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Current Airline Labor Protective Provisions (LPPs)
Merger LPPS
Although the Airline indusry had developed merger labor protective provisions (LPPs) in the early 1950s through the 10970s, they eventually for all practical purposes were lost after the enactment of the Airline Deregulation Act of 1978 (ADA), and the ADA labor protections were repealed in 1998. However, in December 2007, Public Law 110-161 was enacted and it directed that two of the Allegheny-Mohawk labor protective provisions must be followed when air carriers merge. The law imposes sections 3 and 13 of the Allegheny-Mohawk order:
Section 3
Insofar as the merger affects the seniority rights of the carriers employees, provisions shall be made for the integration of seniority lists in a fair and equitable manner, including, where applicable, agreement through collective bargaining between the carriers and the representatives of the employees affected. In the event of failure to agree, the dispute may be submitted by either party for adjustment in accordance with section 13.
Section 13
(a) In the event that any dispute or controversy (except as to matters arising under section 9) arises with respect to the protections provided herein which cannot be settle by the parties within 20 days after the controversy arises, it may be referred by any party to an arbitrator selected from a panel of seven names furnished by the National Mediation Board for consideration and determination. The parties shall select the arbitrator from such panel by alternatively striking names until only one remains, and he shall serve as arbitrator. Expedited hearings and decisions will be expected, and a decision shall be rendered within 90 days after the controversy arises, unless an extension of time it is mutually agreeable to all parties. The salary and expenses of the arbitrator shall be borne equally by the carrier and (i) the organization or organizations representing employee or employees or (ii) if unrepresented, the employee or employees or group or groups of employees. The decision of the arbitrator shall be final and binding on the parties.
(b.) The above condition shall not apply if the parties by mutual agreement determine that an alternative method for dispute settlement or an alternative procedure for selection of an arbitrator is appropriate in their particular dispute. No party shall be excused from complying with the above condition by reason of having suggested an alternative method or procedure unless and until that alternative method or procedure shall have been agreed to by all parties.
Development of Airline LPPs
In 1938, the Civil Aeronautics Act transferred federal responsibilities for non-military aviation from the Bureau of Air Commerce to a new, independent agency, the Civil Aeronautics Authority. The legislation also gave the authority the power to regulate airline fares and to determine the routes that air carriers would serve.
In 1940, President Franklin Roosevelt split the authority into two agencies, the Civil Aeronautics Administration (CAA) and the Civil Aeronautics Board (CAB). The CAA was responsible for air traffic control, safety programs, and airway development. The CAB was entrusted with safety rulemaking, accident investigation, and economic regulation of the airlines. Federal Aviation Act of 1958 (P.L. 85-726, 72 Stat. 731) created a Federal Aviation Agency (later called the Federal Aviation Administration; FAA) and empowered it to oversee and regulate safety in the airline industry and control civilian and military use of the airspace over the United States. Building on the Civil Aeronautics Act of 1938, the Federal Aviation Act of 1958 reestablished the CAB, transferred its safety regulatory functions to the newly created FAA, and empowered the FAA to take control of all navigable airspace over the United States for both civilian and military purposes.
The CAB, noting that the Board’s public policy considerations were similar to the ICC’s in the instance of railroads, began to apply labor protective provisions (LPPs) in the early 1950’s. Labor Protective Provisions (LPPs) were routinely applied by the Civil Aeronautics Board (CAB) in the 1950s and 1960s in airline mergers. In 1972 the CAB moved to standardize its merger protections with the adoption of the merger protections provided in the merger of Allegheny and Mohawk airlines, 59 CAB 22 1972. The Allegheny-Mohawk formula granted several protections for employees adversely affected by an airline merger:
protections included a monthly displacement allowance for employees whose compensation was reduced
a dismissal allowance for employees who lost their job
reimbursement for relocation expenses
compensation for other losses suffered as a direct result of the merger
required that seniority systems be integrated in a “fair and equitable manner” and provided mediation and arbitration to resolve disputes over LPPs.
The CAB was eventually eliminated in 1985 pursuant to the Airline Deregulation Act of 1978 (ADA). The CAB retreated from LPPs in the early 1980s after the industry was deregulated and began using them on a very limited basis. Since 1985, when the CAB expired and its jurisdiction was transferred to the Department of Transportation under the auspices of the Federal Aviation Administration (FAA), LPPs have been generally rejected. Notwithstanding the above the Allegheny-Mohawk LPPs, specifically certain sections, have been incorporated and/or referenced in collective bargaining agreements negotiated since 1985.
Deregualtion Protective Conditions
Despite its effective elimination of the merger LLPs, the ADA provided for a new and distinctive set of employee protective provisions to aid employees adversely impacted by deregulation in the airline industry. These protections were provided in Section 43 of the Airline Deregulation Act as the Employee Protection Program (EPP) and included financial assistance and hiring preferences.
On December 27, 1985, the Department of Labor issued regulations to implement the Airline Employee Protection program established by Section 43 of the Airline Deregulation Act of 1978,codified as 29 CFR Part 220. The regulations covered the following items: Rehire Program and Qualifying Dislocations, Waiting Period, Exemption from the Duty to Hire, Definition of Protected Employees, Equal Employment Opportunity, New Entrants' Requirement to List Vacancies, Recall Rights, Temporary and Seasonal Employees, Responsibilities of Non-Operating Carriers, Participation of Labor Organizations, Eligibility for Designated Status, Notices of Rights, Effective Period, Submission of Semiannual Reports, and Enforcement.
In 1998, Congress repealed Section 43 of the Airline Deregulation Act in Section 199(a)(6) of the Workforce Investment Act, Pub. L. No. 105-220, 112 Stat. 1059 (1998). As a result, the regulations implementing the Airline Employee Protection Program were without force or effect because their underlying statutory authority had been repealed. The Final Rule published May 22, 2006, rescinded the regulations.
The foregoing is supplied for general information purposes only and should not be relied on as legal advice.
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