Heard through the grapevine the arb ruling is in. The pilot union grievance was denied. Waiting for press story. Will post, unless someone else does first.

From Airliners.Net

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To: All Midwest and Skyway Employees
Date: January 20, 2009
From: Corporate Communications
Subject: Arbitration Ruling

As you know, on Sept. 3, 2008, Midwest Airlines entered into an airline services agreement with Republic Airlines to operate a fleet of Embraer 170 aircraft under the Midwest Connect brand. The Air Line Pilots Association subsequently filed a grievance, contending that the arrangement was a subcontract that violated our collective bargaining agreement with the pilot group. The grievance was submitted to the System Board of Adjustment for review. The board has issued its decision denying the grievance.

The board concluded that our arrangement with Republic Airlines to operate the Embraer 170s is permissible under our collective bargaining agreement with the pilot group. Specifically, the board found that the arrangement is a legitimate codeshare agreement, and further found that our collective bargaining agreement with the pilots provides Midwest the unrestricted right to engage in codeshares. Accordingly, the board ruled there was no violation of the labor agreement

I hope the flight attendants can see the handwriting on the wall.

Take your pay cuts, and be good employees. If you don't like it, go find another job.

In this economy? Easier said than done. How much of a a pay cut are we talking about? Some of those pay cuts that Tim was suggesting were ridiculous.

This has been discussed before, but Midwest never released on specifics on the tpye or amount of pay cuts they were seeking.

The only details came from the unions themselves. Some news outlets reported cuts up to 40 percent or so for some employees, but we have no idea how accurate that number really was. The union had their own agenda and probably picked and chose the most drastic figures under worst case scenarios to feed to the media.

JSOnline finally has a story on this.

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http://www.jsonline.com/business/38018774.html

Arbitrator upholds Midwest Airlines' restructuring
By Tom Daykin of the Journal Sentinel

Posted: Jan. 21, 2009 3:17 p.m.

Midwest Airlines Inc.'s decision to hire another carrier to operate several Midwest Connect flights, resulting in job losses for Midwest's union flight crews, does not violate the company's contract with its pilots, an arbitrator has ruled.

Oak Creek-based Midwest Airlines announced last fall it was hiring Indianapolis-based Republic Airways Holdings Inc. to operate Midwest Connect flights that were previously flown under the Midwest Airlines name. That came after Republic agreed to provide up to $25 million in financing to Midwest, which helped prevent a Chapter 11 bankruptcy filing.

Midwest's pilots and flight attendants unions both filed grievances, saying the outsourcing to Republic violated their contracts - a claim Midwest denied. The company says it will rehire laid-off flight crews after they're trained to staff the Republic jets, but only if they accept substantial pay cuts.

Midwest said today that the pact with Republic is allowed under the company's contract with its pilots union, according to the arbitrator's ruling, said company spokesman Michael Brophy.

Capt. Jay Schnedorf, head of the Midwest pilots union, said union officials are disappointed with the ruling but will continue to negotiate over the company's demands for pay cuts.

A separate grievance filed by the flight attendants union with another arbitrator is still pending.

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I'm suspect there are two fundemental stumbling blocks on the pay issue. First, these are pilots who had flown aircraft designed for 150 and 120 coach seats, being downgraded to aircraft designed for 76 coach seats. Second, with layoffs the remaining pilots are probably very senior and near the high end of the scales. Both of those work against the pilots in their attempt to avoid serious wage cuts.

Hopefully they are able to come to an agreement. It's (very) mildly encouraging that the feedback from the union rep wasn't any harsher than this.

The sooner Midwest gets its house in order, the sooner they can embark on whatever changes they are likely considering. It's interesting to note that with the range of the 170 they could fly nonstop from MKE to the west coast. And the existing 717 and 170 fleet, once RSW and MCO go for the season they can rework their schedule to fly daytime nonstops to LAX, SFO and SEA with only minor changes to the rest of their current schedule. They may not choose to do this and instead redeploy the freed-up Florida lift to add frequencies in some existing routes. But I think they're purposely holding back on their summer changes...whatever they will be...until the picture is clearer.

The flight attendants lost in arbitration too.

http://www.jsonline.com/business/38454964.html

YX is two for two. What's next? Any speculation?

The word on the street is that there will be a big announcement tomorrow here from MKE.

YX- Losing 717s?
Tim. H stepping down?
Republic pulling out?

All of the above? Maybe two of the three, I don't foresee Republic going anywhere.

Humpty-Midwest sat on a wall
Humpty-Midwest had a great fall
All the kings' horses,
And all the kings' men
Couldn't put Midwest togther again

Apparently, the word on the street was unreliable.