CHAPTER 16
OF B-SCALES AND ALPA’s FUTURE
The United Strike of 1985
An ancient Chinese curse says: “May you live in interesting times.” Professional airline pilots were discovering the true meaning of that curse by the mid-1980s. “Interesting times,” filled with tragedy and turmoil, conflict and loss, make for dramatic history—but they’re hard to live through. The fate of winners and losers dramatically counterpoised, “sad tales of the death of kings,” have absorbed us since the dawn of human history. Indeed, losers often generate more interest than winners. How else can we account for the endless fascination with Adolph Hitler’s last days in his Berlin bunker?
A strike always carries the possibility of loss. Before deregulation, ALPA’s fights with management mainly ended in victory. Ask National Airlines’ Ted Baker, Southern Airways’ Frank Hulse, or the notorious E.L. Cord of Century Air Lines about that. But in the antilabor 1980s, with political conservatism rampant on a field of deregulation, Frank Lorenzo had reversed that historical tide. Could ALPA win a fight in this brave new world, where government tilted against labor instead of toward it? The pilots of United Airlines would confront that question directly.
Blue Skies became Frankenstein’s monster in record time. What the United pilots thought would inaugurate a golden age turned into a time of troubles within a year. As a result, MEC Chairman John Ferg, the man most responsible for Blue Skies, saw his standing with United’s pilots plummet. Dick Ferris had sold Blue Skies to him using all the trappings of friendship, ego enhancement, and one must admit, rational calculations of his pilots’ self-interest. Better leaders than John Ferg might as easily have succumbed to Ferris’s silky persuasion. So the question of Ferg’s motivation confronts us. Rick Dubinsky, originally a Ferg supporter, began feeling uneasy about him after the “second videotape,” a 1982 attempt to allay rising pilot suspicion of Blue Skies, paid for by the company but produced by the MEC.
“It was a real propaganda operation,” Dubinsky asserts. “I confronted John about the tape. Where was the other side of the coin? It was just a giveaway. And he just grinned at me. He knew I had figured it out. At this point, I became convinced that the pilots were being taken to the cleaners and that Ferg knew!”
Unanswered questions linger. Was John Ferg ALPA’s Benedict Arnold, or merely mousetrapped by Dick Ferris? Should we fault Ferg for not recognizing the Faustian nature of the bargain he struck with Ferris? And what of Dick Ferris himself? Was he genuine, or simply a con man? How did Blue Skies, undertaken with such high hopes and vows of mutual cooperation, become a grim joke so quickly? Most importantly, why didn’t Ferris use Blue Skies to “grow the airline?”
Put simply, Blue Skies failed to accomplish what Ferris promised either because he never intended to use it that way, or because he miscalculated its effectiveness, or because he was incompetent—or some combination of all three. And, as we shall see, a mid-course correction inspired by Frank Lorenzo might have affected Ferris.
But in one sense, Ferris used Blue Skies beautifully. United’s balance sheet showed record profits by 1984, and in cost per seat-mile, the airline ranked as the most efficient unionized carrier. By early 1985, the Air Transport Association listed only People Express, Southwest, and Continental (all nonunion or with independent unions) as having lower seat-mile costs than United.
But what had United’s pilots gotten out of it? By the summer of 1982, barely a year into the new contract, they looked increasingly foolish as it became clear that Ferris’s only real use of Blue Skies so far had been to increase United’s profits by exploiting its more relaxed work rules.
Indicative of Ferris’s flush coffers, on April 22, 1985, he signed an agreement with Pan Am’s C. Edward Acker to buy the entire Pan Am Pacific route structure and all the aircraft required to fly it (11 long-range Boeing 747SPs) for $750 million. This incredible deal, which shifted fully one-fourth of Pan Am (with all the employees, pilots included) to United, was a blockbuster—the biggest single deal in the history of commercial aviation. But it was hardly the kind of expansion United’s pilots expected, and it benefited them little in terms of promotion, always Blue Skies’ most attractive promise. Because ALPA was involved in the purchase, it could ensure proper application of merger policy, and Pan Am’s 430 transferring pilots would count themselves lucky because of it. Coming as it did during the spring of 1985, just as contract negotiations intensified, the Pan Am acquisition undercut Ferris’s arguments that United had to have additional concessions from ALPA to survive. Important stockholders would also raise questions about the purchase, not only because they thought Ferris overpaid Pan Am, but because something didn’t smell right about it. Leafleting pilots outside the Westin O’Hare Hotel, site of United’s annual stockholders’ meeting, made a point of sharing these misgivings.
One aspect of the Pan Am buyout merits comment for its labor implications. When compared to Eastern’s 1982 purchase of Braniff’s Latin American routes, the United pilot group comes off very well. The Pan Am pilots who now wear United uniforms owe a lot to the fact that United’s pilots wanted no part of any “expansion plan” that would shove brother pilots out of their cockpits and off their routes. The fact that this came up in 1985, as the strike neared and as United’s pilots were desperately building internal unity and a sense of professional brotherhood, probably had something to do with it, too. But in the long and sorry history of merger animosity, United’s pilot group stands out for its sense of fair play and commitment to justice, particularly in this instance.
Thus, by 1985, as the Blue Skies contract came up for renewal, Ferris’s talk about using it to turn United into the big monkey that would “kick butt” in the airline industry seemed hollow. Not only that, but in a classic example of the “law of unintended consequences,” neither Ferris nor Ferg seemed to consider how the 500-pound gorilla in the next cage might react. United was, after all, not the only big primate in the airline zoo.
Almost immediately after news of Blue Skies hit the industry in 1981, Robert Crandall, the powerful CEO of American Airlines, began using it as a wedge to split open his own pilots’ contract. Leaders of the Allied Pilots Association (APA), the ALPA clone that resulted from the 1963, were susceptible to Crandall’s pressure tactics for many reasons, not least being that they saw Blue Skies as aimed at them. Crandall cleverly exempted American’s current pilots from United-style across-the-board givebacks by proposing a two-tier scale that would pay new-hires substantially less. He would first impose a B-scale on American’s mechanics in 1982 and then immediately target the APA for a similar contract. American’s pilots were on Crandall’s B-scale agenda in any case, but Blue Skies provided a convenient excuse and plenty of leverage.
