January 29, 2019

January 2019 Update (#2)

Dear Atlas & Southern Air Crew Members,

I am writing to provide you a general update on the Atlas and Southern integration.

The integration process has continued to move forward as anticipated. Even through the government shutdown, we continued to make progress. We look forward to completing the final steps, including implementing the Single Operating Certificate (“SOC”) once related labor issues are resolved.

Over the past several weeks, we have also worked with the Union to enter into another Framework Agreement to return to the table as soon as practical. We are down to just a few open items for this Framework Agreement and I am optimistic those will be resolved shortly. Bill Flynn, Jeff Carlson and I are also set to meet with your Union leadership on February 4th to share ideas and further discuss the path forward. It remains our goal to reach a Joint Collective Bargaining Agreement (JCBA) that considers the current industry environment and recognizes all of your significant contributions.

While the Company has been working very hard to move this process forward, we recently received a request from the Union to delay the filing dates for the post-hearing briefs due in the management grievance arbitrations, which were originally set for January 31st for Atlas, and February 8th for Southern. As we all have already waited an extraordinary period of time to complete these grievances, the Company opposed the extension request. We did not want to delay the outcome any further.

The arbitrator in the Atlas case, however, granted the Union’s extension request. Based on this ruling and the circumstances cited by the Union for its extension request, we withdrew our opposition to the extension in the Southern case. This unfortunately will further delay the timeline to get to a decision. The briefs for Atlas and Southern are now delayed by three weeks, and are due at the end of February and beginning of March, respectively.

Notwithstanding this delay, we remain committed and we are pressing to get the parties back to the bargaining table and continue negotiations for a JCBA promptly.

Operationally, we have had a very busy January, which is normally a time where there is some relief in the schedule. Nevertheless, the Chinese New Year holiday is quickly approaching with the resulting pull down in flying. Pilot training is on track as planned and we continue to hire pilots for all four fleets. Also, we continue to focus on improving the quality of life for our crew, including adding Duty Pilots to all shifts, increasing the number of Flight Watch coordinators, enhancing Bid Line Award reliability and improving hotel management. We know these areas are important to you and appreciate the feedback that you have shared.

We remain committed to bringing you additional updates as further developments arise. We appreciate your dedicated service to our Customers and to the Atlas Air team.

John Dietrich
President & Chief Operating Officer