American CEO Offers Flight Attendants 17% Pay Increase as Union Considers Strike

Skift Take

American CEO Robert Isom told flight attendants they could receive immediate pay raises as negotiations for a new contract become increasingly more tense.

Meghna Maharishi

American Airlines CEO Robert Isom is offering its flight attendants a 17% wage increase as they weigh a potential strike.

Isom also told flight attendants during a town hall Tuesday afternoon that the airline would also revise its formula for higher profit sharing.  

“We will be back at the table with [Association of Professional Flight Attendants] leadership next week and a deal is within reach,” Isom said at the town hall, “but I don’t know how long it will take to get to the finish line and I don’t want another day to go by without increasing your pay.”

However, the union that represents American’s flight attendants said they want a complete contract. 

“This is not the first time management has offered a similar idea, such as the short-term contract earlier in the year,” AFPA said in a statement. “APFA’s position has been Flight Attendants want and need a complete contract.” 

If AFPA agrees to the raises, Isom said they would kick in June 30. He added that the raise is not a “replacement” to a contract. 

“This means we’ve offered increased pay for all flight attendants and are not asking your union for anything in return,” Isom said. “This is unusual. But these are unusual times.”

American Flight Attendants Inch Closer to Striking

Negotiations between American’s flight attendants and management have stalled for months and are now intensifying as the union considers a strike. On Wednesday, AFPA said it would open a strike command center. 

Since airlines fall under the Railway Labor Act, it’s harder for their employees to strike. The National Mediation Board, which oversees negotiations under the RLA, would need to grant the union’s request to strike. And before AFPA members can strike, they would have to wait out a 30-day cooling off period. 

Other airlines are also in the middle of tense negotiations with their flight attendants unions. Alaska Airlines and United Airlines are still bargaining with their flight attendants. Delta Air Lines flight attendants are in the middle of a union campaign to join the Association of Flight Attendants.  

Southwest Airlines just reached an agreement with its flight attendants with 22.3% raises. 

A Sore Point for American

The stalled negotiations among American flight attendants and management have become a sore point for the airline. After chief commercial officer Vasu Raja abruptly exited the company last week, TD Cowen analyst Helane Becker wrote that American needs to reach an agreement with its flight attendants soon. 

“It is taking far too long to get this done,” she wrote in a report May 29. “The company and the flight attendants are in mediation. We believe the National Mediation Board is losing patience with both sides based on various reports.”

During a shareholder meeting Wednesday morning, Isom said, “We’re committed to paying all of our team members well and competitively,” when asked about the state of negotiations with flight attendants. 

Bargaining between the union and management is supposed to resume June 10, and the AFPA said some of the main issues in the negotiations will be “economics and management demands for scheduling concessions.”