In 1983, the APA’s leaders agreed to a contract that would pay newly hired pilots approximately one-half the going rate. Deregulation had rekindled the traditional rivalry between United and American, historically the two biggest airlines in the industry. To leaders of the APA, Blue Skies seemed like naked aggression against their carrier, amply justifying a response. Crandall sweetened the deal by granting a small pay raise (in lieu of one that the APA had given back earlier), agreed not to lay off any pilots for the life of the contract, promised to recall 500 furloughed pilots by 1986, and established a profit-sharing plan. So in effect, this first major-airline B-scale bribed American’s 3,400 pilots with some middling benefits, but it boiled down to selling their patrimony on faith for a mess of Crandall’s pottage.
But initially, the American pilots’ gamble paid off. Crandall, unlike Ferris, did use his givebacks constructively to “grow” the airline. Not that it benefited American’s pilots all that much. By the early 1990s, despite American’s phenomenal growth and the near doubling of its pilot force, lagging pay and increasingly harsh working conditions had made American’s flight crews among the angriest in all of aviation, driven to the desperate expedient of a wildcat “sick out.” This massive action forced Crandall to cancel 11 percent of his flights over the holidays in January 1991 and to run full-page ads headlined “AApology” (with American’s familiar eagle logo cutely placed between the redundant double “AA”). In a startling lapse, American’s publicity flacks mistakenly identified their own pilots’ union as ALPA! So they had to spend more money correctly identifying the APA in additional ads!
Thus, the sins of the fathers were visited upon their children. The roots of their transgression lay in the unprecedented B-scale “giveback” the APA’s leaders handed Crandall in 1983, which went far beyond Blue Skies. At least United’s pilots shared the pain with those who would inherit their cockpits. The APA’s leaders sacrificed nothing themselves, while passing the pain to their professional posterity, an act redolent of generational betrayal, replete with threats to safety, and with profound implications for the very future of pilot unionism. If the B-scale worked as planned, in the run of time a majority of pilots would be second-class citizens, resentful of their elders and the union that had sold them out. When the United’s pilots’ own B-scale crisis came in 1985, they argued strongly that the resentments of underpaid new-hires would inevitably affect not only unionism, but also crew coordination and hence safety.
Ironically, almost at the exact moment the APA was gambling with the future, Blue Skies started unraveling on United. By 1982, barely a year into Blue Skies, scattered results from LEC elections indicated a small wave of opposition. In Chicago, Cliff Sanderson displaced Dick Kuhn, a strong Ferg supporter, as chairman of Council 12. This LEC election dramatized both incipient disillusionment with Blue Skies and John Ferg’s political slippage as well. Sanderson, a former B-29 pilot who spent half a career in the Air Force before signing on belatedly with United in 1964, changed his mind about Blue Skies after seeing it in action.
“To be honest, I thought Blue Skies was a very good thing at first,” says Sanderson, a University of Maine graduate who majored in foreign languages. “Like most United pilots, I accepted John Ferg’s assurances that Dick Ferris would not use Blue Skies to exploit us. But Ferris interpreted Blue Skies as a sign of our weakness, and it snowballed through the whole damn industry. Everybody blames the givebacks on American, but United under John Ferg caused it.”
ALPA loyalist Hal Osteboe, who helped squelch Ferg’s secession plan in 1980, also won election in 1983 as first officer representative from Chicago’s Council 12. By then, the “Ferg Dogs” were in full retreat. Chicago’s Council 12, the largest on United, provided an excellent barometer of rank-and-file pilot opinion.
“I would say that within 90 days of Blue Skies going into effect, Ferg’s reputation began to sink,” says Osteboe, a precise, studious man who could easily be mistaken for a professor. “The LEC election cycle began to reverse in 1982 and then became an anti-Ferg landslide in 1983 because Ferris didn’t take any advantage, in a business sense, of the givebacks in Blue Skies.”
In all probability, Dick Ferris didn’t use Blue Skies to “grow” the airline because he simply didn’t know how, at least in the beginning. As we have seen, aside from his What Makes Sammy Run? glibness, Ferris’s qualifications for United’s top job were thin. His career after leaving United seems to confirm that he was, as the saying goes, an “empty suit.”
“As time went on, it became apparent to me that Ferris was a good huckster, but not a good businessman,” says Roger Hall, who negotiated Blue Skies and knew firsthand how little use Ferris made of it. “I became disillusioned with him very quickly. If he had all this business acumen, I would have thought he’d have found another top management job after leaving United. But he’s been basically just unemployed ever since.”
Hall might be correct in his belief that Ferris’s failure to put Blue Skies to productive use stemmed from simple incompetence—at least in the beginning. But we must remember that just as Blue Skies arrived, Ferris had another powerful role model to observe—Frank Lorenzo. Ferris might have entered on Blue Skies in good faith and then, noticing the success and news media attention Lorenzo was getting with his hard-line approach to labor, changed his mind to become a “copycat killer.”
In the rarefied world of top airline executives, not all decisions need have economic justification. In fact, a plausible case can be made that intangible considerations of prestige and status played a powerful role in motivating top airline executives like Ferris, Lorenzo, and later, Carl Icahn, the corporate raider and financial manipulator who would seize TWA in 1986. Perhaps their drive to cut pilot salaries sprang from competitive urges run amok, a kind of antilabor feeding frenzy among boardroom sharks. To be able to walk into the exclusive forums where these top CEOs rubbed elbows, where they could revel in their colleagues’ approval (or envy) of the way they had stood tall against labor, particularly the haughty pilots, might explain a lot. Certainly, rational economic analysis cannot entirely explain the economic damage that Lorenzo and Ferris did to ALPA, their airlines, and ultimately themselves. Answers might be available in the field of abnormal psychology, however.
