Delta Air Lines is increasing base pay for all ground crew and flight attendants by 14.5 percent, a move that will lift compensation for more than 6,000 of its Twin Cities employees.
The global Association of Machinists and Aerospace Workers, which is trying organize Delta flight attendants, said raises were overdue and left Delta employees below industry-leading pay.
Thousands of Twin Cities Delta employees will get a 14.5 percent raise, the airline giant announced on Wednesday. Members of the union voted to reject the package, with some arguing it did not match the company’s improved profitability.
Delta CEO Richard Anderson and president Ed Bastian told employees in a memo that the company is giving “record pay raises in a year of record profits”.
While Delta is moving to boost base pay, it also will change its profit-sharing formula.
The change means that if Delta’s profit continues to grow, the company will pay out less in profit sharing than it would under the old system.
Under the current plan, employees share a 10 percent slice of profits, and 20 percent if the company exceeds $2.5 billion.
Delta noted it has more than returned more than $3 billion to shareholders in the last two years and has reduced its debt by $10 billion, while continuing to invest in aircraft, the onboard customer experience and upgrading facilities worldwide.
At the same time, Delta made changes to its long-standing profit-sharing program, which pays out every February, that will reduce bonuses from highly profitable years.
However, it will increase the payout when profits fall below $2.5 billion and then recover the next year.
The company said it will pump more money into employees’ base pay, and increase its 401(k) contributions after a period of bumper profits, but will scale back its profit-sharing plans for employees.