In another sign of the leverage that unions wield during an industry-wide labor shortage, Delta Air Lines has offered its pilots a 34% pay increase over three years in a new contract.
Just before the July 4th holiday last summer, Delta Air Lines pilots picketed at Los Angeles International Airport during a protest over the union contract.
If Delta pilots approve the deal, it is expected to cause a domino effect with contract negotiations at fellow legacy carriers where labor deals have been scuttled. “The unintended consequence of Delta’s [agreement in principle],” wrote Jamie Baker, J.P. Morgan analyst, in a note to investors, “is that it’s likely to ignite the negotiating afterburners at American, United and Southwest.” Notably, American AirlinesAs sure as the sun rises in the east, increased labor costs will mean that consumers will end up paying more for flights.
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