“In hindsight, it’s easy to see that people like Lorenzo and Ferris were not going to be satisfied with anything short of destruction of ALPA on their property, and you have to ask yourself what do they gain?” says Northwest’s Skip Eglet, who pondered this question from an executive vice-president’s vantage. “I mean, ALPA was willing to grant deep concessions, anything they wanted really, and they wanted more, is what it amounted to. There really isn’t any logic to it, because they could have gotten what they wanted without doing what they did. It is something I will never understand.”
Maybe these airline executives believed their own propaganda. Many of them seemed to believe that modern pilots were unworthy of their heritage, that they were unwilling to take risks that might jeopardize their affluent lifestyles. Perhaps the airline industry’s Ferrises and Lorenzos believed that, unlike the Old Guys who had bled real blood and risked cherished careers to build ALPA, this new generation of pilots, with their Rolex watches and Porsches, had no real fight in them. Maybe they were patsies, easy marks who would meekly submit to any CEO steely enough to take them on frontally. Certainly, the national political climate, with the “Reagan Revolution” at full antilabor tide, encouraged such ventures. If ALPA’s house had rotten walls, and its modern inhabitants lacked the iron will of the Old Guys who had built it, then the times almost demanded action—all a bold airline boss had to do was kick the door down, as Frank Lorenzo had already demonstrated.
If that’s what Dick Ferris thought, the pilots of United were about to prove him mistaken. The rapid transformation of this pilot group, as they reacted to Ferris’s misuse of Blue Skies, stunned everybody. Hank Duffy, who became ALPA’s president just as the phenomenon became full-blown in January 1983, had a box seat.
“The whole personality of the United pilot group changed,” Duffy said in his 1990 interview. “They were involved in everything, coming to meetings, much more into mutual assistance to each other. It would really be interesting for an industrial psychologist to study how that group changed so dramatically, from Blue Skies, where they couldn’t give Dick Ferris enough, to the hard-line militants they became.”
A sense of betrayal spurred this militancy. It began among United’s best-informed pilots, particularly among a segment of the MEC led by Hal Osteboe, Jim Engleman, Doug Wilsman, and by 1983, Rick Dubinsky. As awareness of Blue Skies’ inadequacy grew, it turned to anger and spread to the rank-and-file. Ironically, Negotiating Committee Chairman Roger Hall, long considered a Ferg acolyte, had also slipped into opposition as he came to doubt the agreement he had brokered.
“The pilots weren’t unhappy with the pay, because some really good raises were scattered through Blue Skies,” says Hall. “But the airline wasn’t growing, and Ferris was beginning to complain very loudly about his payroll costs. The understanding in Blue Skies was that we would have continuous negotiations. Ferris didn’t live up to his part of the bargain, and getting our problems addressed was like pulling teeth.”
For John Ferg, who unquestionably had ambitions for national ALPA office, the clouding over of Blue Skies had devastating consequences. Without the support of his own MEC, he would not be able to challenge for ALPA’s presidency in 1986. His MEC support began to erode in 1982 and expanded among rank-and-file United pilots in early 1983. When leavened by the informed arguments of his MEC critics, the inchoate dissatisfaction of ordinary line pilots rapidly swelled into an anti-Ferg majority. Nearing the end of his second term as MEC chairman, Ferg desperately needed another term to keep alive his chances of ousting Hank Duffy. But a long-standing United policy limited the chairman to two consecutive terms unless the MEC approved a third term by a two-thirds majority.
In June 1983, the MEC meeting at the Bond Court Hotel in Cleveland, Ohio, dashed Ferg’s hopes for a third term. He could not secure even a simple majority, let alone the two-thirds MEC vote he needed. Ferg furiously denounced the MEC he had so recently controlled.
“It finally came down to a shouting match in a hotel corridor,” says Hal Osteboe. “Ferg screamed that we had stabbed him in the back, that we couldn’t see the noses on our own faces, that he knew where the industry was going and nobody else did, and that only he could save us.”
Blocked from a third term by his own disaffected MEC, his prestige in tatters among rank-and-file line pilots, Ferg responded by becoming even more adamantly committed to Ferris’s view of Blue Skies. He would shortly damage his standing with the pilot group beyond repair by unilaterally deferring one of the regular Blue Skies pay raises to which Ferris was objecting.
One of flying’s oldest tongue-in-cheek aphorisms has it that a pilot doesn’t become a “professional” until he starts asking, “Who pays me?” Ferg’s deferral of the pay increase nipped at each United airline pilot’s wallet-to-heart nerve, and everybody flying the line, no matter how remote from the center action, had an opinion about that!
“As we approached the fourth pay raise, John Ferg took it upon himself to defer it, and that was a big bone of contention,” says ex-naval aviator Bill Stewart, a Los Angeles-based B-747 captain who would later serve as communications director for his LEC during the strike. “The fact then came out from some of the older people that Ferg was MEC chairman once before and got recalled. Most of us didn’t know that—I didn’t. I guess we deserved what we got for not being better informed as to Ferg’s previous history.”
Actually, Ferg’s recall in 1965 had less to do with his shortcomings than with a quirk of MEC politics at the time. At the first combined MEC meeting following the 1961 merger of Capital and United, voting for chairman was “one MEC member, one vote.” Because Capital had more crew bases than United, that meant a majority of MEC members were, like John Ferg, former Capital pilots. Because each domicile, regardless of the numbers of pilots based there, elected representatives to the MEC, a “tribal vote” easily put Ferg into the chairmanship. The “old” United pilot group, vastly larger than the number of former Capital pilots, found this intolerable. So, without even considering Ferg’s merits, at the very next MEC meeting, the MEC recalled him, which they could do because a recall vote, unlike the chairman’s election, went by roll call based on the membership totals at each crew base.
“I was about to come on the MEC at the time,” recalls John LeRoy of Ferg’s recall. “Ferg got to go to only one MEC meeting as master chairman. He always bore a grudge about that.”
