contract negotiations
5:36 pm
Thu July 11, 2013

Alaska Airlines, pilots reach 5-year deal without mediation

In an industry known for intense labor disputes and protracted negotiations, there seems to be a departure. Alaska Airlines and its pilots agreed on a new contract on their own—with no mediation, no arbitrators.  

The new contract gives the Alaska Airlines pilots a 20-percent pay raise over the next five years. It also boosts retirement and insurance benefits as well as job security. Of the 94 percent of pilots who turned out, 67 percent voted in favor of the agreement.

Steve Brodersen, a pilot and union volunteer, says while the contract isn’t perfect, the voter turnout is excellent and negotiations went relatively smoothly.

“I hope that we can be a leader in the industry as far as negotiating a contract without it being protracted over one or two years,” he said. “We wanted to shift that thinking with our pilot group and the company to show that it doesn’t have to be contentious.”

Hours after the contract was approved, Alaska Air Group, which also owns Horizon Air, announced a 20-cent per share stock dividend.  Only a small handful of U.S. carriers pay a stock dividend. Airline industry analyst Robert Mann says this points to why Alaska and the pilots were able to reach a speedy agreement.

“Alaska has been a very, very well-run firm. It had investment returns that it could return either to shareholders or suppliers, and, in this case, pilots as a supplier. And I think that being understood, the agreement is only, if you will, how much, not if at all,” Mann said.

Alaska’s pilots and management will now begin implementing the new agreement and discuss changes needed to accommodate new flight duty time rules that will take effect in 2014. 

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