United Airlines pilots reach labor agreement with company

Pilots at United Airlines will get cumulative 34.5%-40.2% increase in pay raises in a new four-year contract, their union said on Saturday.

The Air Line Pilots Association (ALPA), which represents about 14,000 pilots at the Chicago-based carrier, said they reached an agreement in principle with United management, which includes substantial improvements to compensation, as well as advancements in quality of life, vacation, and other benefits. "We're pleased to have reached an agreement with ALPA," United Airlines CEO Scott Kirby said. "The four-year agreement, once ratified, will deliver a meaningful pay raise and quality of life improvements for our pilots while putting the airline on track to achieve the incredible potential of our United Next strategy," he added.

The deal comes months after pilots at Delta Air Lines ratified a new contract that includes over $7 billion in cumulative increases in pay and benefits over four years. Industry officials say Delta's new contract has become a new benchmark for contract negotiations in North America.

Rival American Airlines in May reached a deal with its pilots that provides pay and profit sharing that match the top of the industry with improved quality-of-life provisions. With pilots in short supply and air travel demand booming, pilots are enjoying enhanced bargaining power.

United, Delta, American Airlines and Southwest Airlines are estimated to hire about 8,000 pilots this year. Analysts at Jefferies estimate the United States is short about 10,000 pilots. This supply-demand gap is projected to last until 2027.

A scramble for talent is forcing airlines to pay more to attract and retain pilots. United's pilot contract became amendable in 2019. Last year, its pilots turned down a deal that included more than 14.5% in cumulative wage increases and enhanced overtime and training pay.