American Airlines pilots agree to match United’s gains

American Airlines pilots agree to match United's gains

American Airlines’ Pilots Union Reaches Agreement in Principle with the Company

American Airlines

In a major development for American Airlines, the pilots union announced on Thursday that they have reached an agreement in principle with the company on enhancements to a new labor contract. This agreement would bring American Airlines’ pilots in line with the gains their counterparts at rival United Airlines have secured.

The union initially had concerns about the tentative contract agreement and raised requests for improvements. They argued that the ratification of the agreement was in “jeopardy” after United raised the benchmark with its own deal, causing them to delay the vote on the deal. However, with the revised agreement in place, American Airlines’ pilots are now set to enjoy the same benefits and improvements as their United Airlines counterparts.

North American pilots have been commanding higher salaries and improved working conditions, benefiting from the buoyant travel demand and airlines raising fares to cover rising costs. The Allied Pilots Association (APA), which represents over 15,000 American Airlines pilots, did not disclose the specific value of the revised deal. But American Airlines CEO Robert Isom mentioned that aligning the proposed four-year contract with United Airlines’ deal would enhance its value by more than $1 billion, making it worth well over $9 billion.

The revised contract includes a provision to adjust pay rates for pilots to match the wages of pilots at United Airlines and Delta Air Lines, which set the new industry standards with a ratified deal in March. Additionally, the American Airlines revised deal ensures pilots receive full back pay for this year.

To align with United’s deal, pay increases for American Airlines’ pilots will now take place on January 1 instead of the original May 2 provided in the initial agreement. The revised agreement will now be subject to approval from the APA’s board before being sent for a ratification vote. The board is scheduled to meet on August 2-3 to review the deal.

Both American Airlines and the APA expressed positivity regarding the revised agreement. An American Airlines spokesperson described it as a contract that their pilots truly deserve. This agreement comes at a crucial time considering the estimated shortage of about 10,000 pilots in the United States, with the supply-demand gap projected to last until 2027, as per Jefferies analysts.

While the APA had reached a tentative deal with American Airlines in May, they argued that the proposed pay rates and some quality-of-life items paled in comparison to those in United’s preliminary deal. The union advocated for additional sick days to match the gains secured by pilots at Delta and United, among other requests.

It is common for airline unions to negotiate contracts through a pattern bargaining process, where a deal at one carrier acts as a benchmark for other companies. Consequently, Southwest Airlines remains the only major U.S. carrier without a new pilot contract deal.

Ultimately, this agreement between American Airlines and its pilots union represents a positive step forward. It not only addresses the concerns raised by the union but also ensures that American Airlines’ pilots are on par with their counterparts at United Airlines, both in terms of compensation and improved working conditions.

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