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Editor's Note: This news release was distributed by NJASAP on Thursday, Nov. 5, 2009


UNION RECEIVES NOTICE OF NETJETS' INTENT TO FURLOUGH PILOTS

(GAHANNA) – The NetJets Association of Shared Aircraft Pilots (NJASAP) Executive Board has received notice of NetJets Aviation, Inc.’s, intent to furlough up to 495 pilots; the effective furlough date is anticipated for mid January 2010. An independent labor organization, NJASAP represents the interests of the professional pilots who fly in the service of NetJets.

“After several months of continuous efforts to mitigate a pilot furlough, we have reached a point at which the economic realities that challenge our employer can no longer be offset by the ground-breaking initiatives implemented earlier this year,” NJASAP President Capt. Mark Luthi said. In April, the parties launched the Joint Preventive Measures Campaign which gave the pilot force a menu of voluntary, incentivized options intended to alleviate the overstaffing issue. Despite widespread campaign participation, NetJets has concluded the initiative is no longer sustainable.

A second attempt to stave off a furlough was made late last month when the Executive Board presented a series of concepts to senior NetJets executives; however, the most recent effort did not come to fruition. 

Recognizing the seriousness of the economic crisis early on, Association leaders sought to supplement its furlough mitigation efforts by forming the NJASAP Furlough Working Group, which was tasked with preparing a robust pilot assistance initiative should a reduction in force take place. “Hoping a working group’s efforts prove unnecessary is hardly an appropriate mindset for a responsible leadership group; however, I freely admit the Board and I would have preferred the group’s year-long preparations been for naught,” Luthi said.

Almost one year of planning has positioned the Association to offer immediate access to information and resources designed to assist each furloughed crewmember and his or her family during this very challenging time. In addition to a series of informational teleconferences, the Union has launched a web-based Furloughed Pilot Resource Center and has prepared a comprehensive resource guide that outlines financial, unemployment, and worker retraining benefits as well as alternate insurance options and various assistance grants.

The Executive Board has also approved a seven-month dues refund and the immediate cessation of dues collected from affected pilots and has purchased a year-long subscription to two aviation job sites for each pilot. Additionally, the FWG is finalizing an outreach program that will keep furloughed pilots in touch with their peers by paring them with active pilots.

“Although the furlough could not be prevented, NJASAP maintains a tireless commitment to protecting the professional interests of its members and to supporting our furloughed pilots,” Luthi said. “As the NetJets restructuring effort continues, the Union remains willing to engage in mutually beneficial talks intended to hasten our pilots’ return to the flight line.”


About NJASAP
The NetJets Association of Shared Aircraft Pilots (NJASAP) is the independent labor affiliate responsible for overseeing the representation duties of the 2,800-plus professional flight deck crewmembers who fly in the service of NetJets Aviation, Inc. The Association, which is managed by pilots for the exclusive benefit of pilots, is governed by a nine-member Executive Board, maintains a 22-member Stewards Council, employs nine professional staff members, including three attorneys, and sponsors a variety of pilot-managed committees. For more information about NJASAP, please visit the Association’s Web site, www.njasap.com.

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NetJets notifies Union of intent to reduce pilot staffing levels

(NOV. 5, 2009) – Earlier today, NJASAP President Mark Luthi along with fellow Executive Board members received notice of the Company’s intent to furlough up to 495 pilots from the Third Quarter 2009 Virtual Seniority List (3Q09 VSL). According to senior executives, a letter and furlough assistance packet will be sent to affected crewmembers on Wednesday, Nov. 11. The effective furlough date is expected to be Saturday, Jan. 16, 2010; therefore, the contractually required 60 days of furlough pay will end Wednesday, March 17, and full health benefits will terminate March 31. The most recent copy of the 3Q09 VSL is available on the NJASAP Web site.

The number of pilots affected by the reduction in force is consistent with NJASAP projections. NetJets relied on highly sophisticated models and analyses to determine an appropriate crew-to-aircraft ratio based on projected demand and growth in addition to minimum staffing levels specified by the contract. It would seem the Company has chosen to engage in a conservative reduction in the pilot force.

