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2008 Agenda #9 SUBJECT: Reimbursement of Expenses for Previous Fiscal Years STATEMENT OF QUESTION: Should the AFA-CWA Board of Directors direct the International Secretary-Treasurer to credit the specific accounts where the funds originated when expenses are reimbursed to the Union in a different fiscal year then when they occurred? SOURCE AND DATE SUBMITTED: UAL MEC - May 9, 2008 BACKGROUND INFORMATION: Over the years, some member carriers have been able to negotiate with their respective airline to receive reimbursement for various activities. These reimbursements have typically involved expenses associated to events or actions that the carrier’s management believed to be of mutual interest, such as, for example, negotiations outside Section 6, or joint training for a new dispute resolution process. Local Councils and MECs disbursed funds with the clear understanding that their budgets would be credited with those amounts when the airline reimbursed the expenses. They would defer unrelated purchases or expenditures until they obtained the reimbursements. The amounts may vary for a few hundred to a few thousand dollars for a Local Council, to tens of thousands for an MEC. Because of administrative issues, it is not unusual that expenditure and reimbursement do not occur during the same fiscal year. It had been practice up until 2006, for the budget where the expense originated to be credited when the reimbursement was received regardless. In 2007, the International Secretary-Treasurer unilaterally decided that funds reimbursed for a different fiscal year under these negotiated agreements would not be credited to the originating budgets but to a “Miscellaneous” line item. This procedure forces Local Councils and Master Executive Councils to forego expenditures and member related services they had planned to defer, not eliminate. PROPOSED RESOLUTION: WHEREAS in the past, individual member carriers have negotiated reimbursements with their respective carriers for issues of mutual interest, and WHEREAS in 2007, the International Secretary-Treasurer decided that the budgets where the funds originated would not be credited if the reimbursement occurred in a subsequent fiscal years, and WHEREAS this unilateral change will force the affected Local Councils and Master Executive Councils to forego expenditures and purchases they had deferred in anticipation of the reimbursements, and WHEREAS this policy will discourage member carriers from negotiating these reimbursements that amount to hundreds of thousands of dollars for the Union, and THEREFORE BE IT RESOLVED that the AFA-CWA Board of Directors directs the International-Secretary to credit the originating budgets for those negotiated reimbursements even if they are received in a subsequent fiscal year, BE IT FURTHER RESOLVED that the BOD directs of the International Secretary-Treasurer to credit the 2008-2009 budgets for those reimbursements received in 2007 but not directed to the originating Councils, and BE IT FINALLY RESOLVED that for accounting procedural consistency, just as the carry over funds contemplated in Section IV.C.1 of the Policy Manual of the AFA-CWA Constitution and Bylaws or contractually provided Flight Pay Loss do not appear in the proposed budget, but only as they are applied, these reimbursements will be posted only when effectively received. |
