I know that my liberal friends and readers think of me as a union basher who just can't stand the thought of workers claiming a bigger share of the pie. I'm actually not particularly anti-union, and to the extent that I do have problems with unions, it is not because they seek higher wages and benefits for their members. Rather, it is because they introduce serious structural rigidities into the economy. Witness the problems that Delta is having merging with Northwest because they can't get the pilots--who are all in the same union--to agree on a seniority structure.
The Delta and Northwest pilot groups, who were asked by management to negotiate a seniority agreement before a merger deal could be announced, share a problem with their contentious colleagues: there is an age mismatch, with Delta employing the younger group.
On Tuesday, Delta’s chief executive, Richard Anderson, sent a memo to update employees on merger talks. Without mentioning Northwest, the memo said, “To date, we have not arrived at a potential transaction that meets all of our principles.” Among the principles Mr. Anderson listed was “that the seniority of our people is protected.”
Mr. Anderson said in the memo that Delta would “continue to look at strategic alternatives” while also pushing forward with the airline’s standalone plan. A spokeswoman, Betsy Talton, would not elaborate.
Douglas Steenland, chief executive of Northwest, also sent a note to workers Tuesday, and he, too, took a cautious tone in addressing a merger, while not naming Delta.
“We continue to believe that consolidation among the network carriers is inevitable,” Mr. Steenland said in the memo. Among other things, a merger would need to “provide greater long-term security and growth opportunities for our employees,” he added. “We continue to consider strategic alternatives based on these criteria.”
An age mismatch raises the stakes in any melding of seniority lists, with the potential for junior pilots to leapfrog more senior ones and take away more lucrative and attractive assignments. The lists are used to decide who is a captain and who is a co-pilot, pay rates, work schedules, how big an airplane a pilot gets to fly, and who is laid off first in a downturn.
“Seniority — it’s very sacred ground,” said Jack Stephan, who heads the Air Line Pilots Association local for the 2,700 pilots from the old US Airways side of that merger.
Even if union leaders at Northwest and Delta agree to a seniority plan, clearing a path for the largest airline merger ever, the deal could be scuttled months later if rank-and-file pilots decide the plan treats them unfairly.