Over the next 18 months, United Airlines pilots are scheduled to receive wage increases.
DETROIT (AP) — A contract that would increase United Airlines pilots’ pay by more than 14% over the following 18 months has received approval from the largest pilots’ union, potentially opening the door for comparable pay increases across the industry.
The agreement demonstrates the power that unions presently wield as a result of the industry’s global pilot shortage, which has led to flight cancellations and reduced service.
According to the Air Line Pilots Association, a tentative two-year agreement covering around 14,000 of the airline’s pilots was authorized by the council in charge of managing relations with United on Friday.
Rank-and-file pilots would have to approve the contract for it to go into force. Voting is open through July 15.
The agreement, according to United CEO Scott Kirby, is an industry-leading one that will benefit both the union and the airline.
Since negotiations across the sector were put on pause due to the epidemic, United, a major U.S. airline with headquarters in Chicago, is the first to negotiate a deal with its pilots. Other major airline unions have been keenly following the United contract talks as a potential model for their negotiations.
Pilots at the major airlines have picketed airports and other locations to put pressure on management to offer larger pay increases, even though federal law places a lengthy and challenging process in place before airline workers can lawfully go on strike. With more pilots expressing weariness, airlines that are short on employees have drawn criticism for asking their pilots to work for too many flights.
The United deal, which the union valued at $1.3 billion over two years, would grant three pay rises totaling more than 14.5% through the end of the next year retroactive to the beginning of 2022. According to the union, it also has improved scheduling provisions, a new retirement plan, an 8-week paid maternity leave benefit, and better overtime and premium pay.
The deal will probably cause Wall Street to worry about increasing costs. As travel has recovered from the worst of the pandemic, airlines have already noticed a sharper increase in their prices per seat.
According to Jamie Baker, an airline analyst at JPMorgan, the deal likely exceeds United’s previous projections for cost growth. He claimed that in their discussions, the pilots at Alaska, American, Delta, and Southwest would refer to the tentative United deal, and that other work groups at United would pursue raises comparable to those sought by the pilots.
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