved jobs off-shore. These former workers or now un-employed or under-employed. Please explain to me and all of these displaced workers how the union has looked out for their best interest. Please explain to me and the readers why I can’t buy American made products at Walmart, Macy’s or Target.

Laurie

October 6th, 2010
7:34 am

Southwest has never had an issue before in combining staff, so I’m not sure the point this article is trying to make.

taudawg

October 6th, 2010
7:40 am

What’s funny, well, sad about the whole labor union issue is that the labor union issue is what drove AirTran to this. Delta faces a vote on going union. What is funny is that unions are basically what drove Northwest down. No way Delta would have survived to this point if it had been unionized. They would not have had the flexibility to do what it needed to do to continue doing business. Seriously, what good is making the union leaders richer if your company goes out of business? Does anyone seriously think that in today’ business climate, that unions are a positive influence on anything. Except of course, making a living for the union?

Light

October 6th, 2010
7:47 am

Let God will be done thru this blog http://lightoftheearth.blogspot.com

Dukester8

October 6th, 2010
8:03 am

The problem is corruption at the top from both sides. I have worked for union and non-union companies in the trucking industry. For most employees its about a living wage and respect from their employeers. For employeers is about profit. The only leverage employees have is being unified. You folks kill me. You all know good and well that a house divided will fall. Do I believe pilots should make 250,000 a year I dont know! Do I believe a baseball player should make 25 million I dont know that either. But I can say if the owner has a product and I am a “professional” (For the unwise that means not many people can do my job). I should be payed accordingly, whatever we agree on! What is an airline with out pilots? No one complains when i come through LAX and Delta has 2 counter workers to check in its outrageous bag fee and the line is so long I miss my flight. Bring on Southwest and like always the market will take care of itself with unions or not.

James Hoffa

October 6th, 2010
8:18 am

Shadow, you can’t find anything made in America anymore because profit margins have replaced people. It’s no mystery that of you replace an American worker that requires $10.00 per hour plus bennies (bringing the actual cost to $25.00 per hour and wants a 40 hour 5 day work week, with Lu Chen who will work 6.5 days a week. 12 hours a day at $1.50 a day, live in a box and wouldn’t even dream of health insurance, you will make a VERY good profit.

Now, if we could get the average American worker to adopt Lu Chens lifestyle, there would be plenty of jobs available. Or, we as Americans can stop trying to buy everything on the cheap and pay a reasonable price for a product made here at home. Unfortunately, I haven’t heard one person say that they are willing to to embrace either scenario.

Jason

October 6th, 2010
8:26 am

Funny how it is the heavily unionized Southwest that is in the strong position to buy out weak AirTran, a company that is only partially unionized. Shouldn’t it be the other way around if unions are the alpha and omega of evil and the death of all business they touch?

JD

October 6th, 2010
9:03 am

As long as the union’s goal is to work together with the company in order to do business, unions and employers can coexist. When the union tries to gain influence and power by convincing its members that they really have a bad deal (whether they do or not) and the union can get them everything they want, then things begin to get ugly. I saw a company go from having good relations to being nearly torn apart. The management hadn’t changed, but the union went from working with the company to working against them.

winkasdad29

October 6th, 2010
9:14 am

I am so sick and tired of hearing that unions are the reason for high prices and lack of American goods available for purchase. In the American South, there is this misconception that unions are evil, and that they stop businesses from competing. I’ve been in my union for almost 30 years. We have been on strike twice – in 1983 for about 10 days, and in 1986, for a month.

I look at being a union member this way: I am a player, the union is my agent – they negotiate my contract. Once the company and the union agree, the contract is signed – by both parties. Then we do business based on the rules set forth in the contract.

No one twisted the company’s arm to sign the contract. Companies are smart enough to know what will work for them and what won’t. My company is making money, hand over fist. I want the company to be successful because I want to continue to be paid well. My contract ensures I will be paid according to what was agreed on, that I will have a safe workplace, and that I will be treated with respect. What’s wrong with that?

Grow up

October 6th, 2010
9:19 am

At James Hoffa:

You need to grow up. You sound like a stinking teenager. “Profit margins have replaced people.”

Is a business a jobs progam or an enterprise in search of a profit?

It seems to me that you are one of the millions in the country that just doesn’t understand the idea of comparative advantage.

