American Air pilots ask for 30.5% pay raise

[Galaril]

The title says it all and if true is one of those holy fucking shit things. It means either the Airlines are not as bad off financially as they would like us to believe and the pilots now it or the American pilots are greedy and nuts! You decide. Who knows what this will do to this airlines tickets guess I won't be flying American anymore.

http://news.yahoo.com/s/nm/20070503/bs_nm/amr_pilots_dc

[cougarfreak]

Originally Posted by Galaril

The title says it all and if true is one of those holy fucking shit things. It means either the Airlines are not as bad off financially as they would like us to believe and the pilots now it or the American pilots are greedy and nuts! You decide. Who knows what this will do to this airlines tickets guess I won't be flying American anymore.

http://news.yahoo.com/s/nm/20070503/bs_nm/amr_pilots_dc

Not really, it's just a tit for tat thing. The pilots are asking for a big pay hike to make up for lost wages and benefits that they gave up when the airline was in bad financial shape. Then the CEO makes about $6 million and the pilots are ticked off. Can't say as I blame them.

[sterlingice]

Yeah, I seem to remember them taking a big paycut to keep the airline afloat

SI

[Axxon]

I think it's reasonable. Now, if they asked for 30.6%, I'd say screw the greedy bastards.

[SFL Cat]

Kind of hard not to side with the pilots when their boss pays himself $6 mil.

[molson]

So what do airline pilots generally make? I'm guessing they're underpaid. That's not a job where you can call the temp agency and have someone cover things for a few weeks while you sort things out.

[Telle]

When negotiating you always ask for the kitchen sink. This way if they end up with a 15% raise everyone's going to say "wow, they really gave in a lot".

[cartman]

Originally Posted by SFL Cat

Kind of hard not to side with the pilots when their boss pays himself $6 mil.

Except that was a one time bonus that was agreed on when he was hired as CEO if the company reached certain benchmarks, chief among them keeping the company from having to file for bankruptcy. A 30% increase in yearly pay across the board for pilots will cost the company around $400 million in extra costs per year. Considering that American posted a profit of around $230 million last year, their first profitable year since 2000, a 30% increase in pay is not sustainable.

numbers from this article: http://www.chron.com/disp/story.mpl/ap/fn/4773871.html

[cartman]

Originally Posted by molson

So what do airline pilots generally make? I'm guessing they're underpaid. That's not a job where you can call the temp agency and have someone cover things for a few weeks while you sort things out.

AA pilots make an average of $136,000 per year.

[Axxon]

Originally Posted by molson

So what do airline pilots generally make? I'm guessing they're underpaid. That's not a job where you can call the temp agency and have someone cover things for a few weeks while you sort things out.

I am not a commercial pilot but I was an air traffic controller and jumpseated with many of them. At that time, the big airlines were paying pilots of the big birds around 200 - 250 k per year for the captain and less for the copilot and flight engineer. Smaller operations and smaller planes of course got a lot less.

I remember one captain saying ( while we were discussing money ) that he now had more money than he knew how to spend. He had his house, his private plane etc. Every hobby he needed, he indulged.

I could relate to that attitude. Here was a guy who wasn't greedy but was really enjoying his job and his off time as well. I envied the attitude not the salary and I've often thought about it.

Are they underpaid? That's tough. The job really isn't difficult normally. They really aren't being paid their salary for their normal flights. It's when things screw up; that's when they earn their salary. Every penny. For every minute they've ever earned it. Period.

That's my opinion and you know what? From my experience, the fraternity of pilots, commercial or private, is filled with really great members and it's one of the most enjoyable company I've ever kept.

Now, if we have a commercial pilot or someone with more current information, please chime in.

[Axxon]

Originally Posted by cartman

AA pilots make an average of $136,000 per year.

Damn, times have changed or they really did take a huge cut here. I worked with a guy in 2k2 who was working a Delta Express pilot who was part timing with us after suffering a mild heart attack was almost making that and he flew the smaller jets on short hops.

[edit]

oops, you said pilots and average so that counts everybody so this makes more sense to me but seems low anyway.

[edit 2]
Hmm, also, I wonder what the non alcoholic pilots make. Probably a whole lot more.

[cartman]

Originally Posted by Axxon

Damn, times have changed or they really did take a huge cut here. I worked with a guy in 2k2 who was working a Delta Express pilot who was part timing with us after suffering a mild heart attack was almost making that and he flew the smaller jets on short hops.

They did take a 23% pay cut on the last contract to help avoid bankruptcy. But since the company just now posted a profitable year, it is too soon to start asking for the big bucks again. Airlines are the quintessential boom/bust industry, with the bad times far outnumbering the good. Too many times the mistake is made to overpay in the good times, then get slammed hard when you have to keep paying those same amounts in the bad times.

[Axxon]

Originally Posted by cartman

Except that was a one time bonus that was agreed on when he was hired as CEO if the company reached certain benchmarks, chief among them keeping the company from having to file for bankruptcy. A 30% increase in yearly pay across the board for pilots will cost the company around $400 million in extra costs per year. Considering that American posted a profit of around $230 million last year, their first profitable year since 2000, a 30% increase in pay is not sustainable.

numbers from this article: http://www.chron.com/disp/story.mpl/ap/fn/4773871.html

Hmm, if they get the raise and the company goes bankrupt does he have to give the 6m back? They may be going for the 5.4m bonus plan.

[Axxon]

Originally Posted by cartman

They did take a 23% pay cut on the last contract to help avoid bankruptcy. But since the company just now posted a profitable year, it is too soon to start asking for the big bucks again. Airlines are the quintessential boom/bust industry, with the bad times far outnumbering the good. Too many times the mistake is made to overpay in the good times, then get slammed hard when you have to keep paying those same amounts in the bad times.

