Alaska Airlines appears to be patching up disputes with some of its unionized workers, reaching two deals in two days this week with major...
Alaska Airlines appears to be patching up disputes with some of its unionized workers, reaching two deals in two days this week with major employee groups.
Yesterday, Alaska and the Air Line Pilots Association reached a tentative agreement for a new contract that would supersede the terms of an arbitrator’s decision. That followed a breakthrough the previous day with the airline’s flight attendants.
If the new pilot agreement is ratified in a union vote, Alaska’s 1,465 pilots will take an across-the-board 20 percent pay cut, rather than the 22 to 34 percent cut determined by the arbitrator. The contract also would last five years, rather than the current two, and would enact additional work-rule changes to improve productivity.
The contract would take effect July 1 and does not include retroactive pay from the deeper wage cuts that kicked in May 1, the day after the arbitrator’s decision.
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“We’re pleased we were able to sit back down at the table together and come to terms we hope will be a better fit for pilots and the company, as opposed to what we all got through arbitration,” said union spokeswoman Jenn Farrell.
Union leaders will decide next week whether to submit the agreement to a vote. If members ratify it, the union will no longer have reason to pursue a lawsuit it filed against the airline, seeking to vacate the arbitrator’s decision. For now, the lawsuit remains active.
Airline spokeswoman Caroline Boren said the new agreement puts wages and work rules at a competitive level for Alaska.
“We went back to try to get a longer-term deal,” she said. “That provides more stability and certainty and predictability around costs associated with flying our aircraft.”
Management also wanted a more comprehensive contract with pilots than it received from the arbitrator, whose job it was to rule on wages and a limited number of other issues, Boren said.
The agreement calls for additional changes to work rules that will improve productivity, and it allows current employees to choose between the airline’s pension plan and a 401(k)-type plan. Both items are likely to shave expenses for Alaska and could balance the amount it is giving back in wages.
The airline said earlier this month it expected to save $80 million to $90 million as a result of the arbitrator’s decision. Boren declined to say how the latest agreement would change those figures.
Jamelah Leddy, an analyst at McAdams Wright Ragen, said both union deals announced this week appear to be good news from a financial perspective “because the company can get on with the business of running the company.”
The pilot agreement came the day after Alaska announced a general understanding on terms of a tentative agreement with the Association of Flight Attendants, which represents the airline’s roughly 2,400 flight attendants.
Alaska remains in a court battle with another union, the International Association of Machinists and Aerospace Workers, which has asked a federal court to reinstate 472 baggage handlers at Seattle-Tacoma International Airport whose jobs Alaska outsourced. The airline was expected to file a response to that motion late yesterday evening.