The bottom line is that America is no longer the most efficient producer of many of the consumer items on the market today. Telling Americans that we should all pay higher prices so that a less efficient labor force can be employed is juvenile.

VC32

October 6th, 2010
9:45 am

It is so funny how people think that Southwest is going to bring so much change. Atlanta already has low fares with Airtran, and usually Delta matches these low fares.The average Southwest fare is more then Delta and Airtran on most routes. It is the perception that Southwest has a lower fare…they are a low cost base airline not low fare. So go on and enjoy your flight to Vegas with no entertainment I will stick to my Delta flight with inflight entertainment.

Reef

October 6th, 2010
9:56 am

Grow up, you need to wake up. The rising wage gap between top-earners and the middle class occurred with the weakening of unions. Kudos to Southwest and their unionized employees.

Terminus

October 6th, 2010
10:09 am

Funny no one here has mentioned the Airtran employees and how they will be impacted!!

Reality

October 6th, 2010
10:11 am

Miidle class? Is there such a thing any more? The republican agenda is working perfectly.

1. Give big busineses huge tax breaks and bail outs. Claim that this is to ‘create’ or ’save’ jobs but really it results in huge bonuses for the CEO, Board of Directors, and other top management. Allow them to cut jobs in the US and ship others overseas to increase profits for the wealthy stock holders. Be sure to save those banks and wall street financial companys!

2. Refuse to allow for any help at all to the middle class. Hold middle class tax cuts hostage in Congress – try to force upper class tax cuts along with it.

3. Reduce/eliminate any ’safety net’ for the middle class workers that do lose their jobs – forcing them into the lower class. Stop the unemployment support, job seeker programs, college tuition help, etc.

4. Blame the democrats for spending to ensure that no federal or state money is spent to help the middle class. We won’t mention our over-spending on the military or how much it costs us to give those big buisnesses tax breaks or the most wealthy tax breaks.

5. Rake in the cash donations from the big buisnesses and the most wealthy so that we can get elected or re-elected.

BWAHAHAHA! We shall rule the Country!

Robert

October 6th, 2010
10:16 am

For years and years, Southwest has wanted to get into the Atlanta market. Savvy airline customers have wanted this for years, too. But alas, Delta swung its weight around, pressuring the Atlanta government agencies to not allow Southwest in.
Well, lookie lookie. Southwest has made it. It took them buying another airline, but WELCOME TO ATLANTA, SWA! I can’t wait to be able to enjoy your top-rated service and lower-than-anyone-else fees. The people of Georgia should be dancing in the streets now … SWA is here!

Terminus

October 6th, 2010
10:30 am

Like I said, what about us? Whats going to happen to us?

Les W. Moore

October 6th, 2010
11:05 am

It’s comical when some cry about Republicans and big business. Folks, who has Obama been taking care of for the past 20 months? Not you. Not me. Not small business. In fact, the entire middle is being snubbed by the regime. Bailouts for GM and Chrysler. Bailouts for Goldman, Citi, and all the too large to fail Wall Street bankers. Nothing for your community banks.

Drive down the road. How many small retail shops and small bsuinesses have closed since 2008?

Wake up folks. The hog is about ready to be slaughtered.

shadow7071

October 6th, 2010
12:19 pm

Once upon a time America was the goose that laid the golden egg. For the most part we all prospered. Then we got greedy. Unions wanted more share of the egg because the provided the labor. Management wanted to keep more of the egg because they owned the factors of production. Government wanted more share of the egg because they wanted to provide more services to the citizens. Soon there was not enough egg for everyone. Then, to make matters worse, investors (not just the big shots but all of us with 401K’s) demanded more and bigger eggs. In the end we’ve all killed the goose and now we’re fighting over it’s carcass.

greed is good

October 6th, 2010
12:58 pm

Unions didn’t drive jobs offshore. Unrealistic profit expectations of investors did. It is not enough to make a profit every month but the expection is to increase the profit margin quarter after quarter, something very difficult to consistently do. So after you work your American employees to the maximum level and you can’t seem to increase your profit margin any further, you relocate your headquarters offsees and you employ foreign workers. That helps in the short term and everyone (owners/investors) is happy…until you encounter the same problem as before. Profit margins stabilize and stock prices drop. I’d like to change the world, but I don’t know what to do…