Flight Options, LLC et al v. Local 1108 International Brotherhood of Teamsters et al

Filing 33

Opinion & Order signed by Judge James S. Gwin on 5/25/16. The Court, for the reasons set forth in this order, grants the motion of Counter-Plaintiffs International Brotherhood of Teamsters, Airline Division and Teamster Local Union 1108 for p reliminary injunction and orders Counter-Defendants Flight Options, LLC, Flexjet, LLC, Onesky Flight, LLC, and Flight Options Holdings I, Inc., to accept the integrated seniority list, rescind the voluntary separation package and bargain in good faith with Counter-Plaintiffs. (Related Doc. 10 ) (D,MA)

UNITED STATES DISTRICT COURT
NORTHERN DISTRICT OF OHIO
_____________________________________
FLIGHT OPTIONS, LLC and
FLEXJET, LLC,
Plaintiffs,
v.

No. 1:16-cv-00732

INTERNATIONAL BROTHERHOOD OF
TEAMSTERS, LOCAL 1108; INTERNATIONAL
BROTHERHOOD OF TEAMSTERS; and
BROTHERHOOD OF
TEAMSTERS, AIRLINE DIVISION,
Defendants.

Opinion and Order
[Resolving Doc. 10]

and
INTERNATIONAL BROTHERHOOD OF
TEAMSTERS, AIRLINE DIVISION, and
TEAMSTERS LOCAL UNION 1108,
Counter-Plaintiffs,
v.
FLIGHT OPTIONS, LLC; FLEXJET, LLC;
ONESKY FLIGHT, LLC; and FLIGHT OPTIONS
HOLDINGS I, INC.,
Counter-Defendants.
______________________________________
JAMES S. GWIN, UNITED STATES DISTRICT JUDGE:
On April 22, 2016, Counter-Plaintiffs International Brotherhood of Teamsters et al.
(“Pilots Union”) filed a motion for preliminary injunction and temporary restraining order
against Counter-Defendants Flight Options, et al. (“The Carriers”).1 On May 11, 2016, the Court
held a hearing that consolidated the temporary restraining order hearing with the preliminary
injunction hearing.2

1
2

Doc. 10. Counter-Defendants Opposed Doc. 13. Counter-Plaintiffs Replied Doc. 18.
See Docket Order dated May 2, 2016.

1

Case No.16-CV-732
Gwin, J.
This case concerns disputes between Pilots Union and the Carriers arising out of the
merger of two luxury jet airline carriers: Flexjet and Flight Options. The Court decides whether
the Carriers and the Pilots Union entered a contract that gave the Pilots Union the responsibility
to establish a seniority ranking after the Carriers acquired control of a related flight company.
The Court also decides whether the Carriers were required to bargain with the Pilots Union
before the Carriers offered separation packages.
For the reasons below, this Court GRANTS the motion for preliminary injunction and
ORDERS the Counter-Defendants Carriers to accept the integrated seniority list, rescind the
voluntary separation package and bargain in good faith with Counter-Plaintiffs Pilots Union.
Factual Background
Counterclaim-Defendants Flexjet and Flight Options provide fractional jet ownership and
luxury jet travel. Flexjet employs approximately 320 pilots while Flight Options employs
approximately 370 pilots.3 Counterclaim-Defendant OneSky owns both Flexjet and Flight
Options.
The Pilots Union acts as the certified collective bargaining representative for Defendant
Flight Options pilots.
The Pilots Union and Flight Options negotiated a collective bargaining agreement that
became effective on March 31, 2010.4 As part of the negotiations, Flight Options’ parent holding
companies executed a 2010 letter of agreement with the Pilots Union. That holding company
letter of agreement required the holding companies to follow certain Flight Options collective
bargaining agreement provisions. In the letter agreement, the OneSky holding company agreed
to the method it would use to merge seniority listings in any later similar acquisition.

3
4

Doc. 10-1 at 2.
Doc. 8-2.

