SAN DIEGO — There appear to be few professional similarities between John Fanning, a Washington labor lawyer, and Sol Price, the founder of San Diego-based Price Cos.
The first has been appointed to the National Labor Relations Board by five U.S. presidents, and the latter is known for his innovative retailing, having founded both the now-defunct FedMart and the Price Club chains.
Nonetheless, both men were at the same table in Pacific Southwest Airlines' Lindbergh Field offices Monday morning for the first-ever meeting of the airline's board of directors.
Fanning and Price, along with San Francisco attorney Jack Curtis and Minnesota Mining and Manufacturing Chairman Lewis Lehr, were nominated to the airline board by PSA employees. The newly formed board will oversee airline matters, while the PSA Inc. board will deal with the corporation's growing non-airline businesses.
Oddly enough, neither Price, who relies primarily on a newly purchased Price Cos. airplane for business trips, nor Fanning, who logs thousands of miles on commercial airliners each year, pretends to be expert in airline industry affairs.
Selected by Employees
But Price and Fanning, along with Curtis and Lehr, were selected by PSA employees to help guide the airline as it expands its fleet, payroll and flight schedule in the turbulent and competitive West Coast market. Employees won the right to choose their directors last year in exchange for absorbing a 15% pay cut and promising to boost productivity by 15%.
As part of that agreement, employees will share in 15% of PSA's (the airline, not the corporation) future pretax profits, to be distributed half in cash and half in stock. In addition, employees will eventually receive 15% of the airline's common stock.
Fanning and Price were selected by PSA's 3,500 Teamster-represented employees. The Air Line Pilots Assn. selected Curtis, who helped craft the wage-for-ownership agreement last year, and non-represented employees selected Lehr.
Although PSA's board accepted the directors suggested by employees, the four aren't really employee "representatives," a distinction that both Price and Fanning stressed.
"I don't work for Teamsters," Fanning maintained. "I work for every stockholder in the company. I'll do the best and most honest job that I can do, to the best of my abilities . . . but I don't take any orders or instructions, and if it comes to that, I'll say, 'Thank you, goodby, it's been fun.' "
Price said he is "not going to be a specific representative (for anyone). I'm going to be a director . . . (not) someone who just goes to meetings and says 'yes' and 'no' on a knee-jerk reaction basis. . . . If I'm not a positive influence, I will leave."
Fanning, Price, Curtis and Lehr have each told employees that they sometimes won't be able to discuss what goes on behind the board room's closed doors.
Curtis has warned the pilots who selected him that, "when it comes to sensitive information, he won't be able to talk to us about it," said Pete Pettigrew, master executive council chairman for PSA's Air Line Pilots Assn.
"That's fine with us," Pettigrew said. "It's his right to vote his conscience (on board decisions). What we wanted is access to the board, someone we can talk to, and we're really happy with what we've got."
"Everyone's looking forward to seeing how the 'grand experiment' works out," said Gil Oakes, a Teamster business agent who works with PSA's flight attendants and agents.
That "experiment" with employee stock ownership and employee input into the board selection process is already changing the way the airline does business, according to Pettigrew and Bonnie Johnson, an accounting department manager.
"There's more interest in the company and people try harder," surmised Johnson, a 25-year PSA employee who was on a non-union employee committee that selected 3M Chairman Lehr. "They're less apt to throw out something and more apt to say, 'Let's not spend that money, let's try to get by on something else.' "
Pettigrew offers a more pointed example: ALPA grievances decreased after the wage and ownership agreement was introduced.
Although grievances by PSA's Teamster-represented flight attendants have also declined, grievances lodged by mechanics and reservationists have risen, according to Marv Griswold, principal officer of Teamsters Airline Local 2707, which represents employees of airlines in 13 Western states. Griswold linked the upswing in reservationists' grievances to uncertainty about how a planned reservations office slated to open in Reno will affect jobs in San Diego.
"Although we're not happy with the pay give-backs . . . we see stock ownership as a positive thing," Griswold said. "It provides employees the incentive to really get involved with their company, and participation at the board level can be good, providing that the company truly is interested in hearing from its employees."