Bipartisan legislation introduced in the House on Wednesday would prevent the United States from issuing permits to foreign airlines that could undermine this country’s safety and labor standards.
The legislation is aimed at a practice known as using a “flag of convenience,” when a carrier shops around the globe for favorable labor laws and aviation standards and bases its operations in a country other than its own.
The controversy stems from Norwegian Air, which won permission to fly to the United States in 2016 and now provides flights to Europe and South America from New York, Los Angeles and three other U.S. cities.
Despite its Norwegian homeland, the airline chose to operate under Irish law. In addition to labor and safety concerns, lawmakers and U.S. carriers contend the practice gives foreign airlines an unfair competitive advantage.
“Norwegian is based in Ireland because they have lax labor laws,” Rep. Peter A. DeFazio (D-Ore.), chairman of the House Transportation and Infrastructure Committee and a co-sponsor of the legislation, said Wednesday at an event announcing the bill. “This has become a plague, and we need to bring it to an end, and this legislation would do that. We are not going to allow [foreign] airlines to subvert labor laws.”
Norwegian Air could not be reached for comment Wednesday.
Shopping for favorable labor laws and aviation standards is not exclusive to Norwegian Air, though no list of other foreign airlines that practice it could be provided.
“We all know that some foreign airlines use flag of convenience operations to place parts of their business in different countries around the globe to undercut tax, labor and safety regulations,” said Joe DePete, president of the Air Line Pilots Association. “These venue-shopping efforts allow airlines to undermine pay, benefits for workers, but it also threatens to erode the proactive safety culture that we should demand.”
The issue of foreign carriers holds particular relevance after investigators raised questions about pilot training in the crashes of Boeing 737 Max 8 jets in Indonesia and Ethiopia.
The pushback by pilots and flight attendants in the United States comes as the aviation industry continues to evolve, with more emerging airlines from foreign countries seeking permission to fly into the U.S. market. Though the long-established foreign airlines — Lufthansa, British Airways and Qantas, for example — have long-standing routes and permits to fly here, a new generation of smaller long-range aircraft give Eurocentric airlines the chance to fly to the United States.
Norwegian Air has 35 Boeing 787 Dreamliners and had acquired 18 of the Boeing 737 Max jets, which can fly significantly farther than earlier models of the plane, before the jet was grounded after the crashes in Ethiopia and Indonesia.
“The Fair and Open Skies Act would prevent the Department of Transportation from issuing permits when airlines try to sidestep regulations and labor laws by setting flags of convenience schemes,” said Rep. Rick Larsen (D-Wash.), chairman of the Transportation subcommittee on aviation.
The bill would apply only to new applications — not to Norwegian — but the Transportation Department says it received 35 new applications last year.
Larry Willis, president of the Transportation Trades Department of the AFL-CIO, said the proposed law has a simple purpose.
“We want to make sure that foreign air carriers entering this market abide by our international trade agreements,” Willis said. “If [foreign airlines] hunt out favorable jurisdictions, they would be a flag of convenience carrier.”
Aviation generates $1.5 trillion in U.S. economic activity each year and more than 10 million jobs, according to the latest numbers from the lobbying group Airlines for America. Commercial airlines fly 2.4 million passengers each day and more than 58,000 tons of cargo.