© Reuters. FILE PHOTO: The World Trade Center and New York skyline are seen as United Airlines planes use the runway at Newark Liberty International Airport in Newark, New Jersey, US, on May 12, 2023. REUTERS/Eduardo Munoz/File Photo
CHICAGO (Reuters) – Their union said on Saturday that United Airlines pilots will receive a cumulative 34.5%-40.2% increase in pay in a new four-year contract.
The Airline Airline Pilots Association (ALPA), which represents about 14,000 pilots for the Chicago-based carrier, said it has reached an agreement in principle with United management, which includes substantial improvements in compensation, as well as developments in quality of life, furloughs and furloughs. , and other benefits.
“We are delighted to have reached an agreement with ALPA,” said Scott Kirby, CEO of United Airlines (NYSE: NYSE). “The four-year agreement, once ratified, will provide a meaningful pay increase and improve the quality of life for our pilots while putting the airline on track to realize the incredible potential of our United Next strategy,” he added.
The deal comes months after Delta Air Lines (NYSE) pilots signed off on a new contract that includes more than $7 billion in cumulative pay increases and benefits over four years.
Industry officials say the new Delta contract has become the new standard for contract negotiations in North America.
Rival American Airlines (NASDAQ: ) in May reached a deal with its pilots that provides wages and profit-sharing that match those of the industry’s top companies while improving quality-of-life terms.
With pilots in short supply and demand for air travel booming, pilots have an enhanced bargaining power.
It is estimated that United, Delta, American Airlines and Southwest Airlines (NYSE:) employ about 8,000 pilots this year.
Analysts at Jefferies estimate that the United States has a shortfall of about 10,000 pilots. This supply and demand gap is expected to persist until 2027.
The scramble for talent is forcing airlines to pay more to attract and retain pilots.
The Pilots’ contract with United became adjustable in 2019. Last year, its Pilots rejected a deal that included more than 14.5% cumulative pay increases and a boost to overtime and training wages.
