Travel expert Lee Abbamonte warns that the July 4 travel rush does not mean the end of a busy travel year.
American Airlines has announced that it has increased the value of the contract offered to its pilots by more than $1 billion to meet a deal by competitor United Airlines that threatened to call off negotiations.
American announced Friday that the improved offer would increase the value of its four-year contract offer to $9 billion. The airline intends to adopt the pay rates and retroactive payments included in United Airlines’ July 15 preliminary agreement. The deal also includes extended sick leave with a bank of 120 hours, four hours a month, and increased life insurance that increases to $750,000 regardless of age.
Last week, the Allied Pilots Association — which represents American Airlines pilots — warned that ratification of American’s previous contract offer was in jeopardy after United Airlines announced a deal with its pilots’ union in mid-July.
UNITED AIRLINES PILOTS generally achieve a “historic” deal with big pay increases and other perks
American Airlines increased the value of its pilot contract offer by $1 billion to honor a preliminary agreement United Airlines had with its union. (Al Drago/Bloomberg via Getty Images / Getty Images)
Before American revised its offering to match its competitor, United pilots were on track to earn at least 2% more than their American peers. United Airlines pilots will receive cumulative salary increases of 34.5% to 40.2% over the four-year contract.
American Airlines’ revised offer to the pilots’ union includes a ratification bonus, an expedited 401(k) increase, “protecting medical liberty” and several other proposals.
| ticker | Security | Last | Change | Change % |
|---|---|---|---|---|
| EEL | AMERICAN AIRLINES GROUP INC. | 17.42 | -0.02 | -0.11% |
| UAL | UNITED AIRLINES HOLDINGS INC. | 57.61 | +1.04 | +1.84% |
AMERICAN AIRLINES INCREASES PROFIT PROSPECTS ON RECORD TRAVELS
American Airlines pilots, represented by the Allied Pilots Association, will vote on the company’s revised contract offer starting Monday. (Captain Dennis Tajer / APA)
Pilots are scheduled to vote on ratifying the proposed deal starting Monday, July 24. Voting is scheduled to end Aug. 7 and will be overseen by the American Arbitration Association.
The negotiations between pilots and airlines come amid a travel season that has seen numerous weather-related disruptions, exacerbated in part by a shortage of pilots and air traffic controllers, as well as over-scheduling by airlines trying to meet rising demand for flights.
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Earlier this year, the Federal Aviation Administration and airlines decided to reduce their flight schedules in the Northeast by about 10% to give airlines more flexibility when flights are delayed or canceled due to inclement weather. In early July, thunderstorms across the East Coast and Midwest grounded tens of thousands of flights.
The July 4 holiday season this summer broke travel records for the number of passengers passing through TSA checkpoints at airports.
Portal contributed to this report.