On September 29, United Airlines and the International Brotherhood of Teamsters (IBT) announced that they have reached a tentative agreement (TA) on their first contract following the Continental merger. The TA covers approximately 9,000 “Mechanics and Related” and Flight Simulator Technicians at UA. This is the second TA between UA and IBT; the first was overwhelmingly rejected in February 2016. The TA provides increases to base pay, premiums, retirement benefits, and a partial retro payment.
The last base pay increase for both CO and UA was in 2012. Under UA’s current contract, the TOS hourly rate for AMTs is $31.17, 32% lower than Delta’s. If the TA is ratified by the technicians, the top-of scale (TOS) pay rate for Line Mechanics will be $47.31 inclusive of line, license and longevity premiums and $46.31 for Hangar Mechanics inclusive of longevity and license premiums. These rates are 2-2.5% above Delta’s December 2015 rate. The TA also includes a 1.5% increase one year after date of signing (2017) and 1% increases the remaining five years beginning in 2018. It also provides an “industry reset” every two years that adjusts pay to keep pace with the AA and DL in total compensation.
The TA also adopts the less generous legacy United plan which provides 5% of pre-tax net income, increasing to 10% for profits over a 6.9% margin (approximately $2.5 billion). To provide perspective, based on United’s expected 2016 profitability, this plan will likely yield slightly less than 7.5% profit sharing in 2017.
The voting dates for the TA have not been announced yet.