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Case No.16-CV-732
Gwin, J.
That letter agreement provides that “The Holding companies and Flight Options and their
affiliates . . . shall be subject to all terms and conditions of Section 1 of the Flight Options/[Pilots
Union] CBA (as it presently exists or as subsequently amended) as if all references to Flight
Options and/or the Company expressly referred to the Holding Companies, any of them, or their
affiliates.”5 The Letter of Agreement then goes on to explain that the agreement “shall be binding
on any Successor to Flight Options, the holding companies, any of them, or any Successor
thereto.”6
The Letter of Agreement also requires affiliated companies comply with CBA pilot
seniority consolidation provisions. The letter agreement states, “Upon acquisition by holdings I
of a controlling interest in an air carrier . . . the acquired air carrier shall be consolidated utilizing
the procedure for Successor Transactions set forth in Section 1.5 of the Flight Options/[Pilots
Union] CBA.”7
In December 2013, OneSky acquired a controlling interest in Flexjet, and announced an
operational merger between Flexjet and Flight Options.
After a contested representation election, on December 16, 2015, the National Mediation
Board certified Counter-Plaintiffs Pilots Union as the bargaining representative of the combined
unit of Counter-Defendants Flexjet and Flight Options pilots.8
Section 1.5(c) of the Flight Options – Pilots Union collective bargaining agreement
addresses pilot protections when Flight Options, or its parent company, acquires an air carrier.9
5

Id.
Id.
7
Id.
8
Doc. 9 at ¶4.
9
1.5(c)(1) If Pilots of the acquired carrier are hired by the Company, the seniority lists of the respective Pilot groups
shall be integrated pursuant to Teamsters Merger Policy if both groups are represented by the [Pilots Union], or if
the Pilots of the acquired airline are not represented by the [Pilots Union], then pursuant to Sections 3 and 13 of the
Allegheny-Mohawk Labor Protective Provisions. Seniority integration procedures shall be promptly initiated
following announcement of an operational merger affecting the seniority of the pilot groups. The Company or other
Successor, as appropriate, shall accept the integrated seniority list. There shall be no system flush or
6

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Case No.16-CV-732
Gwin, J.
When one union represents both merging bargaining units, the CBA agrees that the Pilots Union
will use internal union procedure to prepare a combined seniority list.
After the merger announcement, the Pilots Union began seniority integration procedures
with a committee comprised of three Flexjet pilots and three Flight Options pilots.10 The Pilots
Union says it chose these representatives to fairly represent pilots in their respective units.
When assembling a combined seniority list, many policy decisions became involved.
And these policy decisions mostly existed independent of the merged seniority lists. At both
Flight Options and Flexjet, pilots had taken leave of absences, including leaves for military
service. Flight Option pilots had been furloughed. Some pilots had flown for predecessor

removal of Pilots from their positions as a result of seniority list integration.
1.5(c)(2) Prior to integration of Seniority Lists in accordance with paragraph 1.5(c)(1), above, the parties shall
negotiate a mutually agreeable fence agreement. The fences shall remain in effect for the period of time the acquired
carrier continues as a separate transportation system. Until the fences are removed, all aircraft (including orders and
options to purchase aircraft) and the operations of each pre-transaction carrier shall remain separated. If the fence
agreement cannot be reached within 60 days of a request by either party to begin negotiations, all unresolved issues
shall be submitted to interest arbitration. The arbitrator’s resolution of the
disputed issues shall be on an issue-by-issue basis, rather than a “total package” basis, and shall be binding on the
parties with respect to the particular dispute, but shall have no precedential or binding effect on other or future
disputes arising under this subparagraph.
1.5(c)(3) Unless and until an operational merger is finally effectuated, the Union shall continue to be recognized as
the representative of the premerger Pilot craft or class to the extent provided by law. In the event of an operational
merger, the representative of the post-merger craft or class
shall be established pursuant to Section 2, Ninth of the Railway Labor Act, as amended.
1.5(c)(4) If Pilots of the acquired carrier are hired by the Company, the Agreement shall be modified in those
respects necessary to permit the integration through negotiations between the surviving air carrier and the
representative of the consolidated, post-merger Pilot craft or class. If a modified agreement is not executed within
nine months from the date a final and binding integrated Pilot Seniority List is issued, the parties shall submit
outstanding issues to binding interest arbitration. The arbitrator’s resolution of the disputed issues shall be on an
issue-by-issue basis, rather than a “total package” basis, and shall be binding on the parties with respect to the
particular dispute, but shall have no precedential or binding effect on other or future disputes arising under this
subparagraph. Until such time as a fully merged agreement is reached, either through bargaining or arbitration, the
surviving air carrier may continue to operate
the two carriers separately.
1.5(c)(5) The Company may operate the acquired carrier under the parties’ fence agreement for a reasonable period
following acquisition.
10
Doc. 31 at 128.

