United Continental Holdings is hoping to achieve labor peace with its pilots by offering a 13 percent pay raise just five years after the airline was created in a merger, according to reports Wednesday.
The company was born in 2010 when United Airlines merged with Continental Airlines. The proposed agreement is a two-year extension of the previous contract as opposed to an entirely new one. It will include a 13 percent pay raise for pilots in 2016, sources tell Bloomberg. The company negotiated the proposal with the Air Line Pilots Association (ALPA).
“The fact that we were able to reach this Agreement in Principle in fewer than 30 days is a direct result of the positive, collaborative relationship between ALPA leadership and United,” Executive Vice President of Human Resources Mike Bonds said in a statement. “We appreciate the hard work of the company and union negotiating teams in helping us reach an Agreement in Principle that will benefit pilots and United.”
Additionally, the initial 13 percent increase will be followed by annual increases between 2 and 3 percent. The proposed contract will cover 12,000 pilots over two years. The proposal is subject to a ratification process which includes a review and consideration by the Master Executive Council.
United first announced the agreement Nov. 20 but did not reveal the specifics of it. If approved by the pilots, it will make them some of the highest paid in the industry. If rejected, however, the pilots could start negotiating in May for a permanent contract.
The company is also dealing with several other labor negotiations.Its mechanics have yet to accept an agreement. Additionally, flight attendants splits between those hired before and after the merger also need their own separate labor agreements.
If approved the contract will settle issues present since the merger. New CEO Oscar Munoz tells Reuters the integration process has been tough for both employees and costumers. Munoz is currently on temporary leave as a result of a heart attack.
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