United Airlines plans to instate a 5% pay hike for its pilots in December, while talks toward a new multi-year contract continue to drag on.
The mid-contract pay hikes, announced Nov. 10 in an internal memo from United SVP-Flight Operations Bryan Quigley viewed by Aviation Daily, were previously agreed to during the pandemic in exchange for early pilot retirements and other cost-cutting measures.
The pay hikes are actually an acceleration of a previous pledge in that agreement to lift pay once the company realizes 12 straight months of operating margins of at least 5%. While United has not achieved that goal yet, the carrier’s operating margin did recover to around 9% in the third quarter of 2022, which gave management enough confidence to go ahead with the pay hikes ahead of schedule.
“The company could have waited until the May 2023 bid period to pay out the 5% wage increase,” Quigley wrote in the staff memo. “Based on our results through Sept. 30 and guidance for the rest of 2022, however, the company has elected to implement these increases in the December 2022 bid period. This is a show of good faith and a down payment on a market-based, industry leading labor agreement.”
While the announcement was probably intended to mollify United’s pilots, who have expressed frustration with the drawn-out pace of contract negotiations, the carrier’s pilot union appeared mostly unimpressed by the move. In a message to union members issued Nov. 10, the ALPA United Master Executive Council (MEC) said it remains focused on securing an industry-leading contract and pledged to continue with planned demonstrations outside the company’s Denver-based training facility on Nov. 15.
“Make no mistake, the United pilots bought and paid for this raise two years ago, and based on the company’s own forecast, it was expected to pay as early as May,” the union wrote. “Accelerating our raise does not change the fact we still need a contract that fully recognizes the contributions we make every day to the success of our airline.”
The announcement of the pay raise came just a week after United’s pilots overwhelmingly rejected the tentative agreement (TA) they reached with management in May. Speaking to Aviation Daily after the vote, Greg Everhard, spokesman for United’s ALPA MEC, chalked up the TA’s failure to better pay terms offered up in rival carriers’ proposed contracts.
“Right as we were negotiating, American Airlines came out with an even bigger deal, so that derailed the whole thing there,” Everhard said. “Our pilots are not going to stand for anything less than an industry-leading contract.”
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