We had this argument the other day and I still don't buy this. They may be a "private" group, which is BS since it's been shown that they serve the Frintier colony as a whole, but you're telling me that there's NO ONE who outranks Michel who can pull his ass from the cockpit and be all "Listen soldier, you crack under pressure, you ruin some operations because of your unstable emotional condition that woulsn;t even let you BE in most militaries, you almost killed your own teammate and THEN beat the crap out of him out of nowhere when he called you on it, and you're bringing down troop morale. You're benched for a while."
I mean, despite being his childhood friend and tsundere pseudo-wannabe-girlfriend, Klan seems to have more authority then Michel, even if only in the Pixie Squadron. At least Alto always treats Klan like his immediate commanding officer.