American Airlines offers pilots pay rises of up to $64,000 to help end crippling shortages

·2 min read
Pilots sit in the cockpit of an American Airlines jet that's waiting on the tarmac.
The pay offer from American Airlines could bring annual earnings for captains to about $425,000.Stefani Reynolds/Getty Images
  • American Airlines has offered to raise the pay and improve work-life balance of its 14,000 pilots.

  • CEO Robert Isom proposed the 16% increase in an internal video seen by CNBC.

  • The offer matches that made by rival United Airlines to its pilots' unions last week.

American Airlines has offered pilots pay rises of up to $64,0000, or 16.9%, and vowed to improve scheduling and work-life balance in a bid to end crippling shortages, reports say.

Robert Isom, the chief executive, outlined the proposal in an internal video sent to pilots on Thursday and seen by CNBC and the Dallas Morning News. According to a transcript of the video, seen by Insider, the offer could increase pay for the airline's nearly 14,000 pilots by $2 billion by 2024.

American is the latest airline to heed union calls for higher pay and better working conditions as a global shortage of pilots increases the burden on those still working.

Isom promised to raise pilots' pay in a video sent to staff in June. However, American was waiting for the outcome of pay talks between United Airlines and its pilots' union before making an offer.

Last week United offered pilots a 14% pay rise within 18 months, CNBC reported, but staff are yet to accept it.

Isom said in the video that American's proposal matches United's "industry-leading" offer.

As well as a 6% increase and 5% rises at the beginning of 2023 and 2024, American's offer includes "significant improvements" to flight scheduling and quality of life offering, the Dallas Morning News reported.

Under the offer, captains of planes such as the Boeing 737 could get a pay rise of about $45,000, bringing their annual earning to as much as $340,000. Those flying widebody jets such as the Dreamliner Boeing could make an additional $65,000, bringing their annual earnings to about $425,000, Isom told pilots.

Dennis Tajer of the Allied Pilots Association, which represents American Airlines pilots, told CNBC the union is reviewing the proposal.

The Allied Pilots Association did not immediately respond to Insider's request for further comment.

A shortage of pilots has been one factor behind the spate of cancellations, flight delays and hours-long airport queues as airlines struggle to cope with post-pandemic demand for travel.

American Airlines is one of a number of carriers, alongside United, to have nixed flights of late because it doesn't have enough pilots to fly them. Regional airlines have felt the shortage acutely.

In June, American canned routes to Islip and Ithaca in New York, and Toledo, Ohio, flown by wholly-owned regional airlines Envoy and Piedont, because of the shortage.

Read the original article on Business Insider