American Airlines to share profits with workers
DALLAS - Coming off record earnings, American Airlines (AAL) says it will make profit-sharing payments to employees.
American said Wednesday that it will share 5 percent of its pretax earnings with all employees, except top management, starting in early 2017 based on 2016 results. Including its regional subsidiaries, American has about 118,000 employees.
Some American employees have complained that they don't get profit sharing like counterparts at other airlines. Delta (DAL) paid out $1.5 billion last year, and United (UAL) shared $698 million with employees.
American says its profit-sharing rate will be lower than other airlines, but added that it plans to offer higher hourly pay rates once it finishes renegotiating union contracts. Unions, which traded profit sharing for higher base pay in leaner years, would need to approve the profit sharing.
American CEO Doug Parker had resisted profit sharing and preferred compensation be set by pay rates. But he told employees Wednesday that there's a team-building benefit to profit sharing.
Last year American Airlines Group, which is based in Fort Worth, Texas, earned $7.6 billion. Excluding one-time items like a big tax-accounting credit, the adjusted profit was a record $6.3 billion.