Aviation groups sue Obama admin over Norwegian Air decision

Aviation groups are suing the Obama administration over its controversial decision to approve Norwegian Air’s bid to fly to the U.S., arguing that the move is a threat to American jobs.

In a lawsuit filed in the Court of Appeals for the District of Columbia Circuit on Thursday, unions representing pilots and flight attendants asked that the decision be overturned based on the grounds that it violates labor protections contained in the international Open Skies agreements.

“The Administration’s decision to allow Norwegian Air International to operate in the U.S. is disappointing and undercuts key protections in place for working men and women,” said AFL-CIO President Richard Trumka. “The labor movement is united and ready to fight to overturn the decision.”

{mosads}The lawsuit was filed by the AFL-CIO, the Air Line Pilots Association International, the Association of Flight Attendants-CWA, the Allied Pilots Association and the Transportation Trades Department.

Norwegian Air has for years been seeking access to more airports in the U.S. and European Union by establishing a subsidiary — Norwegian Air International — in Ireland, a member of the EU.  The company says it could offer transatlantic flights for as low as $150 each way under that model.

The Department of Transportation (DOT) issued final approval for the permit last month, which roiled the aviation industry. The agency said it consulted with the Justice Department and legal experts over the complex matter.

The DOT concluded that in approving applications, it does not have to consider a clause in the U.S. and E.U.’s Open Skies agreement that says “opportunities created by the Agreement are not intended to undermine labour standards or the labour-related rights.”

The department argued that the provision of the agreement that addresses labor “does not afford a basis for rejecting an applicant that is otherwise qualified to receive a permit.”

“Norwegian remains confident that the DC Circuit will uphold DOT’s decision as fully consistent with DOT’s statutory obligations and international legal requirements,” said Anders Lindström, Norwegian’s spokesman. “We view [the petition] as nothing more than a last-ditch effort to stop competition and new service.”

Critics say the company is attempting to skirt more stringent Norwegian labor and tax laws by establishing itself in Ireland. Opponents also slammed the airline for undermining competition by hiring pilots contracted through Asia, where labor costs are lower.

“The DOT’s wrongheaded decision on NAI’s permit application rewards a rogue airline for bad behavior,” said Edward Wytkind, president of the Transportation Trades Department. “When our government permits foreign airlines to game our trade rules and refuses to enforce worker protections it negotiates into trade agreements, not only are good jobs and a vital industry at risk, but the public interest is in harm’s way.”

Norwegian Air currently flies to some airports in the U.S. under the banner of its parent company, Norwegian Air Shuttle. But the company says the model for its low-cost subsidiary requires access to more Open Skies airports in order to have more route flexibility.

Norwegian Air maintains that it established its subsidiary in Ireland for access to future traffic rights to and from the EU and to secure better aircraft financing rates, and has agreed not to use any Asian-based cabin crew on transatlantic flights.

“Norwegian is excited about its plans to launch more affordable flights between the United States and Europe,” Lindström said.