All jokes aside, I do agree with you 100% but I haven't read up on this but I'm betting there's more here than meets the eye. I'd think there would have to be. Pilots know the business way more than we do and if they're asking for this they must have a plan.

None of them want to go back to flying checks, believe me.

[cartman]

Originally Posted by Axxon

All jokes aside, I do agree with you 100% but I haven't read up on this but I'm betting there's more here than meets the eye. I'd think there would have to be. Pilots know the business way more than we do and if they're asking for this they must have a plan.

None of them want to go back to flying checks, believe me.

In addition to the yearly raise, they are also asking for a one-time bonus of 15% of their salary. The cost on that will be around $400 million. No matter how you slice it, having to shell out $800 million plus when you just made a $200 million profit doesn't make much sense. The union claims all of the amount can be covered by modest fare increases. Any increase will put AA at a competitive disadvantage with competitors that wouldn't have to raise prices due to sharply higher labor costs. Because if the pilots get that much, the other unions will be clamoring for big increases as well. So that "modest" fare hike has to turn into a much larger one.

[Axxon]

Originally Posted by cartman

In addition to the yearly raise, they are also asking for a one-time bonus of 15% of their salary. The cost on that will be around $400 million. No matter how you slice it, having to shell out $800 million plus when you just made a $200 million profit doesn't make much sense. The union claims all of the amount can be covered by modest fare increases. Any increase will put AA at a competitive disadvantage with competitors that wouldn't have to raise prices due to sharply higher labor costs. Because if the pilots get that much, the other unions will be clamoring for big increases as well. So that "modest" fare hike has to turn into a much larger one.

Yeah, I'll admit on the surface it makes no sense, especially with the 15% on top of the raise. I mean, the raise really is only a 7.5% raise over the cut they took so that's why that didn't seem unreasonable though quite possibly unfeasible like you said.

The 15% kicker though, can't really see that one too. I bet there's quite a bit of acrimony behind this decision. Somebody probably thinks that there hasn't been good faith in the negotiations up to now.

[Logan]

Originally Posted by Axxon

Are they underpaid? That's tough. The job really isn't difficult normally. They really aren't being paid their salary for their normal flights. It's when things screw up; that's when they earn their salary. Every penny. For every minute they've ever earned it. Period.

That's still an understatement.

[Axxon]

Originally Posted by Logan

That's still an understatement.

I think the question is whether it's a 30.5% understatement.

[Logan]

Originally Posted by Axxon

I think the question is whether it's a 30.5% understatement.

Well the pilots are asking the wrong people. If during every flight, they got on the PA and said, "Hey, how much will you all pay me to land this plane safely?" a 30.5% raise would look like nothing.

[Warhammer]

I'm sorry, but I don't understand how someone making 6 figures really needs a union. Are their working conditions poor? I don't think so. Heck, even if they are, their making more than 5 times what the per capita income of the country is!

[Shkspr]

If they took a 23% pay cut and are now asking for a 30.5% pay raise, their total change in compensation is .77 x 1.305 = 0.5% total pay increase over their situation before they were asked to take the cut. Looks like they're simply asking for the base salary status quo to be returned. Given the union's precision in figuring that 30.5% number, I'd bet that the 15% bonus spoken of earlier is likewise not pulled out of a hat, and the airline can, in fact, survive paying it out. Did the airline make noises that by taking the pay cut the pilots would be compensated for their sacrifice when times got better?

[Shkspr]

Originally Posted by Warhammer

I'm sorry, but I don't understand how someone making 6 figures really needs a union. Are their working conditions poor? I don't think so. Heck, even if they are, their making more than 5 times what the per capita income of the country is!

Their working conditions are NOT poor...but then, they've got a union. If there's one group of people I don't mind banding together to make sure management isn't working the employees really hard and cutting benefits to get the cheapest workers who'll be able to be replaced at the drop of the hat by someone inexperienced, it's the guy who's flying the metal box I'm several miles above the ground in.

[Logan]

Originally Posted by Warhammer

I'm sorry, but I don't understand how someone making 6 figures really needs a union. Are their working conditions poor? I don't think so. Heck, even if they are, their making more than 5 times what the per capita income of the country is!

PING: MLBPA, NFLPA, NHLPA, NBAPA...

[SnowMan]

I can't speak for American, but Northwest pilots have taken over 50% in pay cuts since 911. Delta pilots are close to that, as well. Alaska Airlines first officers make less than most commuter pilots. It's about time someone mentions raise in the industry.

[flere-imsaho]

Originally Posted by cartman

Considering that American posted a profit of around $230 million last year, their first profitable year since 2000,

Not that you could tell by looking at the state (interior) of their planes and their current levels of service....

[cartman]

Originally Posted by SnowMan

I can't speak for American, but Northwest pilots have taken over 50% in pay cuts since 911. Delta pilots are close to that, as well. Alaska Airlines first officers make less than most commuter pilots. It's about time someone mentions raise in the industry.

I have no problem with them asking for raises, but they have to be economically justifiable. I understand asking for the moon at the start of negotiations, but a 30% raise plus a 15% one time bonus is a complete non-starter, given the wildly fluctuating financial scenario of airlines. Most people don't realize, but the airline industry (all of the companies that have ever flown), since inception, is a total of $100 billion in the hole. $40 billion of that amount was lost after 9/11.

A reasonable alternative would be to switch those numbers around. A 15% raise, with a 30% bonus spread over 3 years would be much more feasible.