goingbananas

True. But Skywest would welcome them with open arms....for a lot of reasons....some similar to what is being discussed here.

PTahCha

For our resident FAs, how is this package compared to previous early-outs?

spin88

The third quarter is usually strong, the question will be relative strength. I have not been paying as close attention recently (been swamped) but UAL's guidance (from 7/24) was for +2-4% PRASM with a midpoint of 14.12 c/mi. That is in line with DAL's actual performance so far (Channa knows, but for others, DAL gives monthly results for revenue, UAL does not)

With guidance of CASM being +1-2%, and falling fuel costs, United ought to make more money this quarter than in 2013.

What I don't understand fully though is what expenses will show up where, and also if they are meeting their targets for revenue. There is no data from UAL at this point on these issues, and I can only assume they are in the range they provided as guidence. However, the estimates (which are likely just looking at oil prices at this point and extrapolating from DAL's revenue performance; PRASM +2 in August, +3 in July) have gone up in the last 60 days, and currently show a major profit improvement of about 50% over the showing in 2Q 2013.

Put another way, I seriously doubt that this is being done now to time the expense. I think that management created a very serious problem in labor relations by trying to ram the sCO K down the sUA FAs via layoffs, and it was making getting a joint contract which UAL badly needs harder/impossible. This is a very expensive buy out, and a very good offer, and (hopefully for service and OT) will help them finally get a single FA deal, which in turn will be expensive compared to what Jeff could have gotten in 2011/2012.

LaserSailor

If we can get a FA to quit, do we get the 100,000 USD?

We could document this with "I QUIT" cards...

SkiAdcock

And not all of them are getting $100K. From a post up thread:

"At least 15 years of seniority is required. Lump sum is $4,000 per year of seniority, minimum of $60,000 and maximum of $100,000 (for 25 years or more)."

Cheers.

transportprof

I think that such an enhancement would require reciprocity, with FA's having the opportunity to drive over-entitled elites out of the Mileage Plus program. We'd need red cards with our MP#, ostensibly to document our 'last straw' moment when handed to a FA. But management would actually credit these for a bonus on the early retirement package, encouraging each departing FA to take as many elites as they can with them.

channa

Indeed. And there's no Easter Bunny to hop between months in Q3.

That said, there's no way this is a Q3 expense. Q3 ends in 14 days, and they have to give FAs time to think about it, put in for it, and then they can fulfill it. I'm thinking this is a Q4 or even Q1 expense. And those are the bad quarters.

So I think the timing theory is still a contributor to the motivation.

LAX UA 1K

The timing will be over one year ranging from Nov 15, 2014, to Nov 15, 2015, with each separation date determined by UA's choice within that period to balance staffing needs across bases. I doubt there is a very specific expense timing motivation.

Lots more detailed posted yesterday on the AFA site (including the $5-15K cost of pass travel for anyone not retirement eligible):

http://www.unitedafa.org/benefits/early-out/

Clarkcc1

One key stipulation of this would be the inclusion of a binding agreement to never fly UA or UX metal ever again

spearsba

Then there is not an incentive for senior (25+ years) sUA FAs to take this. If all they get is medical and a travel pass. Forgoing their pension seems like a crap deal in exchange for 100K in taxable dollars. Of course, I do not know what their pension plan is, it could be purley a 401K that they would retain...

Tchiowa

It's income. It's taxed at whatever rate they pay. This will force them into a higher tax bracket. Plus state taxes in their home state. Plus SS if they weren't already maxed out (which they likely weren't). I used to use a "rule of thumb" that any raise, bonus, etc. I would assume I took home roughly half.

LAX UA 1K

My understanding is the early out has no affect on any retirement benefits. sUA pensions were terminated in bankruptcy and taken over by the national Pension Benefit Guaranty Corp. in 2005 (with some reductions per the guarantee terms). Since then FAs have had some kind of 401(k).

oldsmoboi

Maybe they could ask Delta for a status match?

spearsba

OK, then it makes sense. I was repsonding to the quote that said only pmCO FAs kept their pension. I did not know that the sUA FAs had lost their pension in bankrupcy.

Then yes, seems to be a house cleaning of +25 year FAs.

rajsbasi

The reality of it is few will get the headline grabbing $100k so this offer needs as always to be seen in context and relative terms. At the end of the day without turning this into a them versus us, sUA vs sCO the salient effect is this is a measure that will likely have greatest impact on sUA FA's. With that in mind it's arguable that this in turn is a disguised measure designed to bring about the further Continentalization of United, something I am sure we all have our own thoughts about....