An American Airlines plane takes off from the Miami International Airport on May 02, 2023 in Miami, Florida.
Joe Raedle | Getty Images
American Airlines pilots approved a sweetened labor deal, making the carrier the second major U.S. airline to seal a latest contract with its highest-paid work group.
The greater than 15,000 pilots at American will get immediate raises of 21% with compensation increasing greater than 46% over the duration of the four-year contract, including 401(k) contributions, their union said Monday. They will probably be due a 5% raise next yr, followed by 4% in 2025 and 2026, followed by a 3% increase in 2027.
Pilots have been pressing airlines for higher compensation and work rules because the industry faces a shortage of aviators within the wake of the Covid pandemic. That crisis derailed negotiations, stopping many staff across the airline industry from getting contracted pay increases, while inflation soared.
An earlier deal between American and the union fell apart after rival United Airlines and that carrier’s union reached a richer, preliminary deal. But American increased its offer last month.
American’s pilots voted greater than 72% in favor of the brand new contract, and there was a 95% turnout, in line with the Allied Pilots Association. The agreement also includes improvements in scheduling and advantages.
American said on Tuesday retroactive pay for the pilots will cost it $230 million within the third quarter. The airline raised its unit cost guidance on Tuesday to a 4% to six% increase compared with the identical period last yr, up from a previous forecast of a 2% to 4% increase, maintaining its annual guidance.
“This agreement will help American immediately expand our pilot training capability to support under-utilized aircraft and future flying and supply our pilots with more opportunities to progress of their careers,” American’s CEO, Robert Isom, said in an announcement.
Delta Air Lines pilots ratified a latest agreement earlier this yr.