When Ferris eventually created a management position for Ferg on the eve of the strike, perhaps this ancient slap made it easier for him to accept. But nobody who lived through that episode thinks Ferg’s managerial status was genuine, and almost everybody harbors deep suspicions about Ferg’s role in encouraging Ferris to challenge ALPA.
“I have no doubt that Ferg was telling Ferris we could be had,” Rick Dubinsky asserts.
“I lay 80 percent of the blame for the strike right at the feet of John Ferg,” Roger Hall agrees. “He became so bitter when the MEC would not agree to a third term that in short order he went into management and began telling Ferris that if he ever wanted to take on the pilots, do it now, that we were divided, we’d crumble.”
By January 1984, with Roger Hall taking over a faction-ridden MEC from John Ferg, Dick Ferris had to be thinking of the similar situation on Continental, which Lorenzo had exploited. Ferris probably concluded that the time was right to emasculate ALPA on United, if not to break it entirely. Roger Hall was the junior captain on the airline when the MEC elected him chairman at Honolulu in October 1983, by a single vote, over the vastly experienced former chairman Jerry Pryde, one of United’s most senior and respected captains. Hall could only barely hold a captain bid and hadn’t even gone to school yet. Would the airline’s senior pilots follow this relatively junior MEC chairman into a strike? An ancient prejudice against junior pilots holding high MEC office still existed on United, which had never elected a noncaptain MEC chairman.
“Had I not had the captain bid, I don’t think I would have been elected,” Hall says simply.
On the surface, it appeared that Roger Hall would continue Ferg’s program, slightly modified, because he was closely identified with Blue Skies. But Hall had parted company with Ferg sometime in 1983, largely because he thought Ferg’s relationship with Ferris had degenerated into an unequal and unhealthy dependency that was undermining the fundamental tenets of unionism.
“I did not feel we must always be confrontational with management,” says Hall of his evolving position. “We have many areas of mutual interest, but to some degree labor relations is confrontational. John had been delivering all kinds of things to Ferris, really in bed with management. I believed the integrity of the process had been violated and required a more arms-length negotiating stance.”
Simultaneously with Hall’s taking office, a new Negotiating Committee chaired by Bill Brashear began working on a contract to replace Blue Skies. A high degree of continuity characterized this new committee. Under Hall’s chairmanship, the committee members had been Brashear, Dick Brace, and Al Santmeyer. Brace would hold over on the new committee, Deke Clark would take Santmeyer’s slot, and Warren Nelson would become the fourth member of Brashear’s team. As MEC chairman, Hall effectively remained on the committee, actively participating in selected phases of the negotiations. The new committee had need of Hall’s experience, for the talks went badly almost from the start.
“I had a number of meetings with Ferris one-on-one as the talks began,” Hall says. “He just got more and more strident, hard-nosed, and demanding. As the summer went by, we were having a difficult time, and I began to feel Ferris was setting us up for a strike, looking to outdo Frank Lorenzo.”
After all the years of dealing with John Ferg, Roger Hall’s calm demeanor must have struck Ferris as too lacking in fire to provide the strong leadership United’s pilots would need in a strike. The soft-spoken Roger Hall had no Ferg-style bombast, so how could he function effectively as a leader in time of crisis?
The answer lay not in Hall’s forensic skills, but in his talent for organization, preparation, and most of all, picking subordinates. Hall established a Strike Preparedness Committee in September 1984, appointing Rick Dubinsky chairman. His first order to Dubinsky’s committee was, “Go to school on Continental.”
Dick Ferris had seen the future at Continental, and he wanted to be part of it. United’s pilots had seen the same future and wanted no part of it.
“They were to look at what went wrong on Continental,” Hall says of his charge to Dubinsky. “If we were going to find ourselves in a strike situation, which I really hoped we could avoid, we weren’t going to make the same mistakes Continental did.”
A cold panic gripped the United pilots’ leaders, forcing them to focus their attention the way an engine-out emergency would. Like a classic barroom bully, Ferris taunted and probed United’s pilots, who had not been on strike since 1951—a “job action” that lasted either 11 or 12 days, depending on how one counted certain events. During that long-ago strike, pickets marched, leaflets circulated, and meetings met. Nobody flew—nobody! The airline shut down completely. But 34 years is a long time between strikes, and the current generation of United pilots would have to learn everything afresh. Were they up to it? On the few occasions when they had honored other unions’ picket lines during the intervening years, United’s pilots had really done nothing significant, other than quietly not fly.
Given the history of then-recent strikes at Wien, Northwest, and the ongoing debacle at Continental, one can only imagine the United pilots’ state of mind. But the gauntlet was down, and United’s pilots had to either respond or crawl away.
The job of whipping United’s line pilots into fighting trim fell on Dubinsky’s committee, which included Ray P. Schlage, Keton Barnes, Felix Isherwood, Bruce Wilkinson, and Pat Palazzolo—all canny veterans. They received valuable indirect aid from volunteers like former MEC Chairmen Scotty Devine and Dick Cosgrave, both retired by 1985. These older pilots played an important role in mentally toughening younger pilots, with advice both practical and historical.
“Fighting between management and labor isn’t all bad,” Cosgrave said. “But you’ve got to fight fair, like you do with your wife, because you’ve got to crawl back in bed again.”
Both Cosgrave and Devine worried that line pilots might have an overly romanticized view of United’s history, particularly when it came to the semi-legendary W.A. “Pat” Patterson, the former Wells Fargo banker who became president in 1931. For all his father-figure image, Patterson had fired Dave Behncke, and he would have done the same to others had not ALPA stopped him. The Old Guys knew how to close ranks when a brother pilot was being abused. The Pat Patterson of rosier later years would brag about his pilots’ high salaries and United’s cozy labor/management relations. But that was true only because Patterson had learned from bitter experience that he couldn’t kick his pilots around.