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Case No.16-CV-732
Gwin, J.
companies. How to treat these periods impacted individual pilot seniority but did not
systemically advantage either Flight Option pilots or Flexjet pilots.
On February 24, 2016, the Pilots Union presented the integrated list to the Carriers Chief
Executive Officer. On the same day, the Pilots Union also sent another letter to the Carriers
Chief Executive “to serve as notice in accordance with Section 6, Title I of the Railway Labor
Act (RLA) . . . of the Union’s intent to open and commence negotiations between the parties for
the purposes of amending the CBA to apply to the entire combined craft or class of Flight
Options and Flexjet Pilots . . .”11
On February 26, 2016, the Carriers rejected the integrated list on the basis that it “does
not comply with McCaskill-Bond.” The letter also stated that “the company does not agree that
these Section 1.5(c)(4) negotiations trigger the Section 6 status quo obligation.”12
On March 3, 2016, the Pilots Union responded and again demanded to bargain under
Section 6 of the RLA as well as over whatever issues existed over the integrated list. The
Carriers have refused to bargain with the Pilots Union as requested in the Pilots Union’s March
3, 2016, letter.
On March 23, 2016, the Carriers filed a complaint in this Court seeking declaratory
judgment “that the [Pilots Union’s] actions violate McCaskill-Bond, that the [Pilots Union] and
the representatives of the Flexjet pilots must collectively bargain with the Carriers for a fair and
equitable seniority integration under McCaskill-Bond, that the Flexjet pilots are entitled to their
Doc. 9 at ¶ 20. Section 6 of the RLA, 45 U.S.C. § 156, provides that: “[Carriers] and representatives of the
employees shall give at least thirty days’ written notice of an intended change in agreements affecting rates of pay,
rules or working conditions, and the time and place for the beginning of conference between the representatives of
the parties interested in such intended changes shall be agreed upon within ten days after the receipt of said notice,
and said time shall be within the thirty days provided in the notice. In every case where such notice of intended
changes has been given, or conferences are being held with reference thereto, or the services of the Mediation Board
have been requested by either party, or said Board has proffered its services, rates of pay, rules or working
conditions shall not be altered by the carrier until the controversy has been fully acted upon, as required by section
155 of this title, by the Mediation Board, unless a period of ten days has elapsed after termination of conferences
without request for or proffer of the services of the Mediation Board.”
12
Doc. 10-1 at 9.
11