We genuinely regret members of our Association are being furloughed especially at a time when our nation’s economy is just beginning what is sure to be a very gradual rebound. Although the challenges are many, each affected crewmember can be assured NJASAP will provide as much assistance and support as possible. Your leaders will remain vigilant in seeking ways to hasten each furloughed pilots return to the flight line.

A more detailed discussion of the meeting will be provided tomorrow as Board members have several hours of information and data analysis ahead. In the interim, affected crewmembers are urged to review the information available in the Furloughed Pilot Resource Center where many of your questions are likely addressed; pilots may also e-mail the FWG directly or call the NJASAP office, (877) 652-7271, and ask for an FWG member. 

RESOURCES:
3Q09 VSL
Furloughed Pilot Resource Center
Questions for the Furlough Working Group
SPCR

MID-WEEK UPDATE: NOV. 4, 2009

Union Web site, message board scheduled for maintenance
The Web site and Message Board hosting company is scheduled to take the NJASAP server offline for routine maintenance this coming Thursday, Nov. 5 from 1 a.m. to 5 a.m. Both on-line resources will be unavailable during the four-hour window.

Informational RIF teleconferences scheduled
The first of four informational teleconferences sponsored by the Furlough Working Group (FWG) is scheduled for this evening, Wednesday, Nov. 4, at 8 p.m. (ET); teleconferences have been scheduled for each Wednesday in November, beginning at the same time. The purpose of the conferences is to give pilots a detailed overview of the preparations that have been made in anticipation of a furlough as well as to answer some of the most frequently asked questions. The event may be accessed using the following information:

Direct Dial: (800) 214-0694
Toll-Free: (719) 955-1425
Access code: 715892

Because the conferences will be conducted in lecture mode, questions should be e-mailed in advance of and during the event to fwg@njasap.com.


Information packet will not be sent during 2010 open enrollment period
This year, all information relative to the on-going Benefits Open Enrollment Period is being provided on-line as the Company will not be sending an informational packet to pilot homes. In order to review your benefit elections, please follow the steps provided below:

1) Navigate to the NetJets Benefits Web site, www.netjetsbenefits.com
2) Enter your employee ID number, which is the same number printed on your NJASAP Membership Card.
3) Enter your eight-digit date of birth.

The open enrollment period is your only opportunity to review and/or make change to your benefits unless you experience a qualifying life event such as a marriage, birth of a child, or adoption. You may also use this period to register for and/or continue participation in the Flexible Spending Account Program or any of the Company’s other voluntary, supplemental benefit plans.

The open enrollment period will end Monday, Nov. 30, 2009.
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Company serves notice of intent to discontinue select furlough mitigation options

(OCT. 28, 2009) – Late last week, the Company notified the Union of its intent to discontinue select options of the Joint Preventive Measure Campaign launched earlier this year. Because the Company is attempting to determine an appropriate pilot staffing level, this development does not necessarily come as a surprise.

Specifically, the notice stipulates:

1) Effective immediately, additional incentivized Personal Leaves of Absence (PLOA) will no longer be granted. The Company will, however, “continue to make incentive payments for incentivized PLOA” granted prior to Oct. 23. Going forward, new unpaid PLOA will be evaluated in accordance with 2007 CBA Section 16. All requests for incentivized PLOA that remain in “pending status will be denied in the coming days, and crewmember who wish to do so may resubmit their requests as requests for unpaid Personal Leave of Absence.”
   
2) Effective Nov. 25, 2009, the Company will discontinue the Paid Leave Bank Program and will work with NJASAP to develop an orderly process for pilots to schedule remaining PLB days in accordance with LOA 00-010 Part H.
   
3) Effective Dec. 1, 2009, the Company will no longer offer the Reduced Schedule Program.

Additionally, the Company has indicated the Encore has been placed in permanent fleet disposal.

Although the Company has opted to discontinue these particular options, we remain hopeful senior managers will agree to participate in talks regarding a new furlough mitigation initiative based on a proposal given to senior managers last Thursday; additional details about the proposal will be featured in this week’s edition of The 411. While we certainly do not want to give false hope, we believe we have identified realistic, mutually advantageous options for keeping all 2,799 pilots on the flight line.