“With all his positive attributes, Pat Patterson was still a hard-headed banker,” says Scotty Devine, who began flying for United in 1940 and knew Patterson well. “I think we remember him fondly because he never backed himself into a corner like Ferris, and he showed a great deal of wisdom in strikes, so when it was all over there were no bitter feelings to be overcome. But times weren’t all that easy back then.”
In a sense, United’s pilots confronted a fight as irrepressible as the U.S. Civil War. The record is abundantly clear that no concession United’s pilots could have made at this point would have averted the storm rumbling toward them. Historical details about negotiations, therefore, matter little. Dick Ferris was going to have his test of strength. He had already cowed the mechanics and flight attendants into accepting a two-tier wage scale by 1985. Only the pilots were left standing in his way. They didn’t want a strike, the ultimate test of any union, and they didn’t seek it.
If a fight must come, Dick Ferris made an ideal opponent because by 1985 he had so little credibility with his pilots. Following Braniff’s bankruptcy in 1982, United’s pilots experienced the same unease as others in the airline industry, and they had slowly come to doubt not only Ferris’s integrity, but his business sense as well. As we have already seen, the incompetence of airline executives had become a mounting concern not only of ALPA’s national officers, but of rank-and-file line pilots as well. Clearly, Ferris’s grandiose plans to make the airline but one cog in “Allegis,” his “integrated transportation company that would remake the industry” (to quote him) struck most United pilots as dubious. They had a healthy suspicion of diluting the company’s basic business, which was flying airplanes, with risky expansions into areas in which United had limited experience, such as hotels and car rentals. Put simply, they feared that Ferris’s incompetence would do to United what Harding Lawrence’s unchecked grandiosity had done to Braniff.
Eventually, United’s pilots, acting on plans Roger Hall had concocted under a cloak of secrecy approximating the Manhattan Project, would try to wrest control of the airline from Ferris and Allegis. Through an instrument unique to “progressive capitalism,” an employee stock ownership plan (ESOP), Hall led United’s pilots into a full-blown attempt to buy their own airline. Although this audacious poststrike effort failed to achieve its primary goal of an employee-owned airline during the period of time covered by this history, it did succeed in ousting Ferris. In 1987, largely because of stresses that the ESOP battle generated, United’s board replaced Ferris with Continental’s former president, Stephen Wolf, who had at least some credibility with pilots because he broke with Lorenzo just before the Continental strike.
As we shall see later, the ESOP effort had a far-reaching effect because it returned United to its airline roots, thus warning every airline executive in the industry that pilots would take extreme financial countermeasures to preserve their profession, and that reckless corporate maneuvers would invite retaliation. The fall of Dick Ferris was a warning to every executive in the industry that their actions could have profound personal consequences.
But all that was in the future. For the present, 1985, negotiations deadlocked over Ferris’s insistence on givebacks that almost made Blue Skies look good by comparison, among them a B-scale like Crandall’s. In April 1985, John LeRoy pointed out at the annual stockholders meeting that United’s pilot pay scales were already lower than American’s. But Ferris, answering LeRoy from the podium, insisted on comparisons with Continental’s pilot pay!
“Does it make sense to damage the corporation over this?” LeRoy asked the assembled stockholders, while outside uniformed pilots conducted an “informational picket.”
United’s pilots were in no mood to make Continental-style concessions, for under Blue Skies the company had returned to profitability. Roger Hall, a methodical man who took on one problem at a time, would not let Ferris stampede him. While the unproductive talks dragged on, United’s pilots were far from idle. To pressure Ferris into signing a decent contract, the pilots had, in 1984, tried various forms of in-cockpit job actions, most notably a program they called “Withdrawal of Enthusiasm,” or WOE, essentially the ancient tactic of “working to the book,” doing just what the job required and no more.
But nothing worked. The ultimate test loomed, with the question hanging in the air like MacBeth’s ghostly dagger—would United’s pilots actually strike? Each pilot had to make that decision alone—there would be no place to hide. Against that moment of truth, Roger Hall and Rick Dubinsky, assisted by many others (the Strike Committee had expanded to 20 members by then) laid their plans and made their preparations, insisting that nothing be left to chance, so that no distractions would divert United’s pilots from the main matter.
One bright spot emerged. Should it come to a strike, money would not be a problem. For years, United had paid more into ALPA’s national treasury than any other pilot group. Now they wanted it back. Hank Duffy, still embroiled in the long contest at Continental, knew the stakes as he met with Rick Dubinsky in late 1984 to talk about money.
“Dubinsky and his leadership group came to Washington, D.C., several months before the strike and laid out their program for me,” Duffy recalled in his 1990 interview. “They talked about some unusual preparations, for example ‘family awareness groups,’ that needed extra funding. It made a lot of sense, and I approved it. At the time, I thought we were talking about half a million dollars. They wound up spending nearly $2 million in preparation, but well worth it in the results we got. Typical of the United pilot group, they did very careful planning.”
The United pilot investigators, early in their study of what went wrong at Continental, isolated the role of spouses, which, as we have seen, proved critical. The key to keeping family members on board would be prestrike education about ALPA’s history and role, plus innovative communications during the strike, entailing many novel approaches, such as regular videotape updates, traditional telephone chains, and nontraditional satellite communications links among mass meetings at United’s various domiciles. All this would not only cost a lot of money, but also require months of advance preparation. Rick Dubinsky’s study group, now officially designated the Strike Committee, began receiving full funding from ALPA in October 1984.
Eventually the 29-day strike would cost ALPA $10 million, and that did not include any strike benefits to United’s pilots. Everybody knew that if, on the heels of the Continental debacle, United’s pilots lost this battle to Dick Ferris, ALPA’s future looked dim. In a very real sense, United’s pilots would be fighting for ALPA’s survival. The stakes were so high nearly everybody was “in denial,” as psychological jargon puts it, hoping against hope that a strike wouldn’t happen.
“It was about March 1985 when I finally felt that Ferris had made the decision to maneuver us into a strike,” says Roger Hall. “He was convinced he could win a strike. I talked with Hank Duffy about the difficulties we were having with negotiations, but his feeling was that it wouldn’t come to an all-out confrontation.”