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Case No.16-CV-732
Gwin, J.
own representative, and that the purported ISL presented to Flight Options by the [Pilots Union]
on February 24, 2016 did not comply with McCaskill-Bond.”13
The Pilots Union claims the Carriers have not negotiated in good faith. After the Carriers
buy a related flight business, the collective bargaining agreement requires fence bargaining to
negotiate job responsibilities for current pilots and the pilots of the newly purchased flight
company. On March 31, 2016, the Pilots Union met with the Carriers to negotiate over a Fence
Agreement under Section 1.5(c) of the collective bargaining agreement.
The parties did not reach a fence agreement, and the Pilots Union characterized the
Carriers’ negotiations as “surface-level” and “regressive.”14 At the preliminary injunction
hearing, Flight Options pilot and Pilots Union local 1108 business agent Laddie Hostalek
testified that fence negotiations began in December 2013 and Pilots Union had been meeting
with the Carriers every month or every other month to negotiate the fence agreement.15 Hostalek
testified that the Carriers offered minimal, and widely spaced, available bargaining dates.16 The
parties are now scheduled to meet again regarding the Fence Agreement in June 2016.
The Pilots Union also complains that the Carriers failed to bargain over a pilot separation
program. On March 31, 2016, the Carriers presented the Pilots Union with a voluntary
separation package (“VSP”) for pilots at Flight Options and Flexjet. Counter-Plaintiffs Pilots
Union say that the Carriers are required to bargain with the Pilots Union over the separation
package and say the Carriers refused to meet face to face to bargain over the proposed VSP.
Instead, on April 22, 2016, the Carriers offered the VSP to Flight Options pilots without giving
the Pilots Union any chance to bargain .17

13

Doc. 1.
Doc. 10-1 at 28-29.
15
Doc. 31 at 69.
16
Id. at 93.
17
Id. at 15-17.
14

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Case No.16-CV-732
Gwin, J.
On April 22, 2016, Counter-Plaintiffs Pilots Union filed a motion for preliminary
injunction asking this Court to order the Carriers to bargain over rates of pay, rules and working
condition and to rescind the VSP until bargaining has occurred. The Pilots Union also asks this
Court to find that the integrated seniority list is “fair and equitable” or alternatively to order the
Carriers to arbitrate the “fair and equitable” nature of the integrated seniority list.18
Law and Discussion
A district court’s decision to grant a preliminary injunction under the Railway Labor Act
rests within that court’s discretion.19 In considering whether to use a preliminary injunction,
courts weigh: “(1) whether the movant has demonstrated a substantial likelihood of success on
the merits; (2) whether the movant will suffer irreparable injury without the injunction; (3) would
the preliminary injunction cause substantial harm to others; and (4) will the public interest be
served if the injunction issues.”20
However, in a RLA labor dispute, a district court may “enjoin a violation of the status
quo pending completion of the required procedures, without the customary showing of
irreparable injury.”21
The Railway Labor Act provides,
It shall be the duty of all carriers, their officers, agents, and
employees to exert every reasonable effort to make and maintain
agreements concerning rates of pay, rules, and working conditions,
and to settle all disputes, whether arising out of the application of
such agreements or otherwise, in order to avoid any interruption to
commerce or to the operation of any carrier growing out of any
dispute between the carrier and the employees thereof.22

18

Doc. 10.
Adams v. Fed. Express Corp., 547 F.2d 319, 322 (6th Cir. 1976) (citing other cases).
20
Overstreet v. Lexington-Fayette Urban Cty. Gov’t, 305 F.3d 566, 573 (6th Cir. 2002).
21
Consol. Rail Corp. v. Ry. Labor Executives’ Ass’n, 491 U.S. 299, 303 (1989).
22
45 U.S.C. § 152.
19