In the meantime, feel free to contact the Executive Board or the Furlough Working Group with feedback, questions and concerns.
SPCR
PARTIES END 45-DAY STAND DOWN

(OCT. 13, 2009) – Earlier today, Association and Company leaders fully re-engaged during their first meeting in more than a month and a half. Union President Mark Luthi was joined at the three-hour meeting by fellow Executive Board members as well as NetJets, Inc., Chairman and CEO/COO David Sokol, NetJets North America President-COO Bill Noe, Planning, Budgeting and Financial Analysis Senior Vice President Ken Goodman, NJA President Jim Christiansen, Operational Excellence Executive Vice President Bill Olsen, Labor Relations Vice President Mike Maratto, Operational Analysis and Analytics Vice President Bram Ploeg, and Corporate Communications Vice President Todd Weeber at the Company’s Bridgeway facility.

What follows is a brief overview of meeting discussion topics; a comprehensive recap will be featured in the Oct. 16, 2009, edition of The 411.

The NetJets Five-Year Plan
To begin, Sokol will be staying on as CEO for the foreseeable future.

Although the Company’s five-year plan is still being developed, Company managers expressed confidence the NetJets business model is sound, and the Company will return to profitability. Admittedly, NetJets has suffered substantial losses throughout the past year; however, with Berkshire Hathaway’s full support and cost containment initiatives in place, senior leaders consider the outlook promising.

The five-year plan is expected to be completed by the end of November, and a separate 10-year plan is being outlined with completion anticipated in July 2010. Both strategies are being developed with three groups in mind: the owners, the employees and the investors.

Pilot Staffing Levels
A preliminary evaluation of the fleet and pilot workforce is in progress. At this point, a reduction in force is a very real possibility; however, the timeline for the same and the number of affected crewmembers is unknown at this time. The Board, however, does not anticipate any type of furlough notification prior to the series of meetings scheduled for November.

Grievances & Issues
Luthi gave Sokol and his team a list of outstanding grievances and the parties agreed to assemble teams that will engage in working sessions in a bid to resolve these matters.

Separately, the parties agreed to meet in the immediate future to discuss the guidelines for using footage captured by FBO video surveillance equipment. Union leaders remain adamant such footage should only be used in the interests of promoting safety rather than crewmember discipline.

An agreement relative to a pilot’s ability to take advantage of non-revenue flights remains elusive. Considering the parties disparate views on the matter, it may, ultimately, require the Company to reconcile the new policy with the pilot group.

Labor-Management Relationship Committee
The LMRC will continue to function; however, the extent of joint initiatives is unknown at this time. This is one of several topics that will be discussed during one of the November meetings. The joint initiatives in which the Association is most interested in continuing includes the AOM Project, Distance Learning, FOQA and CASS. The parties also discussed the future of the NetJets Family Foundation and the financial commitment not yet fulfilled by former NetJets Chairman Richard Santulli.

Going Forward
Beginning tomorrow, the parties will work to establish a meeting schedule for November. During the first part of the month, the group has agreed to discuss staffing issues as well as those LMRC projects put on hold as a result of the 45-day stand down.
SPCR

Company announces intention to reduce pilot force
JPMC dramatically reduces number of affected pilots

(JUNE 5, 2009) – Union leaders learned earlier this morning the Company intends to commence a reduction in the pilot force within the next few weeks. The announcement was made during a meeting to review the most current statistics of the Joint Preventive Measures Campaign, which included NJASAP President Capt. Mark Luthi and NJA President Jim Christiansen; additional meeting attendees are listed in the Editor’s Note.

To date, JPMC participation has reduced the number of pilots subject to furlough by more than 50 percent; that number is subject to change between now and the closure of the June 12 Early Out window. At that time, Company managers indicated they will notify the Union of the final number of affected pilots. “While we do not anticipate a tremendous difference between now and then, we do believe the number of affected pilots will be in excess of 200,” Luthi said. 

Once the final number is announced, the Company will allow pilots to take advantage of the 36-month leave option rather than to commence an immediate furlough. However, if the number of pilots who take the long-term leave option does not meet the benchmark set on June 12, the Company will begin a reduction in force using the Virtual Seniority List to furlough in reverse seniority order. Luthi indicated the Company intends to reconcile its numbers to ensure there are no out-of-seniority furloughs.

