Here's a piece that a reader pointed out and I'm just getting around to posting on it. Many of you probably heard of the controversy that erupted when Northwest Airlines (which is in bankruptcy) issued a booklet to its employees on how to save money in their personal lives. Seems like the hints were a bit undignified (or at least some employees felt that way) and caused resentment among Northwest workers (who have already taken as much as a 40% paycut to try and keep the airline afloat.)
Some of the ideas they suggested:
- Don't be shy about pulling something you like out of the trash.
- Take in boarders.
- Air-dry clothes.
- Ask for hand-me-downs from family and friends.
- Change your car's oil yourself.
- Use old newspapers for cat litter.
- Donate time instead of money to religious groups or charities.
Actually, these aren't bad suggestions -- and I've offered many of them up myself (and use many of them myself by the way.) But the problem is that the ideas come at an especially difficult time for Northwest employees -- that's why they didn't go over that well (in addition to the fact that they could be viewed as demeaning ideas -- though I don't see them that way). Here's a bit of a summary of the situation that made things so explosive:
On July 31, their [Northwest's unionized workers] annual pay dropped to a range of $16,000 for starting workers to $43,000 for the most senior, when a bankruptcy judge ordered them to accept the airline's contract terms. Camilla Wolkerstorfer, interim president of the Northwest Council of the Association of Flight Attendants, calls the memo "insulting and outrageous." She says flight attendants are so squeezed that some are taking second jobs and working seven days a week to pay their bills. "I just don't get that mentality," she says of the airline's management.
The trash-picking tempest comes at a particularly sensitive time for the money-losing airline and its flight attendants. Northwest, which filed Chapter 11 last October, has forced employees to swallow deep pay cuts and mass layoffs to chop $1.4 billion from its annual personnel budget. But while other unionized groups begrudgingly agreed to giveback contracts, the flight attendants twice rejected the company's new deal.
I'm not going to step into this fray, but I am going to add a few comments:
1. I hope Northwest makes it. I live in Michigan, and they fly a ton of flights out of and into the state. If they collapse and no one takes over their routes, our state will be in a world of hurt airline-wise.
2. All Northwest workers -- the union workers as well as executives -- should probably start looking at ways to cut their personal expenses. It only seems prudent at this point. Some additional suggestions for saving money can be found in the Free Money Finance saving money category.
3. It's tough to take such a pay hit -- very tough. But for now, all Northwest employees should be thankful they even have jobs. The company is on the verge of dying, so at least some salary is better than nothing. Unfortunately, most other airlines are not in that much better shape, so employment opportunities are limited in the industry. Northwest employees should start thinking about how their skills translate to other industries and begin working on a plan to get a new job in those industries.
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