At the moment we’re seeing pilots at most major US airlines trying to negotiate new contracts. They didn’t have much leverage to negotiate during the first two years of the pandemic, and withpilots now being in such high demand, this is obviously a great time to try to get a new contract.
Back in October 2022, Alaska Airlines became the first major US airline where pilots ratified a new contract. In December 2022, Delta Air Lines pilots reached a new agreement in principle with its 15,000 pilots. That has now been formally approved, and that has implications for the airline and for the industry overall.
The basics of Delta’s new contract for pilots
Delta pilots have officially ratified a new contract, with 78% of pilots voting in favor of it. With this contract, we’ll see pilots at the Atlanta-based airline getting a huge pay bump. This new contract is worth $7.2 billion in value over the course of four years.
This new contract includes significant pay increases, both retroactively and going forward:
- Pilots will immediately receive an 18% pay increase, as of the day the contract is signed
- Pilots will then receive a 5% pay increase one year after that
- Pilots will then receive two 4% pay increases in the two years that follow
- Pilots will receive a one-time payment of 4% of 2020 and 2021 pay, plus a 14% payment of 2022 pay
- In the event that American or United negotiate a contract with better pay, Delta will get that pay matched, plus 1%
On top of that, pilots will get quality-of-life improvements, which will make up roughly one-quarter of the value of the overall agreement. This includes things like 10 weeks of paid maternity leave, two weeks of paid paternal leave, significantly improved crew meals, improved health insurance, and more. Interestingly this contract also includes a provision that “establishes medical freedom protections.” Oh my…
While this is an expensive contract, it’s good to see that these negotiations are now behind the carrier. In October 2022, Delta pilots voted to authorized a strike — 96% of pilots cast votes, and 99% of those pilots voted in favor of authorizing a strike.
Admittedly this was more about sending a message to management than anything else, since authorizing a strike is only the first of many steps to a strike actually happening. We haven’t seen a strike among pilots at a US airline for more than 15 years.
How much will Delta pilots be paid with this new contract?
I’ve written in the past about how much airline pilots are paid, and the general math that goes into that. Airline Pilot Central publishes pay rates of all the major airlines, including Delta.
Delta first officer pay ranges from $92 to $242 per hour, while Delta captain pay ranges from $238 to $334 per hour. You can generally just add three zeroes to the end of that to roughly figure out annual pay, though with Delta it’s usually even a bit higher than that, thanks to profit sharing. With this contract now being ratified, Delta pilots will be looking at pay raises of 34% over the next four years.
In other words, Delta’s most senior captains will be earning roughly $440 per hour, or around $440K per year (and probably even more than that).
With American and United both currently negotiating contracts, you can bet that pilots at both airlines will be looking to Delta as a benchmark. For that matter, even with Delta pilots having approved this new contract, they’ll be looking at the contracts of American and United, as they can potentially get those contracts matched, plus 1%.
Also keep in mind that even though Alaska has finalized its contract, there’s a provision that if pilots at other airlines get a better contract, Alaska will match it. Alaska pilots are entitled to the average of the top of the pay scales of American, Delta, JetBlue, Southwest, and United, so these pilots could be looking at some additional raises as well.
Bottom line
Delta management and the union representing pilots have agreed to a new contract. The contract is worth $7.2 billion to pilots over the next four years, and includes an immediate 18% pay raise, a further 13% in pay raises in the next three years, retroactive pay raises, and quality of life improvements.
You can bet that both executives and unions at American and United are watching this closely, because it probably gives them a sense of what they can expect to pay.
I’m happy for Delta pilots, though there’s also no denying that labor costs in the airline industry (and so many other industries) are increasing considerably, further leading to inflation. With most airlines introducing lucrative new contracts for employees, that will be reflected in our ticket costs in the long run. I guess that’s how the cycle of inflation works, though.
What do you make of Delta’s new pilot agreement?
