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American Airlines flight attendants' strike unlikely as deal nears

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American Airlines flight attendants' strike unlikely as deal nears
Research
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Gary Leff Chief Financial Officer | View from the Wing

The American Airlines flight attendants union has altered its stance, moving away from the assertion that a strike is imminent. The threat of a strike has, however, brought them closer to reaching an agreement with the airline.

American Airlines has increased its pay offer. As long as these increases continue, the federal National Mediation Board (NMB) will likely maintain its order for continued bargaining rather than permitting a strike.

The union acknowledges that they are no longer "billions of dollars apart" from the company regarding the value of a new contract. They have credited American Airlines for raising its offer after Delta Air Lines provided raises to its non-union flight attendants. This recognition aims to reduce tensions and highlight progress in negotiations.

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The union praised American Airlines for improving upon an older 11.2% wage increase offer, despite previously rejecting a 17% increase while talks were ongoing. They now emphasize that the improved 17% offer also includes increased boarding pay. According to the union, this process has resulted in over one billion dollars being added to the agreement beyond earlier proposals.

Recently, American Airlines further enhanced its economic proposal, addressing issues such as wage increases above Delta's levels, per diem increases, future wage hikes, retroactive pay, and resisting scheduling concessions. The union now uses Delta as a benchmark instead of Southwest Airlines' new contract or selectively comparing items from both airlines.

Despite some remaining differences in negotiations—such as date-of-signing wage increases and other key issues—the union is no longer stating that they are far apart from reaching an agreement. They seek more money but have stopped demanding full retroactive pay explicitly (though some signing bonus with retroactive pay is expected).

Interestingly, the union views not being released to strike positively: "During this period, the company made enough movement to... make more negotiations warranted... it delays our negotiations and our right to strike [but] puts hundreds of millions of dollars into our pay and other provisions."

Negotiations are set to continue next week in Phoenix. The union expressed readiness "to close the remaining gap," signaling willingness to compromise rather than insisting on meeting all their terms.

An outstanding question remains whether elevated expectations among cabin crew about potential earnings will impact acceptance if a tentative agreement falls short of promises made by Union President Julie Hedrick.

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