Airbubba
20th Aug 2002, 17:45
Amid all the doom and gloom, here's some good news (except for their competition):
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Southwest Pilots Approve
Contract Offer Lifting Pay
By MELANIE TROTTMAN
Staff Reporter of THE WALL STREET JOURNAL
DALLAS -- Pilots at Southwest Airlines approved an interim contract offer from the company that raises pay at least 20% during the next two years and extends the existing pact for two years through Sept. 1, 2006.
Approval of the offer, which was an unusual move for Southwest to make at a time when most of the industry is struggling to cut costs, is a plus for the low-fare carrier, which can anticipate its pilot-labor costs for the next four years.
"Our visionary, entrepreneurial pilots have shown, once again, that they are prepared to lead Southwest Airlines through the unprecedented turbulence facing our company and our industry," said James F. Parker, Southwest's chief executive, who has increasingly been under pressure to keep pay comparable with the rest of the industry while keeping costs in check at the low-fare carrier.
The 4,124 members of the Southwest Airlines Pilots' Association approved the offer 68.5%-31.5%. The group's president, who has previously said the offer falls short of the union's goal for an industry-leading contract, called the approval a stepping stone. "We look forward to being compensated accordingly in our next full negotiation in 2006," said Captain Jon Weaks, who noted Southwest's profitability and strong financial health amid losses at other major carriers should give it an edge in the coming years.
The interim agreement also offers pilots additional options to buy 39.2 million common shares of Southwest at Monday's average trading price of $12.835. The majority of those options will vest during the 2004-06 timeframe. Pilots will also get scheduling improvements and increases in medical and retirement benefits.
Pay raises could be as much as 23.8% during the next two years, depending on Southwest's profitability. Pilots will also receive raises of 3.5% to 7.1% in 2005, and as much as 6% in 2006, also based on profitability in those years.
The pilots have been negotiating for more than a year to make midcourse corrections to their 10-year contract. In 1994, they agreed to a five-year pay freeze in return for stock options, which paid off generously. In the fall of 1998, the pilots voted on a midterm contract that included pay raises of 3% a year from 1999 through 2003.
Updated August 20, 2002 11:56 a.m. EDT
_____________________________________________
Southwest Pilots Approve
Contract Offer Lifting Pay
By MELANIE TROTTMAN
Staff Reporter of THE WALL STREET JOURNAL
DALLAS -- Pilots at Southwest Airlines approved an interim contract offer from the company that raises pay at least 20% during the next two years and extends the existing pact for two years through Sept. 1, 2006.
Approval of the offer, which was an unusual move for Southwest to make at a time when most of the industry is struggling to cut costs, is a plus for the low-fare carrier, which can anticipate its pilot-labor costs for the next four years.
"Our visionary, entrepreneurial pilots have shown, once again, that they are prepared to lead Southwest Airlines through the unprecedented turbulence facing our company and our industry," said James F. Parker, Southwest's chief executive, who has increasingly been under pressure to keep pay comparable with the rest of the industry while keeping costs in check at the low-fare carrier.
The 4,124 members of the Southwest Airlines Pilots' Association approved the offer 68.5%-31.5%. The group's president, who has previously said the offer falls short of the union's goal for an industry-leading contract, called the approval a stepping stone. "We look forward to being compensated accordingly in our next full negotiation in 2006," said Captain Jon Weaks, who noted Southwest's profitability and strong financial health amid losses at other major carriers should give it an edge in the coming years.
The interim agreement also offers pilots additional options to buy 39.2 million common shares of Southwest at Monday's average trading price of $12.835. The majority of those options will vest during the 2004-06 timeframe. Pilots will also get scheduling improvements and increases in medical and retirement benefits.
Pay raises could be as much as 23.8% during the next two years, depending on Southwest's profitability. Pilots will also receive raises of 3.5% to 7.1% in 2005, and as much as 6% in 2006, also based on profitability in those years.
The pilots have been negotiating for more than a year to make midcourse corrections to their 10-year contract. In 1994, they agreed to a five-year pay freeze in return for stock options, which paid off generously. In the fall of 1998, the pilots voted on a midterm contract that included pay raises of 3% a year from 1999 through 2003.
Updated August 20, 2002 11:56 a.m. EDT