In addition to a formal announcement from NetJets CEO Richard Santulli, scheduled for release this evening, the Union will provide as much information as possible throughout the next several days.

Just 24 hours prior, Association leaders met with Santulli and members of his senior management team to discuss the financial realities that are and will continue to challenge the Company throughout the next 24 months. Luthi was joined at the Thursday morning meeting by Vice President of Financial Affairs Capt. Jeff Burrows and Trustee F/O Jim Hewitt while NJA representatives included President Jim Christiansen, Attorney John Burns and Dan Rosenthal, representing the office of the chairman.

The two-hour meeting, during which Board members posed a series of questions to assess how the economic downturn will affect the Company in the long term, was part of Leadership’s continuing effort to ensure the membership’s concerns and questions are made known at the highest levels of NetJets management.

In preparation for the meeting, Luthi, Hewitt and Burrows developed a set of talking points that emphasized several statements of fact – three of which are provided below. Talking points two and three were based on data culled from the results of the mid-May Wilson Center for Public Research survey of 150 pilots.

POINT #1:
Pilot productivity and performance are at an all time high as evidenced by the results of a recent owner satisfaction survey conducted by the Company.

POINT #2:
Contract concessions are not and will not be discussed as 91.7 percent of the pilots believe the Company can afford the contract as written. What’s more, the contract was written to respond appropriately to the ebb and flow of economic trends.

POINT #3:
Survey statistics clearly show the pilot group will not assume a disproportionate burden of providing financial relief.

Fresh from his early Wednesday morning interview with CNBC, Santulli responded to many of the Union’s questions with comments consistent with those expressed to CNBC news anchors. He acknowledged the current financial hardship, but assured Union leaders the Company is viable in the long term. Santulli also indicated NetJets, whose expenses currently exceed income, is actively selling unneeded assets, and it is doubtful the revenue stream will increase in the next two years (click here to watch the CNBC interview).

The Union President pointed out selling assets is a finite strategy; however, Santulli assured him he has a plan, but did not elaborate.

With regard to concerns that the pilots have yet to see the results of Company cost-cutting and waste-elimination measures, Santulli said NetJets’ efforts to reduce costs are on-going and will become evident as time goes on. In light of this morning’s announcement, Union Leadership will continue to pressure the Company to ensure the pilot group alone does not bear the brunt of such efforts. 

Editor’s Note: Meeting attendees included NJASAP Vice President of Financial Affairs Jeff Burrows, NJA Vice President of Employee and Labor Relations Mike Maratto, Planning and Logistics Executive Vice President Bram Ploeg, Owner and Labor Services Executive Vice President Matt Harris, and Dan Rosenthal, representing the chairman’s office.

  

A STATEMENT FROM UNION PRESIDENT MARK LUTHI

Before today, the Company has neither asked for contract concessions nor furloughed a single pilot, and because of this, we have taken great care to avoid the slightest perception of trying to tell NetJets managers how to run the business. Frankly, it would have been inappropriate for us to assume such a role. Although we continuously communicated pilot feedback and suggestions to senior leaders, we stopped short of voicing specific options for reducing the waste and duplication the pilots see each and every day. Today’s announcement, which appears to have needlessly singled out the pilot group to shoulder an undue burden, has changed that dynamic.

Throughout the course of this morning’s meeting, we conveyed, adamantly and repeatedly, to our NetJets counterparts that it is inappropriate to expect its pilot force to assume the lion’s share of the responsibility for offsetting the Company’s financial woes. What’s more, it is not feasible in any way, shape or form for a reduction in the pilot force to fully offset current losses. Nevertheless, the pilot group is the only employee group beneath the expansive NetJets umbrella slated for reduction of which we are currently aware.

NetJets is in dire need of a Company-wide restructuring plan. Both Jeff Burrows and I expressed very succinctly and firmly that if the Company intends to maintain the level of respect and cooperation it has enjoyed from the pilot group, it must immediately put forth a visible initiative that right sizes the Company from top to bottom. Such a plan is one that goes well beyond mere window dressing: Rather, it relies on appropriate, progressive strategies that can help guarantee its success and long-term viability.

