No Deal: American Airlines Flight Attendants Told To Brace For Strike Over Pay Dispute – View from the Wing

No Deal: American Airlines Flight Attendants Told To Brace For Strike Over Pay Dispute – View from the Wing

No Deal: American Airlines Flight Attendants Told To Brace For Strike Over Pay Dispute

American Airlines and its flight attendants were at the negotiating table with federal mediators in Washington, D.C. for the last six business days. As aviation watchdog JonNYC shares, the union reports back that no agreement was reached. They expect the National Mediation Board to insist on one ‘last ditch effort’ to reach an agreement early in June before declaring an impasse, which would start a 30 day ‘cooling off period’ before releasing the parties to ‘self-help’ (a strike).

American Airlines flight attendants have not gotten a raise since January 1, 2019, and they’ve seen the value of their wages eroded significantly by inflation. Delta and Southwest flight attendants now earn more than they do.

Friday was ‘International Flight Attendant Day’ and the union used it to tell cabin crew that they demand a ‘fair share of the profits’ though it is not at all clear what that would be? American’s spending on flight attendants exceeds its profits many times over.

It’s this lack of profitability that is a real problem in negotiations, because there’s less to bargain over. Even as American Airlines offers the same profit sharing formula Delta uses with its flight attendants, American cabin crew will earn less because American earns less profit.

Flight attendants have significantly reduced their wage demands while the company has increased its wage offer. However there’s still a gap in pay, and especially on retro pay (make-goods for the four and a half years of no increases since the contract became amendable), as well as work rules.

The union further complains that American mishandled recent bad weather schedule disruptions, stranding flight attendants without hotels again.

The American Airlines flight attendants union is telling its members to ‘prepare to strike’ although they aren’t telling flight attendants how to prepare. First and second-year Boston-based flight attendants are eligible for food stamps.

This isn’t a work group with significant cash reserves to ride out a storm, or a union with the reserves to fund one. Instead we would likely see the union no show specific flights changing each day, rather than a full strike. This would allow most of its members to continue to receive pay, while creating uncertainty for customers who might book away from American.

Despite there not yet being a deal, though, the standard for being released to self-help is an impasse. If the parties appear to be making progress towards a deal, the National Mediation Board should not release flight attendants to strike. There will be a lot of pressure to keep them at the bargaining table, as they’ve done for six months (flight attendants wanted to strike at Christmas). A majority of the board are Democrats appointed by President Biden.

A strike at American Airlines would be both bad for the economy and for passengers, and therefore bad for Biden right before the election. He would face pressure to intervene to end a strike, as President Clinton did with American Airlines pilots and with flight attendants (the latter, pressing the parties to agree to binding arbitration rather than ordering employees back to work). Biden won’t want to intervene and anger labor going into the election however. Biden needs the parties to come to an agreement without a strike, and needs the National Mediation Board to kick the can down the road until they do so.

Ultimately I did not actually expect a final agreement in Washington this past week, we’re closer than ever before to one, so hopefully a deal can be reached and job action avoided. Management certainly cannot afford one, having just revised earnings guidance downward and with its stock under significant pressure.

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