The full U.S. House of Representatives could vote on a bill to bar what it calls “flags of convenience” airlines from seeking to fly to the U.S., after the House Transportation & Infrastructure Committee approved the measure late last week. The bill is a shot across Norse Atlantic Airways’ bow as that airline seeks to begin low-cost flights to the U.S. later this year.
The Fair and Open Skies Act, introduced in May by a Transportation Committee Chairman Rep. Peter DeFazio (D-Ore.) and cosponsored by a bipartisan clutch of 10 representatives from states as diverse as Pennsylvania, Hawaii, Georgia, and Nebraska, is expected to come up for a vote in the full House when the chamber returns from its August recess, or by late September. Sources close to the matter say DeFazio is working to get more sponsors for the bill before it comes up for a floor vote.
The bill would prohibit airlines that flout international and U.S. labor laws from flying to the country by directing the Transportation Department (DOT) to withhold a foreign air carrier permit from airlines that are in violation of protections. Specifically, the Fair and Open Skies Act invokes the provision in the U.S.-EU open skies agreement that requires airlines on both sides of the Atlantic to adhere to the labor laws of their home countries and the U.S. bill, if enacted, would apply only to airlines applying to fly to the U.S. and would not be retroactive.
The House bill has no counterpart in the Senate, although advocates are encouraging senators to attach the bill’s language to the Senate Appropriations bill.
Memories are long in Congress. Backed by unions, DeFazio led the fight in 2015 to ban Norwegian Air from operating to the U.S., alleging the carrier violated the very provision invoked in the Fair and Open Skies Act by sourcing crews from Asia and elsewhere besides Norway, where labor laws are stronger. Earlier this year, he urged Transportation Secretary Pete Buttigieg “correct the error” of Norwegian’s permit by denying Norse Atlantic’s application for a foreign air carrier permit.
“As Americans start to travel again after the Covid-19 pandemic, it’s more important than ever to make sure that any foreign airlines looking to serve U.S. markets play by the rules and don’t exploit the weaker labor laws of other countries to save money and unfairly get a leg up,” DeFazio said before the House adjourned for its August recess.
The years-long dustup ended when the DOT eventually granted Norwegian Air a foreign air carrier permit, after it proved that it was not in violation of the open skies agreement. Even though the conflict ended, the scars remained, but the issue became moot last year when Norwegian gave up its longhaul ambitions to focus on shorthaul European flights.
Enter Norse Atlantic Airways, a startup that aims to take the mantle from Norwegian Air to offer low-cost longhaul transatlantic flights. The carrier, run by many former Norwegian Air executives, is in the process of securing an air operators certificate and will apply for a foreign air carrier permit from the DOT in advance of planned launch later this year. CEO Bjørn Tore Larsen stressed to Airline Weekly that the carrier is a completely new entity and said comparisons to Norwegian Air are unfair. To ally labor’s concerns, Norse Atlantic began a charm offensive in the spring to win over some of the unions, striking an agreement with the Association of Flight Attendants (AFA) to pledge that it would allow workers to organize. At the time, AFA President Sara Nelson called Norse Atlantic’s approach “refreshing.” Pilots unions, though, remained skeptical.
And they still are. “ALPA pilots have been calling on the U.S. Government to put a stop to any foreign airline business scheme that undermines labor rights, safety, and the competitiveness of our nation’s airline industry,” Air Line Pilots Association President Joe DePete said. “By upholding a foundation of workers’ rights in U.S. international aviation policy and imposing labor protective conditions before permitting a foreign airline to serve the United States, the DOT can protect fair wages and working conditions for American workers while enhancing safety for the flying public.”
“Flags-of-convenience schemes have no place in U.S. commercial aviation, and preventing them from gaining a foothold has long been one of APA’s top priorities,” Allied Pilots Association President Eric Ferguson said, urging the Senate to attach the House bill to its appropriations bill.
Now, as back in the last decade, the unions say skirting labor laws in a “race to the bottom” for the least expensive workers compromises aviation safety. They point to the maritime industry, which deregulated in the mid-20th century, resulting in shipping lines “forum shopping” for the most lenient regulatory regime and labor laws. A similar dynamic in aviation could bankrupt U.S. carriers, result in industry-wide job losses, and make the system less safe, they allege.
The International Brotherhood of Teamsters made this point explicit. “The U.S. House of Representatives is stopping the exploitation of a regulatory loophole that threatens the livelihood of workers and safety of passengers throughout the airline industry,” Teamsters Airline Division President David Bourne said.
For its part, Norse Atlantic is not sitting still. The carrier still is pressing ahead with its planned transatlantic launch later this year. This week, the carrier announced an order for an additional six Boeing 787s from lessor BOC Aviation, bringing its total fleet to 15 of the type.