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Case No.16-CV-732
Gwin, J.
The RLA distinguishes between two categories of labor disputes: “disputes concerning
the making of collective agreements,” known as major disputes, and “disputes over grievances,”
known as minor disputes.23 Major disputes give federal courts jurisdiction; minor disputes must
be submitted to binding arbitration.
The Sixth Circuit recently described the difference between major and minor disputes.
The Sixth Circuit said that a major dispute is one that arises “where a CBA does not exist or
where one of the parties seeks to change the terms of an existing CBA. The issue in a major
dispute ‘is not whether an existing agreement controls the controversy’; instead, the focus is on
the ‘acquisition of rights for the future, not [the] assertion of rights claimed to have vested in the
past.’”24 The Sixth Circuit also found that major disputes arise when a party makes a claim that is
“frivolous or obviously insubstantial in light of the express language” of the underlying
agreement.25
The Pilots Union’s preliminary injunction motion specifically involves two disputes: the
integrated seniority list and the voluntary separation program. This Court examines each dispute
in turn.
Integrated Seniority List
As an initial matter, the integrated seniority list dispute is a “major dispute” because its
focus is on the “acquisition of rights for the future” rather than “rights claimed to have vested in
the past.”26 This Court enjoys jurisdiction over the integrated seniority list dispute.
As will be described, the Carriers and the Pilots Union agreed to a collective bargaining
agreement that gave the Pilots Union responsibility to assemble the seniority list. Under its
23

Elgin, J. & E. Ry. Co. v. Burley, 325 U.S. 711, 722 (1945).
Wheeling & Lake Erie Ry. Co. v. Bhd. of Locomotive Engineers & Trainmen, 789 F.3d 681, 690 (6th Cir. 2015)
(quoting Burley, 325 U.S. at 725).
25
Id. at 692.
26
Id.
24

8

Case No.16-CV-732
Gwin, J.
contract with the Pilots Union, the Counter-Defendants Carriers were required to accept the
integrated seniority list when it was presented.
Even if the collective bargaining agreement had not given the union responsibility for
merging the seniority lists, the Pilots Union used a “fair and equitable” process as required by
Allegheny-Mohawk Sections 3 and 13.27 Nothing shows that the Pilots Union’s process was not
fair and equitable.
Section 1.5(c)(1) of the Carriers – Pilots Union collective bargaining agreement gives the
union, not the Carriers, the responsibility to create the seniority list. That section states

1.5(c) Pilot Protections in the Event of an Acquisition of an Air
Carrier
1.5(c)(1) If Pilots of the acquired carrier are hired by the Company,
the seniority lists of the respective Pilot groups shall be integrated
pursuant to Teamsters Merger Policy if both groups are
represented by the [Pilots Union], or if the Pilots of the acquired
airline are not represented by the [Pilots Union], then pursuant to
Sections 3 and 13 of the Allegheny-Mohawk Labor Protective
Provisions. Seniority integration procedures shall be promptly
initiated following announcement of an operational merger
affecting the seniority of the pilot groups. The Company or other
Successor, as appropriate, shall accept the integrated seniority list.
There shall be no system flush or removal of Pilots from their
positions as a result of seniority list integration. (Emphasis added.)
Because both groups were represented by the Pilots Union, the Teamsters Merger Policy
controlled the integration process.
The Pilots Union did not have a written Teamsters Merger Policy, but they followed
standard protocols when they assembled the Flight Options-Flexjets seniority list. Captain
Dubinsky, a retired pilot with considerable pilot integration experience, oversaw the integrated
seniority list process. With extensive experience, including having led a number of United

27

Section 3 and 13 of the Allegheny-Mohawk Labor Protective Provisions were incorporated into the McCaskillBond Amendment to the Federal Aviation Act, 40 U.S.C. §42112, Note § 117(a).

9

Case No.16-CV-732
Gwin, J.
Airlines seniority list integrations, Dubinsky testified the seniority integration process followed
standard Airline Pilots Association (ALPA) Merger Policy.28 Dubinsky further testified that the
integration process emulated the ALPA process to make sure the integration process was “fair
and equitable.”
The Flight Options – Flexjet pilot circumstances give support that the seniority merger
process was fair and reasonable. Recall, both pilot groups were represented by the Pilots Union.
And both pilot groups were roughly the same size. While any pilot seniority integration formula
would advantage some pilots while disadvantaging others, the formula did not systemically
benefit any subgroup of pilots. Somewhat counterintuitively, the incoming Flexjet pilots
generally received higher seniority rankings than the Flight Option pilots.
The Carriers say that Allegheny-Mohawk Sections 3 and 13 control because the pilots of
the acquired airline were not represented by the Pilots Union at the time of the acquisition. Even
if this Court were to give credence to Counter-Defendants’ argument, the integrated seniority list
process was fair and equitable and thus met the Allegheny-Mohawk Sections 3 standard.29
Section 3 of the Allegheny-Mohawk standard states,

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
28

Doc. 31 at 103.

