After Continental unilaterally deployed regional jets at its Newark, Cleveland and Houston hubs shortly after the United/Continental merger became effective 1-Oct-2010, pilots were less than happy. Little wonder since the two pilots unions were targetting outsourcing to regional airlines as a prime issue in its next negotiations only to have the combined company take the action it did at Newark.
It was a red flag to a bull in that it violated the 50-seat cap that has long been in place at Continental. The newly merged company thought it could pull a fast one using the more liberal United jet outsourcing cap. The pilots have now won a key argument after bringing the issue to arbitration.
United, Continental pilots angry over RJ deployment at hubs
The pilots targeted the end of December for resolution of the argument and an arbitrator ruled that United Continental Holdings had gone too far. In a decision issued Thursday, 30-Dec-2010, he ruled the 70-seat jets could not be used with Continental codes.
United disagrees with Arbitrator Richard Bloch’s decision but will be using the jets under the United Express brand to skirt the Continental prohibition. It just won’t be able to advertise them as Continental flights only a slight problem at the Continental-dominated hubs.
“We are pleased the decision will permit the company to redeploy 70-seat aircraft in certain markets under United Express brand to better meet demand and improve profitability for the combined company,” said the company in a emailed response to reporter’s questions.
While it counts as a victory for the unions, it is unclear what the move really accomplished. the newly merged company just seems to have made the pilots angrier at outsourcing than they already had been. That doesn’t bode well for upcoming negotiations despite Continental CEO Jeff Smisek’s promise to give Continental pilots the Delta salary rate plus one dollar.
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