American Airlines mechanics and ground workers will get a double-digit percentage pay raise in November as part of an interim agreement reached between management and unions representing the workers.
The 30,000 ground workers, who are represented by the TWU-IAM Association, will also receive a lump sum payment and retirement improvements as part of the deal. Pay raises range from 15 to 36 percent for mechanics, 24 percent for ground workers, 31 percent for tower planners and 55 percent for weight and balance planners, the Fort Worth-based carrier said.
“Association members will not have to wait to share appropriately in the success of their airline while their negotiating committees bargain hard to complete the process,” said Association chair Sito Pantoj and vice chair Harry Lombardo in a statement.
American is the dominant airline at Charlotte Douglas International Airport and a major Charlotte employer.
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Mechanics, baggage handlers and other ground workers have been without a joint bargaining agreement since American Airlines and US Airways merged in December 2013. The two sides are still in negotiations for a new contract. The union said American is also considering insourcing some maintenance work that has previously been outsourced to third-party firms.
“With 12 diverse workgroups represented by the Association, reaching a single agreement for this specific set of co-workers is taking longer than any of us anticipated,” said American chief operating officer Robert Isom.
In a Securities and Exchange Commission filing made Friday, American told investors the new pay rates will increase its operating costs by $75 million in the third quarter and $120 million in the fourth quarter. The pay rates are comparable to those at Delta Air Lines and United Airlines, the carrier said.
Shares of American climbed 2.6 percent in trading Friday, closing at $34.44.
While other unions, such as the pilots and flight attendants, have negotiated new contracts that included double-digit pay raises, the TWU-IAM workers have not received any significant pay increases since the merger.
However, the ground workers are part of the new profit-sharing plan that American management announced this spring. American is putting 5 percent of every pre-tax dollar it earns in 2016 into a profit-sharing pool that will be shared by 110,000 employees. If American is profitable this year, the payment will be made to workers in early 2017.
“We’re committed to doing things differently at the new American,” said American spokesman Matt Miller. “It’s a new day at American, and a new day for our fantastic colleagues.”