American Airways’ Measly Worker Revenue Sharing

Up to now couple of weeks, we’ve seen most main US airways report their monetary outcomes for 2023. Among the many “huge three” US carriers, the outcomes are precisely what you’d count on — Delta did greatest by an extended shot, adopted by United, adopted by American.

Associated to this, one fascinating factor has been seeing how revenue sharing differs on the main US carriers. American simply introduced the main points of its worker revenue sharing for 2023, and the numbers are leaving individuals very annoyed.

American flight attendants get 1.1% revenue sharing

The precise revenue sharing association differs by work group, although the flight attendant revenue sharing is probably the saddest, particularly in comparison with friends. Among the many “huge three” US carriers, right here’s the revenue sharing association for flight attendants (with the proportion being in relation to eligible annual pay):

  • Delta flight attendants are getting 10.1% revenue sharing
  • United flight attendants are getting 9.2% revenue sharing
  • American flight attendants are getting 1.1% revenue sharing

So yeah, Delta flight attendants are getting greater than 9x as a lot revenue sharing as American flight attendants, and that doesn’t even account for them having higher pay to start with (although American flight attendants are within the technique of negotiating a brand new contract). So it feels like most American flight attendants is likely to be getting a verify for a number of hundred bucks, to thank them for a 12 months of laborious work.

American flight attendants aren’t sharing in lots of income!

Flight attendants confront CEO about disappointment

American CEO Robert Isom held a city corridor with workers as we speak, and there was a heated trade between him and Julie Hedrick, president of the Affiliation of Skilled Flight Attendants (APFA), the union representing flight attendants. @xJonNYC shares a few clips of the interplay, and wow.

Flight attendants have been ready 5 years on a brand new contract, so Hedrick confronts him about that, together with the paltry revenue sharing that flight attendants are getting. As you’d count on, she will get fairly some assist from the viewers. Isom responds by saying that:

  • “We, as an organization, have numerous work to do but, we’re recovering from a extremely deep gap”
  • “We’re not as worthwhile because the trade chief, we’re not, we’re far much less worthwhile than the trade chief, and that’s why all these items that we discuss doing — straightening out our steadiness sheet, getting extra environment friendly, discovering methods to generate extra income, all of that allows us to pay one thing that, let’s face it, is tough for us to do, on condition that we’re not as worthwhile because the trade chief”

Individually, a extra junior flight attendant delivered a heartfelt message to Isom, explaining how her poor pay at American doesn’t even let her reside a snug life the place she will cowl her bills.

What a irritating state of affairs

I perceive why flight attendants are indignant. They need a brand new contract, and haven’t obtained a elevate in 5 years. They’re additionally annoyed by the shortage of revenue sharing, and that simply comes all the way down to American’s small income.

Flight attendants at American deserve a brand new contract, plain and easy, and needs to be paid extra. It’s ridiculous that in 2023, you might have full time workers who’re in some circumstances making lower than $30,000 per 12 months, all whereas being primarily based out of a metropolis with a excessive value of dwelling. This isn’t about greed, it’s nearly with the ability to pay your payments.

However I additionally perceive the place Isom is coming from. American isn’t as worthwhile as opponents, and having trade main pay with out having trade main income isn’t a components for achievement.

Finally what this comes all the way down to is American’s poor administration technique, which I simply can’t wrap my head round. American has been lagging opponents financially for extra years than I can rely. But regardless of that, American has saved the identical administration crew, and so they preserve doing precisely the identical factor and anticipating totally different outcomes. It’s absurd.

American wants a brand new management crew with a brand new imaginative and prescient, somewhat than simply making an attempt the identical factor again and again. American doesn’t attempt to differentiate itself with product. The airline is basically only a huge home airline connecting Charlotte and Dallas to in every single place, whereas flying to some lengthy haul three way partnership hubs, and providing summer time seasonal service to Europe.

Nearly each single one in every of American’s “huge” methods simply hasn’t panned out. Los Angeles transpacific hub? Nope. Seattle lengthy haul hub? Nope. New York lengthy haul hub? Nope. The record goes on…

Right here’s an concept — how about paying American’s high executives purely within the type of revenue sharing? They get a sure proportion of income, and the compensation proportion will increase the larger the income.

A lot about the way in which that publicly traded corporations within the US do enterprise simply makes little sense to me, particularly the connection between executives and the board. For what number of years are you able to let somebody preserve doing the identical factor whereas underperforming, with out considering that it is likely to be higher to strive a recent strategy? The identical will be stated for JetBlue below Robin Hayes’ tenure…

Backside line

American flight attendants have simply discovered that they’re getting 1.1% revenue sharing for 2023, and so they’re not pleased with that, when Delta flight attendants are getting 10.1% revenue sharing. I don’t blame them for his or her frustration.

Finally at American there simply aren’t many income to share, and that’s the fault of the corporate’s management crew, which might’t appear to develop a cohesive technique. American is basically a excessive value model of Spirit, besides with a profitable loyalty program.

What do you make of this American revenue sharing fiasco?

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