10

Case No.16-CV-732
Gwin, J.
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 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.

Although the Pilots Union is the certified pilot representative, the Carriers say that they
have an obligation to ensure that the integrated seniority list process is fair and equitable.
Against the backdrop of adversarial national labor policy, the Carriers do not show case or
statutory authority that the Carriers owed a representational duty to the pilots. The Pilots Union
owed fair representation to the pilots it represents. The Carriers do not.
Pilots can enforce the fair representation duty and can sue the union for breach of this
duty of fair representation. But it is nowhere clear that the Carriers have any duty or standing to
challenge the Pilots Union’s pilot representation.
The Pilots Union gave the integrated seniority list (“ISL”) to the Carriers. At the time the
list was given to the Carriers, the Pilots Union represented both Flexjet and Flight Options pilots.

11

Case No.16-CV-732
Gwin, J.
The Pilots Union ISL methodology was based on pilots’ “modified longevity date.” Two
equal-size merger committees—Flexjets Pilots Merger Committee and Flight Options Pilots
Merger Committee—worked together to devise the methodology.
Pilots had longevity dates going as far back as 1995, with over 370 of the 670 pilots
having a longevity date dating to the year 2000 or before. Under the consolidated seniority list,
all Flexjet pilots kept their relative seniority to other Flexjet pilots. All Flight Options pilots kept
their relative seniority to other Flight Option pilots.30
The integration committees decided that because “Flexjet is the older company when
compared to all combined companies . . . a Flexjet pilot would be integrated above an adjacent
Flight Options pilot having a later Longevity Date, notwithstanding the Longevity Date of
subsequent Flight Options pilots may be earlier.” Captain Adam Fine, a Flexjet pilot who served
on the merger committee testified that the longevity method was selected over the date-of-hire
method because the “date-of-hire method would put half the entire Flexjet pilot group at the
extreme bottom of the seniority list.”31 This methodology resulted in the first thirty-three pilots
on the seniority list all being Flexjet pilots.32 Captain Fine also testified that the 80 transfer pilots
were allowed to choose whether they wanted to be integrated based on their position at Flexjet or
their position at Flight Options.33
On February 24, 2016, the two committees sent a detailed letter to all pilots that
explained the committees’ seniority integration decision. In the letter, the committees explained
the various factors the committees considered in deciding on the modified longevity
methodology. Among other factors, the Committee said its integration formula considered:
different aged companies, previous merged seniority list at Flight Options resulting in scrambled
30

Doc. 31 at 133.
Doc. 31 at 131.
32
See Doc. 19-1.
33
Doc. 31 at 136.
31

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Case No.16-CV-732
Gwin, J.
Date of Hire, different sized companies, furloughs, personal leaves of absence, large disparities
in hiring bubbles at both companies during different years, different Captain/First Officer ratios
at each company, inaccurate or incomplete employment data, and pilots hired on the same date at
each company. The Committees addressed each of these factors and then explained the various
methods it considered and why it ultimately chose the one it did.34
This Court finds it difficult to argue that the Carriers have any standing to challenge the
integration committee’s decision. Moreover, the union representation background does not
suggest why the Pilots Union would, or has, favored any subgroup of union members. The
process was sanctioned by representative employees of both Flexjet and Flight Options. And
even accepting the Carriers’ curious resistance to the integrated seniority list, the CBA provides
a clear mandate that the “Company or other Successor, as appropriate, shall accept the integrated
seniority list.”35
Counter-Defendants Carriers seem to misunderstand their primary duty in relation to the
ISL—it is not a duty to ensure the process is fair and reasonable, but rather a duty to accept the
ISL list presented. Counter-Plaintiffs Pilots Union, as the representatives of both Flexjet and
Flight Options pilots, hold the duty to ensure a fair and equitable ISL process for the pilots they
represent.
The Carriers’ own Chairman made a statement on October 15, 2014, that acknowledged
that it was the union’s job to integrate the seniority lists. The Chairman said, “once the union
were to request a single system and thereby start to a merging of seniority lists