Duffy agrees with Hall’s recollection, noting that United’s corporate history indicated a preference for accommodation with labor, rather than confrontation. Then Duffy had a personal encounter with Dick Ferris—in full bluster—which indicated otherwise.
“About three weeks before the strike. Ferris came into my office, took off his coat (he’s a very muscular guy), and sat on the arm of a chair so as to purposely look down at me,” Duffy said in his 1990 interview, laughing at this sophomoric intimidation tactic. “They must have taught him this trick at the Cornell hotel school. Ferris then proceeded to tell me that if there was a strike he already had a group of working pilots, that he’d have 10 percent operations by the first week, 20 percent by the end of the first month, 30 percent by the second month, and at that point our people would crack. He said he had a $1 billion line of credit that he was perfectly willing to use, that we were broke, and that there was no way we could stand that. This was a huge ego we were dealing with. Somewhere along the way, he’d decided he could hammer us.”
As summer approached and negotiations remained deadlocked, Ferris rather surprisingly made an attack on Rick Dubinsky the centerpiece of his appeals to the United pilot group, going over the heads of their elected representatives. By this time, the Strike Committee was in full battle harness, and Dubinsky was visibly and combatively out front, bringing the same energy and drive to the task that he had invested five years earlier in Operation USA, which first gained him a measure of national attention. Perhaps Ferris listened to Ferg, who told him Dubinksy was too radical, or he had heard that some pilots had alliteratively nicknamed him “Mad Dog.” Back in 1975, as a very young MEC secretary-treasurer, Dubinsky had angrily resigned over Bill Arsenault’s recall, an episode some United pilots still remembered with distaste.
As part of Ferris’s ill-fated “road show” between April 29 and May 5, which the pilots generally boycotted, he floated the canard that Dubinsky was willing to lead the strike only because he was independently wealthy and didn’t need his job! This classic bit of disinformation actually had many United pilots believing it.
“That was a story the company was spreading going into the strike,” says Dubinsky. “Corporate leaders are capable of the basest actions imaginable. They were trying to discredit my leadership, because if I had nothing to risk, what did I care if we went on strike?”
In fact, Dubinsky insists he was as dependent on his salary as any other pilot, despite a settlement he had received from a hospital because of negligence in the death of his wife some years earlier. The son of a union meatcutter from St. Louis, Dubinsky had grown up in a working class family. While studying mechanical engineering, he worked part-time as a research assistant for Monsanto, the St. Louis chemical giant. He paid for his own flying lessons, and United hired him during the 1965 pilot shortage. Dubinsky had 275 total hours at the time. In the early 1970s, Dubinsky achieved some fleeting notoriety as one of the “hair grievers.” United insisted on military haircuts for line pilots, regardless of the modishly long styles then in fashion. Because corporate regulations on hair length were imprecise and clashed with the ideals of several young pilots, they filed grievances. This episode illustrated not only a bit of nutty historical trivia, but also Dubinsky’s willingness to resist authority when he thought it wrong, a trait he picked up while working for Monsanto.
“I absolutely cannot abide the arbitrary exercise of power over people when there’s no good reason for it,” says Dubinsky. “At Monsanto, I worked with some extremely talented engineers who put their heart and soul into projects, lived for months and years making products, not so much for the compensation as for love of the process. Yet, some bean counter could cut them off at the knees with two weeks’ notice. It was devastating, and they had nothing to say about it. From my first exposure to ALPA, I saw that unionism was the reason airline pilots didn’t have to put up with that, or get on their knees to anybody.”
Roger Hall entrusted leadership of the strike to Dubinsky for a variety of reasons.
“Rick was a strong unionist, and I had high respect for his organizational ability, the way he could lead a group,” Hall explains. “He had sort of separated himself from Ferg during the Blue Skies period, he was not at all in agreement with it, so he seemed to me an ideal person to organize and lead the strike.”
In April 1985, United’s pilots got final proof that no concession short of abject surrender would avert a strike. United’s pilot negotiators agreed to some form of B-scale—in principle. It was a major concession, one that the pilots believed would be the basis for further negotiations leading to a settlement. But to make sure that Ferris didn’t interpret this concession as a sign of weakness, United’s MEC also recommended a strike authorization vote. United’s 5,000 pilots supported their leaders by approving a walkout, set for May 17, 1985. Armed with this authorization, intensive negotiations under National Mediation Board auspices entered the final phase. Hank Duffy, following these developments closely, still believed a settlement likely.
“I thought Ferris was like Bob Crandall, in that he would take on the unions but that he was not suicidal,” Duffy said in 1990 of his meeting with Ferris. “Our people were trying to be reasonable, and I thought right up to the eve of the strike that Ferris would see that and make a settlement. For all his bluster, he said he was open to further discussions. So I set up another meeting between him and Roger Hall, but that didn’t go anywhere.”
Finally, with the traditional high-traffic months of summer nearing, the two sides reached an impasse, and the NMB “released” the parties, freeing them to engage in self-help. In the last negotiations, attention focused not on Ferris’s demand for a B-scale (which United’s pilots had already conceded), but on its nature. Ferris wanted a B-scale that would end for new-hires only after they made captain, which meant, in effect, that it would penalize the next generation of United pilots well into paunchy, balding middle age. If history was any guide (which in this case it wasn’t), no United new-hire could expect to make captain for at least 20 years. The pilots held out for a B-scale that would merge after six years. American’s B-scale at that time would never merge.
As the May 17 strike deadline neared, Ferris played his trump card. Through carefully orchestrated news releases, Ferris announced that he would hire “permanent replacements” in the event of a strike. To put teeth in his threat, Ferris had, since December 1984, trained, but not hired, 570 new second officers, telling them that they would be used for “expansion.” Clearly, Ferris expected to lure first officers across the picket line with promises of instant captaincies and to use “the 570” (as they came to be known) to fill out scab crews. The 570 were thus in an anomalous position, clearly contingent scabs, having neither union protection nor standing as employees.
