What's your number? Interpreting the “fair and equitable” standard in seniority integration for airlines and other industries

Darin Lee and Ethan Singer

Economics of Transportation, 2014, vol. 3, issue 1, 2-15

Abstract: This paper develops an analytical framework for assessing the effects of workforce seniority integration resulting from a merger or consolidation of two firms, with a focus on the airline industry. In addition to developing the first formal model that can be used to analyze the relative equity effects of integrating two workforces following a merger, we demonstrate why the interpretations of the “fair and equitable” standard embedded in the two most commonly proposed methods of seniority integration used in the airline industry (the so-called “date-of-hire” and “ratio” methods) are in conflict, thereby necessitating binding third party arbitration. We also demonstrate that measures of aggregate equity distortion can often be reduced using a hybrid method that combines elements of both the date-of-hire and ratio methods.

Keywords: Airlines; Seniority; Mergers; Furloughs; Workforce integration; Unions (search for similar items in EconPapers)
Date: 2014
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Citations: View citations in EconPapers (1)

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Persistent link: https://EconPapers.repec.org/RePEc:eee:ecotra:v:3:y:2014:i:1:p:2-15

DOI: 10.1016/j.ecotra.2013.12.002

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