United Airlines Holdings Inc. has reached a new labor agreement in principle with its pilots’ union after more than four years of negotiations. The deal, once ratified, is expected to bring about $10 billion in value over the duration of the contract, according to a statement by the Air Line Pilots Association (ALPA).
While specific details of the agreement were not provided, ALPA highlighted improvements in various areas, including quality of work-life, compensation, job security, work rules, retirement, and benefits. United confirmed the four-year agreement with ALPA and stated that it would result in a significant pay raise and improvements to the pilots’ quality of life. Furthermore, United believes this deal will set the airline on track to achieve its United Next strategy’s potential.
This agreement comes as a relief for United as it has faced criticism recently due to flight delays and cancellations, despite experiencing a surge in demand. CEO Scott Kirby expressed confidence in the overall demand, stating that it could withstand even a moderate economic recession.
The airline industry has been grappling with rising costs, particularly in the labor sector. Earlier this year, American Airlines Group Inc. reached a preliminary agreement that would add $8 billion in additional costs, while Delta Air Lines Inc. approved a new contract with its aviators for a four-year term.
United and the pilot union negotiators will now work on finalizing the language of the agreement in the coming weeks. The union’s Master Executive Council will vote to determine if the agreement becomes tentative, and the group can then proceed with ratification.
In summary, United’s new labor agreement with its pilots’ union is expected to bring significant improvements and value over the lifespan of the contract. This deal will provide relief for the airline as it faces operational challenges and positions it to achieve its strategic goals.