Only happenstance let United’s pilots know about the 570 or the nasty surprise Ferris intended them to be. Ferris had trained them quietly in small groups at United’s Denver training center, a very large facility where anonymity is the rule, and the 570 went virtually undetected. But Jamie Lindsey, a second-generation airline pilot whose father had flown for both United and American, became concerned about them while he was undergoing first officer upgrade training in January 1985.
“Several people had wondered who these people at Denver with strange nametags were,” says Lindsey. “But I was the only one dumb enough to walk up and ask one of them directly.”
The young trainees with the odd nametags told Lindsey they were “pre-hires” who would be coming on the line as soon as ALPA signed a new contract. Lindsey, who had been an active “committee puke” at the MEC level, promptly phoned Roger Hall in Chicago to find out what he knew about them—which was nothing. Delegated by Hall to investigate these strange creatures further, Lindsey discovered that they were receiving only 19 days of training instead of the usual four to six weeks, that they were being paid a flat per diem rate of $26, with no allowance for either food or lodging, and that they were as bewildered about their status as ALPA was about them.
“Contacting them was real easy,” Lindsey laughs. “All I had to do was put up a sign that said, ‘Pre-hires Welcome Meeting, ALPA—FREE FOOD.’”
In short order, it became clear to everybody that the 570 were a strikebreaker force in training and that ALPA had better reach them quickly. With the assistance of Steve Forte, Bruce Lasch, and Raoul Bouher, Lindsey set up a systematic “contact program” aimed at the 570 as they came through the Denver training center each month. A key element in Lindsey’s “outreach” program involved offering the “pre-hires” tutoring and a “study hall” each evening staffed by ALPA volunteers. Since the 570 were getting nonstandard training but still had to go through the regular exams, they were very grateful. This assistance proved to the 570 in concrete terms that ALPA was more interested in their welfare than was management.
But ALPA had other things than the 570 to worry about. On May 1, 1985, United began advertising for “fleet qualified” pilots who could step immediately into United cockpits. Ferris offered potential scabs “personal services” contracts, which paid captains a flat salary of $75,000 per year and noncaptains $50,000.
Ferris’s actions infuriated United’s line pilots, who knew that United was already canceling revenue flights because it lacked crews. The 570 were needed immediately, but Ferris kept them off the line as part of his prestrike maneuvering.
To thwart him, ALPA representatives made sure the 570 were fully aware that by resisting a nonmerging B-scale, ALPA was fighting their battle. Still, no one could be sure what the 570 would do, and ALPA had no way of influencing (or even contacting) the “fleet qualified” applicants.
So current United pilots themselves would win or lose the strike. If Ferris could get a “critical mass” of pilots to cross early enough in the strike, he would win. United’s pilots were fully aware that Lorenzo had won at Continental because just such a critical mass deserted the strike early on. It was an unstated fact that, if such a critical mass crossed, United’s pilot leaders would have to call down the strike and admit defeat. But how many pilots would that be?
“I knew going into the strike that if the line started to crumble, we were going to have to settle,” Roger Hall admits. “If we lost more than 15 percent, that was my mental number, we would have to take whatever terms were there.”
And so the strike came.
On May 17, United’s 5,000 pilots “hit the bricks” like any traditional labor union, picket signs in hand. It was the moment of truth, for down deep, each striker knew that the best job in the world was at stake. One popular lapel button said it all: “Cross and the Great Job Dies!” Each striker’s story was different, yet somehow the same. It became a shared moment like none other save combat, the kind of experience that would later be taken out and unwrapped, like a precious heirloom, to be examined at leisure in a thousand pilot lounge conversations.
Whatever United’s pilots were before the strike, they would never be the same afterward. For those who stood the test and now wear their “battle star” lapel pins (designed to instantly identify scabs, to whom no ALPA loyalist will speak socially outside the line of duty), who so rattled scabs by “clicking” children’s’ Halloween noisemakers as each one walked into their pilot lounges that Ferris finally had to get a humiliating court order against it, the strike lives in memory. It was a transforming moment akin to the experience Civil War soldiers would recall through the haze of years: Chickamauga, Antietam, Shiloh. This litany of humble U.S. placenames forever etched in memory would have counterparts in United’s strike lore.
How could you tell a scab? He was the guy in the toilet stall with his baggage stuffed in, too, lest it get sent to Hong Kong. Veterans of the strike tell these stories and smile. What those who broke faith and crossed the picket line do as they look each morning into their mirrors, no one can say.
One thing any airline executive should always think about before provoking a strike—it gives pilots a chance to get to know each other. Most pilots lead professional lives of relative isolation, never really getting acquainted with very many of their colleagues. During normal operations, a big percentage are always flying. But in a strike, with everybody grounded and engaged in a cooperative effort, real solidarity and attendant friendships can emerge.
“We developed great closeness during the strike, many friendships that are still very strong with United people living half a mile from us that we didn’t even know,” says Bill Stewart, whose view from the trenches in Los Angeles will have to serve as surrogate for the stories of 5,000 other pilots. “Six months before the strike, if asked about it, I’d have probably said, ‘Well, I’ll try it for a while, but I can’t risk my whole career just because the union tells me to.’ But as we got into the strike, we discovered, Hey, we’re not some kind of white collar professional association, we’re a labor union, and if we don’t stand together, they’ll kill us individually. We had 95 percent honoring the picket line that first day, and that didn’t change an awful lot. You’re talking about people who never went to ALPA meetings, who all of a sudden realized what the situation was. So, ever since then, we’ve had this comradeship, or this togetherness, or this unity, whatever you want to call it, because it became painfully obvious that this was a noneconomic strike aimed at destroying us as a profession.”
Round one went to ALPA, when all but 6 of the 570 not-quite-hired second officers refused to work. This development was critical, because if the 570 had crossed, it might have undermined many weak or greedy first officers who would have jumped at the chance to achieve “instant captaincies.” Stung by the refusal of all but 6 of the 570 to cross the picket line, Ferris accelerated his hiring of permanent replacement “fleet qualified” scabs, but he couldn’t find enough of them to break the strike. It all came down to the same old rub—United’s pilots could control their own fate if they could hold their own lines.
