Late Thursday, finally, the U.S. Senate passed a 900 plus page pension reform bill. I have very mixed feelings about some of the aspects of this bill — speaking on a grander scale — but clearly the main focus for those in the airline industry was what the bill contained that affected those in the airline industry.

To be more specific, four airlines in particular.

As late as Thursday afternoon, American and Continental were still fighting to get the same 17 year payback period as Northwest and Delta were eligible for under the proposed legislation. But it never happened.

Essentially American and Continental can now stretch out their pension payments out over 10 years, while bankrupt Northwest and Delta get a total of 17 years to do so. However, if either Continental or American wants to freeze their remaining employee pensions — before Dec. 31, 2007 — they too can then qualify for the 17 year time period to play catch-up on the frozen plans.

While Northwest and Delta are clearly the big winners in this one — you can’t really say that American and Continental are hurting. American in particular was looking at at least $1 billion or more in pension payments due in 2007, without the bill having been passed.

But, according to Trebor Banstetter, who wrote Saturday in the Ft. Worth Star-Telegram, Sen. Kay Bailey Hutchinson (R-Tex) says she hopes to amend the bill that was passed last week, after Congress returns from its August hiatus, so that both American and Continental get the same 17-year pay-back time extension.

We’ll see. Makes for a nice sound bite for the Senator who represents two Texas-based airlines, but my suspicion is that if Congress reopens this can of worms, it could be worse than if the can is just left on the shelf. As is.

Grab your gloves and pick your sides.

If you are Continental or American, get over here. If you are Northwest or Delta, you go in that corner over there.

As the Senate continues to fight over the details in a pension bill that Senate Majority Leader Bill Frist, (R-Tenn) has said has to be passed this week before he and his colleagues leave to frolic in the August heat — friction between the four airlines appears to be taking center stage.

As of last week it appeared that changes had been made to the bill that affected the “catch-up” periods for airlines to fund their pension plans. At least the special provisions for the airline industry were still intact, even though the new proposed periods had been reduced.

But this week, when it became clear that the Senate was now leaning towards a deal that would give Delta and Northwest 17 years to fully fund their pensions, while American and Continental, who are NOT in bankruptcy protection, would be given only 10 years to do so — well, you could say that is when the gloves came off.

Not surprisingly, Continental and American think the new proposed regulations are discriminatory. To them.

This latest free-for-all comes just weeks after both Delta and particularly Northwest imported hundreds of airline employees to Washington, in an attempt to arm-twist members of both the House and Senate to retain special exemptions for airlines in bills that were then being hashed out.

It’s Thursday. The clock is ticking.

Meanwhile, cries for caution in pushing through the legislation before Friday continued to mount from many fronts this week. An editorial in Thursday’s Tennessean, for instance, called for the Senate not to rush to judgment.

Considering the bill in front of them is some 900 pages long, the editorial advised, “Senate Majority Leader Bill Frist is pushing for a Senate vote this week. While the House-passed bill includes many necessary elements, it is 900 pages long, and few senators have been able to read the fine print. As desperate as the nation is for pension reform, senators shouldn’t support until they are familiar with all its provisions.”

Okay, if you were surprised by this move, raise your hand.

Just as I thought.

Late Tuesday Northwest Airlines asked U.S. Bankruptcy Judge Allan Gropper to prevent any kind of strike or concerted job action against the airline by the Association of Flight Attendants.

AFA has already notified the airline that it intends to strike, or engage in sporadic targeted strikes against the airline, as soon as 10 p.m EDT., Aug. 15. This move came not too long after Northwest terminated the flight attendants’ current contract Tuesday and imposed new terms that go back to the defeated Mar. 1 tentative agreement between the airline and the PFAA.

We’re into unknown legal waters here folks.

No one is really sure if a strike against the airline would be legal of not. While the Railway Labor Act permits a walkout by airline workers after mediation fails to resolve a dispute — we’ve never actually seen this particular situation in the airline industry before.

AFA contends workers cannot be forced to work under terms they did not agree to. Northwest says it has a right to impose those terms, and that any job action by the flight attendants is forbidden by the Railway Labor Act.