. . . then the

union’s first job will be to integrate the seniority lists. That’s—that’s what they do.”36

34

Doc. 19-2.
Doc. 8-2.
36
Doc. 31 at 40.
35

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Case No.16-CV-732
Gwin, J.
This Court finds that the integrated seniority list was fair and equitable and ORDERS the
Counter-Defendants Carriers to accept the ISL.
Voluntary Separation Program
Applying the Sixth Circuit’s Wheeling guidance, the voluntary separation package
(“VSP”) is a major dispute because it relates to “acquisition of rights for the future.” The dispute
is also a major one because the Carriers’ claim that it had the right to present the VSP to pilots
without bargaining is a “claim that is “frivolous or obviously insubstantial in light of the express
language” of the collective bargaining agreement, as demonstrated below.
When parties are engaged in a major dispute under the Railway Labor Act, they must
maintain the status quo until they exhaust the major dispute process.37 Influenced by a goal to
avoid disruption of the transportation system, the Railway Labor Act sets forth a detailed
sequence of steps that carriers and their employees’ representatives must follow in negotiating
CBAs. The Seventh Circuit has summarized that sequence of steps as follows:
First, the party seeking a change in rates of pay, rules or working
conditions must give notice and confer with the other party. If the
parties remain unable to resolve their dispute after this conference,
either or both of them may seek mediation by the National
Mediation Board. If the mediation fails to produce agreement, the
National Mediation Board must attempt to persuade the parties to
submit to binding arbitration. If either or both of the parties rejects
the offer of arbitration and the dispute threatens ‘substantially to
interrupt interstate commerce to a degree such as to deprive any
section of the country or substantial transportation service,’ the
NMB must contact the President who may then create an
emergency board to ‘investigate and report respecting such
dispute.’ If the NMB releases the parties from mediation before an
agreement has been reached, the RLA imposes a 30-day “coolingoff” period upon the parties. Throughout this entire lengthy
negotiation process, carriers and unions are required to maintain

37

See Consol. Rail Corp., 491 U.S. at 302–03 ; United Transp. Union v. Cuyahoga Valley Ry. Co., 979 F.2d 431,
435 (6th Cir.1992). In Detroit & Toledo Shore Line Railroad Co. v. United Transportation Union, 396 U.S. 142,
143 (1969).

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Case No.16-CV-732
Gwin, J.
the status quo with respect to rates of pay, rules, and working
conditions.38
If either side unilaterally alters the status quo:
A court may issue an injunction to put a stop to that party’s illegal
self-help and to restore the status-quo, and it may do so even
without the traditional showing of irreparable injury to either
party.39
Offering voluntary separation packages to Flight Options pilots without any meaningful
bargaining with Pilots Union violates the status quo.
The Carriers have a collective bargaining agreement with the Pilots Union. After the
representation election and the resulting certification, the Pilots Union represents both Flight
Options pilots and Flexjet pilots.
The Flight Options – Pilots Union collective bargaining agreement requires negotiations
to resolve issues coming from the merger or acquisition. The same provision requires interest
arbitration if the parties are unable to resolve issues coming from the Flexjet acquisition:
The Flight Option Collective Bargaining Agreement says:
1.5(c)(4) If Pilots of the acquired carrier are hired by the Company, the
Agreement shall be modified in those respects necessary to permit the
integration through negotiations between the surviving air carrier and the
representative of the consolidated, post-merger Pilot craft or class. If a
modified agreement is not executed within nine months from the date a
final and binding integrated Pilot Seniority List is issued, the parties shall
submit outstanding issues to binding interest arbitration. 40
Further, the collective bargaining agreement requires that seniority govern any
“reduction in force”