On May 1, Ferris had predicted to the Chicago Tribune that 40 percent of his pilots would cross the picket line. Keeping in mind his private prediction to Hank Duffy that he expected victory when 30 percent crossed, how close did he come?
“Rick Dubinsky predicted that we would lose no more than 4 percent the first 48 hours, and that prognosis was essentially correct,” says Roger Hall of the critical early hours. “Ferris was convinced that he would have 20 percent across the line within five days, and Ferg was telling him the strike would crumble within 48 hours or less. After 29 days, we ended up right at 6 percent who went to work, and that held.”
Confronted by a unified pilot group, with the strike costing United literally millions each day, Ferris reluctantly, under shareholder and lender pressure, agreed to a five-year B-scale with negotiations and binding arbitration to follow. He could have had such an agreement earlier with far less trouble and expense. By the simple act of sustaining their picket lines, United’s pilots had succeeded in calling his bluff. The B-scale game was no longer worth the candle, so five days after the strike’s inception, Ferris settled.
The strike would continue for another 24 days because of difficulties over the back-to-work agreement, often the most wrenching aspect of any strike. At issue was the fate of the 570 and the flight attendants who had honored ALPA’s lines. Ferris had also sent termination notices to a number of strike leaders, including Rick Dubinsky, which created another stumbling block.
“It was vindictive and just strengthened the resolve of the pilots,” says Hall, who did not get one of the dozen termination letters. “There was no way the pilots would go back under those circumstances, and sane people in management knew it.”
When the strike finally ended on June 14, critical post-mortems began coming in from outside. Pilots from other airlines, perhaps reflecting a touch of envy, spoke of the United pilot group “leaving their wounded on the battlefield.” Stories circulated that United’s pilots called down their strike only because massive numbers were on the verge of crossing. Such speculative disaster scenarios, like all “what ifs” in history, can be neither proven nor disproven. But Roger Hall offers a patient, logical explanation for which corroboration exists.
“At 26 days into the strike, the line was holding very well,” Hall insists. “We legally had no choice but to settle the status of the 570 through court action, and the only remaining issue was the flight attendants getting a back-to-work agreement. At that point, Patty Friend [president of United’s Association of Flight Attendants unit] came to me and said, ‘We want you to go back to work. We cannot negotiate a back-to-work agreement; we intend to go to court, but our people need to get back to work, and the only way they can do that is if the airplanes are flying.’ We gave financial support to the flight attendants until they got back to work, and eventually they were successful in court.”
“We were accused of paying blood money for leaving our wounded, the flight attendants, on the battlefield,” says Hank Duffy, confirming Hall’s account. “But that’s not it at all. They asked us to go back—at the national level they asked me, and at the local level they asked Roger. The flight attendants could not stay out any longer. They said, ‘If you have an agreement, go back, because financially our organization is broken, and we have got to go back to work.’ They asked for financial assistance later. They gave us absolution to go back because it was in their interests. Our people did all the honorable things in that strike.”
As to the speculative charges, which are incapable of proof or disproof, that massive numbers of United pilots were preparing to cross the line if the strike had gone on only a few more days, all one can say is if that were true, it constitutes a tribute to the leadership and perspicacity of Roger Hall and Rick Dubinsky. The essential attribute of strike leadership is to recognize the precise moment, neither too late nor too early, when the time to settle arrives. Too late, and a strike becomes a holy war, which means that even in victory, the union loses because it destroys its company or its own jobs, as the Eastern strike of 1989 proved.
“If the tide was changing, then Roger Hall was very good at sensing it, and he caught it just as it changed, before we had to deal from an adverse position,” says Hank Duffy. “But they were winning.”
At the very worst, United’s pilots won a clear-cut draw. Given the way things had been going recently for ALPA, that counted as a victory. Criticizing the outcome of the strike is a little like complaining about George Washington running away from the British early in the American Revolution. During the Battles of Long Island and Brooklyn Heights, Washington realized that, by pressing the issue, he risked getting cut off from the mainland. So he disengaged, strategically retreated his army across the Hudson River into New Jersey, and kept intact his striking power, the fabled Continental Blues, made up primarily of long-term enlistees. So long as Washington’s army remained whole, the Revolution and the nation lived. But if Washington pressed a battle past the point of prudence, he risked not only losing just a battle, but everything. Only the last battle in a war counts.
ALPA was in the midst of what would inevitably be a long war. Deregulation had wrought changes that profoundly altered the relationship between labor and management. United’s pilots fought ALPA’s Battle of Long Island in 1985. If they had lost, their epitaph would also have been ALPA’s as a viable union. Their victory, however qualified, proved to be a watershed, for aside from Frank Lorenzo’s suicidal attempt on Eastern, it discouraged any further assaults on ALPA during the 1980s.
In one sense, United’s pilots came away with a clear-cut victory, for they had dared to strike and, once engaged, had held their ranks against a determined opponent. They were still fit to fight at the end, but to have pressed the strike to a finish over the 570 or the flight attendants would have been foolish. Although for while the 570 lost, on average, something like 600 numbers of seniority to scabs (and some nonscabs hired after the strike), ALPA’s legal actions eventually won for them the right to fly the line without betraying their professional heritage—at a stiff price, but in the opinion of many, well worth it. In 1993, ALPA won a complete victory for the 570, when the courts ruled that United had illegally denied them their rightful seniority. They were immediately jumped over the 600 scabs who had been hired during the strike.
Every professional airline pilot still covered by an ALPA contract owes the 570 a debt of gratitude. By courageously acting in concert with United’s striking pilots, the 570 allowed the pilots to settle the issue directly, without fear of their flank crumbling.
United’s pilots had stanched the debilitating slide that had afflicted ALPA since the onset of deregulation. They had bought the profession time. It was now up to the “politicians” in ALPA’s national offices to make the most of it.