Delta Air Lines and the Air Line Pilots Association (ALPA) have agreed on a deal in principle providing furlough protection for its pilots until January 1, 2022. The agreement, yet to be approved by Delta’s almost 13,000 pilots, also reduces monthly minimum guaranteed hours by 5% and provides improved retirement savings benefits.
In August, Delta announced it was set to furlough 1,941 pilots while warning of additional furloughing in the future. With the latest tentative agreement, all of Delta’s pilots will be afforded protection from furloughing until January 1, 2022. According to FlightGlobal, Delta pilots will now have until November 28 to agree to the new deal.
Delta has sought to avoid a mass furloughing of its pilots for several months. The latest agreement was struck just days before Delta pilots were set to undergo furloughing schemes.
John Laughter, senior vice president and chief of operations at Delta, summarized the deal: “This agreement is the result of partnering with ALPA and finding common ground. It contains several quality of life improvements while allowing Delta to generate much needed savings through a path to help avoid furloughs.”
The Atlanta-based carrier is doing all it can to cut costs after reporting losses of $5.4bn for the third quarter of 2020. Chief of operations, John Laughter, claimed in August that the airline was “overstaffed” and recovered just 25% of its revenue over the preceding six months. Despite unprecedented financial losses, Delta is still committed to avoiding furloughing its staff, including flight attendants.
Contrary to most major airlines in the United States, Delta is yet to furlough any staff after the CARES Act aid program expired in October. Under the CARES Act, airlines in the United States received $25bn in aid and were prevented from furloughing staff until October 1. Delta instead offered its staff early retirement packages and voluntary leave to avoid cuts and furloughs.
Staff at Delta have had to adapt to innovative cost-cutting measures introduced by the airline. For example, flight attendants have been involved with catering and customer support to secure their jobs. Even the Delta CEO, Ed Bastian, gave up his base salary for six months to minimize costs.
With pilots given an extended deadline to reach a decision on the new terms, the next few weeks will have a major impact on the fortunes of Delta Air Lines.
Delta pilots union chairman Ryan Schnitzler commented: “What transpires will impact not just the new generation of Delta pilots but also Delta itself for many years to come.”
As part of the deal in principle, the agreement will be put on hold should the government extend the CARES Act under the same terms of the previous package. Presently, there is little to suggest the United States government plans to introduce a new stimulus package any time soon.
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