Next Wednesday Judge Gropper will hear arguments from both sides on the airline’s request.

I’d love to be in that courtroom.

From AvWeb this AM:

“A controversial new requirement for landing distance safety margins is drawing fire from the National Air Transportation Association (NATA), which claims the proposal should be shelved. The FAA was spurred to action in the wake of a Dec. 8, 2005, accident at Chicago Midway in which a Southwest Airlines 737-700 skidded off a wet runway and onto a highway beyond, running into a car and killing a 6-year-old boy. In an audit afterwards, the FAA discovered nearly half of the operators they asked had no policies for assessing sufficient landing-distance margins in various conditions. In instances where manufacturer’s data was being used, the feds still had a problem, saying that wet and contaminated landing distances were figured using certification data based on dry and smooth services … so the numbers are not real-world.

Under the new requirement that will take effect on Oct. 1, an operator would not be allowed to land without 15 percent more runway available for the actual landing distance given current weather conditions and use of available equipment such as thrust reversers and spoilers. NATA has a problem that a study of aircraft operated under Part 121 is being applied Parts 125, 135 and 91K as well. “A blanket approach to these varying operations is not acceptable.”

NATA is particularly incensed with the FAA’s definition of time of arrival, calling it a trap that will lead to second-guessing by the feds and possible enforcement action taken against pilots, saying, “If the meteorological conditions change when the aircraft is 500 feet above ground level, must the pilot then mathematically recalculate landing distance at this critical phase of flight?” Though NATA is asking the FAA to use normal rulemaking channels before implementing such a big change, the feds say it is a done deal and that operators should be ready with new procedures by Sept. 1.”

Late Tuesday Ralph Hunter, head of the Allied Pilots Association (APA represents the pilots at American Airlines) issued yet another one of his thoughtful takes on the situation that now exists between the pilots at the airline and management.

His message: shared sacrifice is dead.

No surprise, given recent actions by management at American Airlines — not the least of which was the recent article in the New York Times that we cited here last week. Throw in some salary increases, more stock options for management team members, but more importantly — an attitude from management now that basically says, “Screw you” to its unions (said with a strong sense of entitlement) and well, you get the message.

I’ve always been a fan of Ralph’s measured approach — unlike the usual heated rhetoric and threats we tend to hear from other union leaders. Re: the recent predictable public rantings from both the America West pilot union leadership and US Airways‘ pilot leadership in regard to negotiations between both groups and US Airways — after US Airways posted a nice profit for the second quarter.

Having watched, and well, at one time, having been involved in, the relationship between APA and American closely for more than 13 years — I understand that writing “shared sacrifice is dead,” was extremely hard for Ralph. Ralph and his team have worked tirelessly to try and work with the airline to better the previous negative relationship that had existed at the airline between management and labor.

A lot of other people on both sides here have also invested hours, days, weeks, months and years working to improve the previous situation. A situation that was all confrontational — all the time.

Those who are not familiar with the history here will be quick to say, “Oh, the pilots just want more money now that the airline is making money.” Or, “This is just your typical, ‘Unions don’t think management deserves raises’ problem.”

But this meltdown goes much deeper, as I have discussed in PBB for months. For whatever reason, the management bonus payment issue that went to arbitration earlier this spring became a “personal” issue for CEO Gerard Arpey. If that sounds familiar, it should. It is exactly what happened to his mentor, Robert Crandall.

Someone on the American side, or with the Overland Group, should have stepped in at that point this spring and put the relationship between management and labor back on track. Forced the issue.

But obviously there is no one in the AMR “inner circle” with the balls to do so. In fact, my suspicion is that there was pressure — but it was pushing Arpey in the opposite direction.

This is not a good omen going forward for the airline, as Arpey has now effectively blown any positive credibility he had succeeded in building up with labor over the last three years.

What a waste.

As a result, Ralph had no choice in writing what he did on Tuesday. And that is a damn shame.

A round of the PlaneBusiness kazoo dirge for the death of shared sacrifice.