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Mon, Nov 17, 2003

Pilots Unhappy In Negotiations With Berkshire Hathaway Subsidiary

Talks Are "Contentious And Unsatisfactory "

The airline that sold wealthy travelers on the concept of fractional ownership of luxury business jets has been unsuccessful in convincing its pilots to accept proposals for a new collective bargaining agreement.

The National Mediation Board has appointed a mediator to participate in negotiations between NetJets, Inc. and the International Brotherhood of Teamsters, Airline Division, Local 284. NetJets, Inc. is the largest fractional airline in the nation, serving an elite customer base that owns shares in small to heavy luxury business jets.

The Teamsters represent pilots, flight attendants, maintenance technicians and service personnel employed by Columbus, Ohio based NetJets Aviation, Inc. The mediator was appointed at the request of the union. The contract under negotiation covers approximately 1,900 pilots.

NetJets management and the pilot’s union have been in negotiations for over two years. The current collective bargaining agreement became amendable on October 1, 2001. In 1998, billionaire investor Warren Buffett’s Berkshire Hathaway, Inc. purchased NetJets, Inc. The company’s website describes it as "the financially strongest aviation company in the world."

Dave Vermeulen, a NetJets pilot who serves as the chairman of the pilots’ Master Executive Council and a business representative for the Teamsters, describes negotiations as "contentious and largely unsatisfactory from a pilot standpoint." Pilot schedules, geographical basing requirements, the length of duty and rest periods, and the ability of the company to perform flights with non-union pilots are at the core of the dispute.

The Teamsters accuse management of making regressive proposals despite the company’s continuing dominance of the fractional airline industry. "Management totally out of touch if they believe pilots are willing to go backwards in any area of their contract,"  Vermeulen said. "Many of their proposals have been dead on arrival."

According to published data, NetJets claims a market share of approximately 72 percent, up from near 54 percent two years ago. An August 2003 study by Aviation Research Group US, Inc. rated NetJets as the industry leader in owner loyalty and customer service.

The union intends to propose significant salary and benefit increases after attempting to resolve disputed working conditions with the assistance of the mediator. "Our negotiators have informed the company that dramatic improvements in working conditions and compensation are expected and will be secured, one way or the other,"  Vermeulen said.

A seven year captain receives a gross salary of $67,560.00 annually. First officer pay is capped at $32,160.00. Approximately thirty pilots assigned to the Boeing Business Jet, a luxury 737 capable of long distance international trips, earn more.

"NetJets’ customers represent an elite segment of the flying public – the very wealthy, athletes and entertainers,"  Vermeulen said. "Many of them would be shocked to learn that the pilots who fly them earn significantly less than commercial and corporate pilots."

Mediator Brad Laslett will be in Columbus, Ohio for negotiations beginning November 11.  Laslett has scheduled additional negotiation sessions throughout the winter.

FMI: www.netjets.com/home.asp

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