The U.S. airline industry operates over 11 million flights per year and carries more than one-third of the world’s total air traffic. It’s an industry that drives economic activity and supports over 10 million jobs across the United States. But today, those jobs are in jeopardy because of a growing trend that threatens to kick off a global race to the bottom in airline standards.
This trend involves so-called flag-of-convenience schemes, which allow operators of transportation companies to determine the location of their headquarters based on a country’s regulatory climate. Some airlines are doing just that to “operate” in countries with relaxed regulatory structures, allowing them to pay workers lower wages and forgo long-held safety standards. These schemes also allow airlines to outsource cheap labor for their operations. That means pilots and flight attendants can be hired from a variety of countries around the world where traditional labor and safety standards do not apply.
By allowing airline operators to take advantage of these schemes, we are ceding our government’s oversight role over the safety and security of 900 million air travelers per year, and jeopardizing good-paying American jobs. If this approach expands domestically, it will result in fewer jobs at lower wages, less experienced pilots and lower safety standards – the last thing we need at a time when we’ve seen just how valuable pilot experience truly is.
Unfortunately, the practice is on the rise. Take, for example, Norwegian Air International (NAI). Norwegian is “headquartered” in Ireland in order to take advantage of Ireland’s less-restrictive labor and regulatory laws. By doing so, NAI is able to use flight crews employed under contracts governed by the laws of various countries, including those as far away from Ireland (or Norway) as Singapore and Thailand. This is just the beginning of what could ultimately be dozens of flag-of-convenience operations in the international airline marketplace. Airlines such as SAS and Air France are already reportedly looking to replicate NAI’s business model.
We’ve seen before how flag-of-convenience schemes can decimate a U.S. industry. In 1955, U.S. maritime vessels carried 25 percent of the world’s tonnage. However, ship owners eventually began to register and “flag” their vessels in countries that offered the least-restrictive laws governing their crews, taxes and other aspects of their business. Wages plummeted and working conditions deteriorated as the U.S. maritime shipping industry all but collapsed. Today, the U.S. shipping industry accounts for just 2 percent of world tonnage. We can’t let the same thing happen to our airline industry, which directly employs nearly 700,000 people across the United States.
Thankfully, members of Congress have taken a stand by passing the FAA Reauthorization Act of 2018, which includes H.R. 2150, the Flags of Convenience Don’t Fly Here Act. This act would prohibit the Department of Transportation (DOT) from issuing foreign air carrier permits to an airline unless DOT determines that the airline is not establishing itself in a particular country just to avoid regulations. Under this legislation, pilots would be more experienced and better compensated. More broadly, it would prevent the loss of U.S. aviation jobs and protect the safety of the flying public.
While nearly 400 members of Congress from both parties backed legislation with this provision included, the work to protect our airline industry isn’t over. We now need the U.S. Senate to join the House and prevent this rising threat to the airline industry. The Senate’s final version of the FAA Reauthorization Act must include H.R. 2150, and the final FAA reauthorization bill must include it as well. The thousands of hard-working men and women who keep our nation’s airlines flying depend on it.
Captain Dan Carey is president of the Allied Pilots Association, the largest independent pilots union in the United States representing the 15,000 pilots of American Airlines, the world’s largest passenger airline.
The views and opinions expressed in this commentary are those of the author and do not reflect the official position of The Daily Caller.