United Air Lines, Inc. v. Int’l Ass’n of Machinist & Aerospace Workers, AFL-CIO, 243 F.3d 349, 361 (7th Cir.
2001).
39
Id.; see also, Wheeling & Lake Erie Ry. Co. v. Bhd. of Locomotive Engineers & Trainmen, 789 F.3d 681, 691 (6th
Cir. 2015).
40
Doc. 8-2, Page ID 90.
38

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Case No.16-CV-732
Gwin, J.
5.1 Application of Seniority
Except as may be provided otherwise in this Agreement, seniority
shall govern all pilots in cases of promotion and demotion,
retention in case of reduction in force, recall after furlough, choice
of vacancies, choice of vacation and schedule bidding, and such
other purposes as may be provided in this Agreement.
Thus, the voluntary separation package seems to run counter to the collective bargaining
agreement. The Carriers state in their briefing, “because Flight Options pilots faced possible
furlough due to overstaffing Flight Options decided to offer a very generous voluntary separation
program (“VSP”) to see if enough pilots will take the offer to avoid a potential furlough.”41 The
voluntary separation program seems aimed at reducing the workforce.
Independent of how any separation program plays out, the Carriers were required to
meet, confer and negotiate with the pilot certified representative before offering the separation
proposal.
As the Supreme Court has explained, the RLA,
does not undertake to compel agreement between the employer and
employees, but it does command those preliminary steps without
which no agreement can be reached. It at least requires the
employer to meet and confer with the authorized representative of
its employees, to listen to their complaints, to make reasonable
effort to compose differences—in short, to enter into a negotiation
for the settlement of labor disputes . . .42
The Supreme Court has further explained that the RLA’s duty to bargain in good faith is
similar to the National Labor Relations Act duty to bargain in good faith and that “the duty of
management to bargain in good faith is essentially a corollary of its duty to recognize the
union.”43,44

41

Doc. 13-1 at 18.
Virginian Ry. Co. v. Sys. Fed'n No. 40, 300 U.S. 515, 548 (1937).
43
Chicago & N. W. Ry. Co. v. United Transp. Union, 402 U.S. 570, 575 (1971).
44
The Carriers argue that the Eighth Circuit’s reasoning in Int’l Ass’n of Machinists & Aerospace Workers, Dist.
Lodge No. 19 v. Soo Line R. Co., 850 F.2d 368 (8th Cir. 1988) should apply here. There, the Eighth Circuit, in a
42

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Case No.16-CV-732
Gwin, J.
Counter-Defendants Carriers must rescind the VSP offers made and bargain in good faith
with Pilots Union.
Conclusion
For the reasons above, this Court GRANTS the motion for preliminary injunction and
ORDERS the Counter-Defendants Carriers to accept the integrated seniority list, rescind the
voluntary separation package and bargain in good faith with Counter-Plaintiffs Pilots Union.
IT IS SO ORDERED.

Dated: May 25, 2016

s/
James S. Gwin
JAMES S. GWIN
UNITED STATES DISTRICT JUDGE

divided opinion, decided that the implementation of a voluntary separation package despite a collective bargaining
agreement was a “minor dispute.” However, this Court is not bound by that decision and finds that the case at hand
is more similar to Bhd. of Ry., Airline & S.S. Clerks, Freight Handlers, Exp. & Station Employees v. Chesapeake &
Ohio Ry. Co., No. C 83-451, 1983 WL 1754, at *7 (N.D. Ohio Oct. 19, 1983), which found that the implementation
of a voluntary separation package did constitute a major dispute.

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