American Airlines To Give Profit Sharing To Employees
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DALLAS (CBSDFW.COM/AP) — Coming off record earnings, American Airlines says it will make profit-sharing payments to employees.
Fort Worth-based 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-flying 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 paid out $1.5 billion last year, United shared $698 million with employees, and Southwest paid out $620 million. At last year's pretax profit, American would have paid about $315 million.
American did admit that their profit-sharing rate will be lower than other airlines. Part of their statement to employees said: "Although this 5% rate is lower than our peers, we plan to offer hourly pay rates higher than those same peers in the contracts we're negotiating now and in those to be negotiated in the future."
Unions, which traded profit sharing for higher base pay in leaner years, would need to approve the profit sharing.
CEO Doug Parker had resisted profit sharing and preferred compensation be set by pay rates. But he told employees Wednesday that there is a team-building benefit to profit sharing.
The company also said it will speed up a 6 percent raise for flight attendants to April 1. The raises were to follow expected increases at United, but bargaining on a new contract at United is still going on.
Last year American Airlines Group Inc. earned $7.6 billion. Excluding one-time items like a big tax-accounting credit, the adjusted profit was a record $6.3 billion.
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