Labor may Mean Problems for Airline Management

By | March 10, 2007

American Airlines is setting aside money to pay its employees their first profit-sharing payments since 2001. This is subsequent to their ongoing labor issues. American avoided bankruptcy in the last decade through cost-cutting and concessions made by labor, and as the employees watch management receiving bonuses…they feel entitled to their fair share after the sacrifices they made.

Delta Airlines has promised its non-union employees pay raises…something they haven’t seen during bankruptcy, when many of them saw their salaries slashed. They may also be offered stock, profit sharing, and company contributions to retirement. However, the details are not yet available.  Some believe it is an effort to head off unionization efforts of these employees as well as complaints about executive compensation due to be announced.