Delta Air Lines and the Air Line Pilots Association reached a tentative agreement on a cost-cutting deal that would prevent furloughs for hundreds of pilots during the coronavirus pandemic, officials said Thursday night.
The agreement, which is subject to approval by union members, would provide furlough protection for pilots through Jan. 1, 2022. The deal includes a five percent reduction in mandatory minimum hours for pilots in exchange for scheduling improvements and enhanced retirement savings benefits.
“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 – a key goal of ours from the beginning,” Delta senior vice president and chief of operations John Laughter said in a memo to staffers.
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Earlier this month, Delta reported a $5.4 billion loss for its third fiscal quarter of 2020. Passenger volume was down more than 70 percent compared to the same quarter one year ago. At the time, Delta CEO Ed Bastian warned the airline would furlough roughly 1,700 pilots without a cost-cutting agreement with union representatives or additional government relief.
Air carriers have lobbied Congress for additional relief as they contend with revenue shortfalls during the coronavirus pandemic. Under the CARES Act, airlines received $25 billion in aid and were prohibited from further furloughs until Oct. 1.
The cost-cutting agreement will freeze if the federal government authorizes an extension of relief measures under the same terms established in the CARES Act.
“ALPA has diligently sought creative solutions with Delta to achieve a win/win agreement that preserves pilot jobs while positioning Delta to springboard back to where it was pre-COVID, the top of the airline industry,” Delta pilot and ALPA spokesman Chris Riggins said in a statement. “With the inking of this deal, ALPA’s priority will remain focused on making sure our voice is heard on Capitol Hill as we continue to seek a clean extension to the CARES Act and the PSP despite the recent delays that have been encountered."