American Airlines pilots approve sweetened labor deal with big raises

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American Airlines

pilots approved a sweetened labor deal, making the carrier the second major U.S. airline to seal a new contract with its highest-paid work group.

Joe Raedle | Getty ImagesAmerican Airlines

pilots approved a sweetened labor deal, making the carrier the second major U.S. airline to seal a new contract with its highest-paid work group.

The more than 15,000 pilots at American will get immediate raises of 21% with compensation increasing more than 46% over the duration of the four-year contract, including 401(k) contributions, their union said Monday. The pilots will receive a 5% increase next year. This will be followed by an 4% raise in 2025, 2026 and a final 3% in 2027. The earlier agreement between American Airlines and the union failed after United Airlines and its union negotiated a preliminary, richer deal. But American increased its offer last month.

American’s pilots voted more than 72% in favor of the new contract, and there was a 95% turnout, according to the Allied Pilots Association. The agreement also includes improvements in scheduling and benefits.American said on Tuesday retroactive pay for the pilots will cost it $230 million in the third quarter. The airline raised its unit cost guidance on Tuesday to a 4% to 6% increase compared with the same period last year, 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 capacity to support under-utilized aircraft and future flying and provide our pilots with more opportunities to progress in their careers,” American’s CEO, Robert Isom, said in a statement.

Delta Air Lines

pilots ratified a new agreement earlier this year.