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Increasing number of personnel furloughs and layoffs, especially of non-production personnel

Changes in maintenance contracts with air carriers

Increased use of noncertificated agencies

Increasing number of personnel layoffs

Changes in substantial maintenance contracts

Increase in repeat/warrantee work

Increase turnover rate among employees/management personnel

Delays in meeting payroll

Increased frequency of complaints against the repair station

High-risk credit rating in the Safety Performance Analysis System (SPAS)

Labor problems reported in the media that appear to indicate financial distress

Voluntary or involuntary salary cuts

The PI must continually evaluate the operators outsourcing program

The PI must be kept informed of changing situations at any certified repair station through out the world, and the best tools for this data gathering may be found in the SPAS.  SPAS repair station analytical model (RSAM) and repair station profile are designed to keep the PI well informed

B.  Bankruptcy/Potential Bankruptcy.  Financial difficulties may occasionally lead a repair station operator to file for bankruptcy protection.  In these cases, early FAA notification is often not practical.  Therefore, it is essential that substantial maintenance providers (repair stations) intending to operate during bankruptcy proceedings develop, in partnership with

the FAA, an operating plan.  Since judgments and decisions of the bankruptcy court should be taken into account, it may be impractical for the operator to project a completion date for all operational changes.  The operator should continue to operate at all times in accordance with Title 14 of the Code of Federal Regulations (14 CFR).

NOTE: The regulations do not specifically require repair stations to notify the FAA of impending bankruptcies.  However, 14 CFR part 145, § 145.109, requires a repair station to have the equipment, material, and data required by its operations specifications (OpSpecs).  Part 145, § 145.151, provides the minimum requirements for personnel.

C.  Surveillance.  When an air agency experiences a labor dispute, strike, or potential bankruptcy, the CHDO may need to modify the existing surveillance plan to assess the repair station’s ability to conduct safe operations.  The surveillance program should be modified to meet any unique circumstances and operational changes proposed by the operator.  The surveillance program should be based upon risk assessment.  It should focus on high-risk areas (i.e., those with failure consequences resulting in the highest severity level and have high likelihood of accruing).

D.  Communications.

(1) Operator Communications.  The CHDO should initiate and maintain an open line of communication with the repair station/air agency.  The CHDO and repair station/air agency should continually discuss the repair station’s operational status and projected changes, including FAA surveillance adjustments.  Such collaborative communication is intended to maintain a proactive oversight of the operation.

(2) Internal FAA Communications.  Labor disputes, strikes, and potential bankruptcy actions generate many inquiries, complaints, and opinions from other government agencies, labor unions, the

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