Airline Workers Underscore Sweeping Opposition To 'Flag-Of-Convenience' Business Model

Scores of Air Line Pilots Association, Int’l (ALPA) pilots converged on Capitol Hill Wednesday to draw attention on the overwhelming opposition across the airline industry and in Congress to Norwegian Air International’s (NAI) foreign air carrier permit application.

“U.S. and legitimate EU airlines play by the rules in the global marketplace—that’s fair competition,” said Capt. Lee Moak (pictured), ALPA’s president. “Conversely, NAI’s model to skirt employment and tax laws is a direct attack on the fair market. The airline pilots streaming across Capitol Hill today are making clear their strong objection to this business model.”

Today’s event, which included ALPA pilots who fly for mainline, cargo, and regional airlines, is the latest action in the union’s work to underscore the threat to fair competition posed by NAI’s model and to catalogue the broad opposition to the company’s permit application. Nearly 35,000 U.S. airline industry supporters have signed ALPA’s petition in opposition to NAI’s application.

On November 15, the union, together with Delta Air Lines, launched the latest advance in its “Deny NAI” advertising campaign, including new radio spots, banner ads on Capitol Hill newspaper websites, and Navy Yard-Ballpark Washington, D.C., Metro station billboards.

In addition, ALPA released a new whiteboard video, which details the facts and figures behind NAI’s unfair business model. The union has also recently kicked off #FinishTheJob, a social media campaign through which airline workers and passengers across the country have urged congressional leaders to join the ranks of 150 of their colleagues who have spoken out against NAI.

On November 12, Capt. Moak sent a letter to the Senate Appropriations Committee urging its members to support legislation already passed in the U.S. House that requires the U.S. Department of Transportation (DOT) to follow the law and the provisions of the EU-U.S. Open Skies agreement when evaluating NAI’s permit request.

“The U.S. maritime industry has seen the adverse effects of flag-of-convenience business practices where companies register merchant ships in a foreign state to avoid their own country’s regulation, taxes, and labor codes,” said Capt. Moak. “The precedent proposed by NAI threatens the U.S. airline industry and our jobs.”

NAI’s flag-of-convenience business model seeks to undercut U.S. airlines by using an air operator certificate from Ireland, a country to which it doesn’t fly. NAI’s business plan would then take advantage of Ireland’s relaxed employment laws to employ outsourced foreign-domiciled workers contracted from a separate employer at wage and benefit levels substantially lower than if it operated as a Norwegian airline headquartered in Norway. In September, the U.S. DOT dismissed NAI’s exemption request but has not yet made a decision on the foreign air carrier permit application to operate to and from the United States.

The EU-U.S. Open Skies agreement was designed to deter European airlines from shopping different countries in which to do business with the goal of obtaining lower labor costs. A specific provision (Article 17 bis) was included in the agreement to prevent business models such as NAI’s that seek to use opportunities under the agreement expressly to lower labor standards.

In addition to conflicting with the EU-U.S. Open Skies agreement, the NAI business model also raises a key safety issue. “We simply don’t know how safety oversight and surveillance of NAI’s flights would be conducted,” said Capt. Moak, explaining that, because the International Civil Aviation Organization has not yet established minimum standards and procedures for oversight and surveillance of a business model such as NAI’s, its plan is uncharted territory as far as ensuring safety.

“Passengers expect, and our industry demands, that airlines abide by U.S. law and policy, employ experienced pilots and crewmembers, and operate under robust government oversight to ensure safety,” said Capt. Moak. “DOT must deny NAI a U.S. foreign air carrier permit.”

FMI: www.alpa.org