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Delta Offers Pilots Significant Pay Increase

Business

Delta pilots voted in October to take strike action. | Image by Michael Santiago, Getty Images

Negotiations between four major airlines and their respective pilots’ unions are ongoing as the busy holiday travel season gets underway, but a recent offer by Delta Air Lines may indicate a light at the end of the tunnel. 

Last week, The Air Line Pilots Association, which represents Delta Air Lines’ 14,000-plus pilots, reached a tentative deal that offers pilots a 34% pay increase over a four-year contract. The agreement still requires approval from union leaders and pilots. 

The deal would cost Delta around $7.8 billion in added expenses, if approved, and would give each pilot an instant 18% pay raise

American, United, and Southwest Airlines are also negotiating new deals with their pilot unions and are closely watching what their competitors offer. Airline executives and unions are hoping the first accepted contract will prompt other deals across the industry, according to the Dallas Morning News. 

Delta pilots are calling for industry-leading pay. The tentative agreement includes a promise to pay its pilots at least 1% better than pilots at American or United after those companies reach their agreements. Delta’s deal also offers bonuses for back pay to 2020 and terms for more flexible work schedules, a significant selling point for pilots. 

Delta’s offer is significantly higher than the 14.7% pay raise United Airlines offered its pilots and the 20% over two years that American Airlines offered its pilots. Both deals were rejected, and American Airlines’ contract agreement did not make it past union leaders

If a deal by Delta is reached, it is expected to have a ripple effect that will raise pay across the board in the industry. 

“This is going to be the benchmark,” an American pilot said, according to Reuters.

Southwest Airlines remains the only major airline to fail to come to even a tentative agreement, according to the Dallas Morning News. 

“We’re hoping this [Delta offer] drives Southwest to realize some urgency to getting this wrapped up,” said Casey Murray, president of the Southwest Airlines Pilots Association (SWAPA). 

So why are pilots unhappy? The industry is seeing a significant pilot shortage that is forcing existing aviators to work long hours and unpredictable schedules. According to TheStreet, North American airlines will have 12,000 fewer pilots than needed by the end of next year.

The industry’s mandatory retirement age of 65 is also putting pressure on airlines to fill the gap. Pilots have also been stretched thin due to the surge in post-pandemic travel. Travel spending is 3% higher than 2019 levels, according to U.S. Travel Association.

Murray pointed to scheduling issues as the biggest concern in negotiations, as pilots are becoming frustrated by higher cancellations that make pilots’ work schedules uncertain. 

Southwest and American Airlines pilots want more flexibility in choosing their schedules and incentives to pick up more flights. The airlines say they want to keep enough pilots on reserve to create a buffer when bad weather and other unforeseeable disruptions occur. 

Delta Airlines’ deal offers a 50-100% reroute bonus for pilots who experience route changes, Murray said. 

“We’ve chosen to approach it with a scalpel trying to fix the problem rather than a hammer,” Murray said of SWAPA negotiations. “We have a lot more options being a point-to-point network.” 

American Airlines offered “quality of life improvements” in its deal that was rejected In November.

As contract negotiations continue, pilots are exerting pressure on the airlines during the busiest travel season of the year. Pilots at Delta have threatened to strike, and pilots at Southwest Airlines are planning an informational picket in New York during the company’s investor day on Wednesday.

United Airlines pilots are expected to picket in Houston on Wednesday during the company’s board of directors meeting. 

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