In the strongest possible terms, we emphasized whatever plan the Company chooses to propel its return to profitability is one that cannot be borne by the pilots alone. With this in mind, it is incumbent upon each and every NetJets pilot to contact Company managers to express their feelings on the matter. The Executive Board acting alone is not enough: They need to hear from you.

While we understand the need for sacrifice, our sacrifices must not be in vain: They must accomplish a goal that is part of a larger plan.

Looking head, we anticipate the Company will provide additional information about the planned reduction as well as its plans for returning to profitability. As this information is released, we will ensure you receive timely updates with accurate information. In the meantime, the Executive Board will continue to defend and protect your interests with each and every resource at its disposal. As always, we encourage you to contact us with questions, feedback and suggestions.

UPDATE:  During a late-afternoon telephone conversation with Mr. Santulli, I expressed my concerns that it appears as if the pilot group is being forced to shoulder the burden of mitigating NetJets’ financial woes alone. While he did not offer specifics, he assured me he would provide information to the pilots by the end of next week that highlights his plans for a restructuring effort that will be handled in a fair and reasonable method across the Company. I appreciated Mr. Santulli’s comments and look forward to learning more about an equitable restructuring initiative. In the meantime, each NJASAP member is empowered to offer constructive, meaningful feedback.
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PILOTS ELECT MARK LUTHI TO LEAD ASSOCIATION
Election’s conclusion positions Union leaders to begin new initiatives, projects

(GAHANNA) – The first democratically elected NetJets Association of Shared Aircraft Pilots (NJASAP) Executive Board, led by Capt. Mark Luthi assumed office at noon today, setting a significant milestone for the Association that assumed the representation obligations of the 3,000-plus NetJets Aviation, Inc., pilot group in July. The election was certified by NJASAP Election Committee Chairman Mike King and Associate Counsel Cara C. Seidt after receiving the official results from BallotPoint Election Services, the independent third-party vendor selected to conduct the election on NJASAP’s behalf. Approximately 60 percent of the 2,751 pilots eligible to participate in the election cast a ballot.

Luthi will be joined by Vice President of Representational Affairs Capt. Scott Timko, Vice President of Committee Affairs Capt. Amy Vidovich, Vice President of Industry Affairs Capt. Dan Lieff, and Trustees Capt. Jim Hewitt, Capt. Jim Brady and Capt. Tim Nelson. Capt. Jeffrey Burrows was deemed elected to the position of Vice President of Financial Affairs and Capt. Paul Konrath to the position of Vice President of Records, Communications and Technology at the conclusion of the Candidate Nomination Period on Sunday, Aug. 31, as they ran unopposed.

Per the 2008 Executive Board Election Rules, Luthi, Konrath, Vidovich, and Nelson will serve 18-month terms, which will expire June 30, 2010, while Burrows, Timko, Lieff, Brady and Hewitt, will serve 30-month terms, expiring Dec. 31, 2011; the Association’s Constitution and Bylaws specifically call for staggered elections.

Immediately after the announcement, Luthi expressed his intention to hit the group running. “I have scheduled a working session at our Gahanna office next week which will give us an opportunity to discuss and develop consensus about the basic processes and procedures for managing NJASAP,” he said, adding he appreciated the Company’s willingness to release all nine board members from duty to attend this important meeting. The Board is expected to issue an announcement late next week to inform the membership about its immediate goals.

The results, in brief, are as follows, and the winning candidate is denoted in bold blue text:

President

Mark Luthi

942

Dennis Cotton

559

Thomas Interlichia

152

 

Vice President of Representational Affairs

Jim “Griz” Adams

714

Scott Timko

936

 

 

Vice President of Committee Affairs

Jason Piper

433

Ray Lallo

229

Amy Vidovich

991

 

 

Vice President of Industry Affairs

Dan Lieff

894

Scott Streng

225

Brian Ward

519

 

 

Trustee

 

Michael Perata

604

Jim Hewitt

874

Tim Nelson

744

Eric Eichmann

569

Rob McIncrow

516

Jim Brady

762

Sandra O’Steen

734


The official election document provided by BallotPoint has been attached to this communication and is also available on the Union Web site (click here).

For additional information about the election, feel free to contact the Election Committee.