American Airlines announced Tuesday that they will be using raises as a way to promote new contract deals, easing an impasse that has slowed the company down since its December 2013 merger.
The 4 percent pay raise will reward unions that were able to adapt to a recent merger and form a new contract, The Wall Street Journal reports. Since the merger a year ago, the company and union have been able to form many new contracts, but still have some that are not yet resolved.
“Taking this step just one year into our integration speaks volumes about just how well American is performing,” Doug Parker, the airline’s chief executive officer, said in a staff memo obtained by The Journal.
“We had been intending to make this announcement in late January, when we announce our 2014 results” Parker continued. “But since we already know this year’s results will be very strong, we decided instead to get the news out now.”
The raise will also affect many other employees as well. The pilot union, which has yet to reach a new contract, has also been offered a raise but with conditions. Non-union pay will also rise as well.
According to The Associated Press, pilots have two choices as of right now: They can take the raise, in addition to a multi-year deal that’s already been proposed to them, or forego the raise and move forward with a deal set out in arbitration.
Though the pilots will have lower pay under the arbitrated deal, they would preserve many of their work rules regarding rest, seniority and where pilots are based.
Parker said that unions, including mechanics and ramp workers, who have not yet reached merged contracts, “will now see larger increases when those joint ratified contracts are achieved.”
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