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US Airways Flight Attendant Deal Raises Pay, Protects in Merger

Stocks in this article: AAMRQ.PK LCC UAL

CHARLOTTE, N.C. ( TheStreet) -- After five years of talks, US Airways (LCC) and its flight attendants have reached a tentative agreement on a deal that provides some of the industry's highest hourly rates as well as strong protections in the event of a merger.

Talks had moved slowly in the years following the 2005 merger between US Airways and America West, and flight attendants still work under separate contracts. But "the company decided sometime in the past six months that it was important to finish these negotiations and put the two flight attendant groups together," said Mike Flores, president of the US Airways chapter of the Association of Flight Attendants, in an interview. He said federal mediators strongly encouraged both parties to reach a deal.

Additionally, Flores says, management's desire to pursue a merger with bankrupt AMR (AAMRQ.PK) ramped up the pressure to get a deal done, especially because a festering dispute over seniority, now winding its way through the courts, has prevented completion of a contract with the two pilot groups. "It's very easy for them to explain in a merger effort why they don't have a deal with pilots," he says. "But there's no explanation for why they don't have with flight attendants, other than they were being cheapskates."

The contract would extend for five years. At the top 15-year scale, which applies to the majority of both groups, hourly pay would immediately go to $46, up from $41.51 today at the "east," or old US Airways, and up from $37.59 at America West. Three scheduled increases would bring the top rate to $48. Pay would be higher than any legacy carrier now pays, with the exception of Continental, where flight attendants work under a contract rich in hourly pay but with less beneficial work rules.

With flight attendants working an average of 85 hours a month, average top-scale salaries would immediately rise to about $47,000 annually. US Airways has about 6,900 flight attendants, including about 4,600 from the east.

Among work rule improvements, flight attendants will be paid an hour's salary for every three and a quarter hours away from their base, compared with an hour's pay for three and a half hours away under the new United (UAL)contract, the industry leader. Flight attendants will work a maximum of 13 hours a day, compared with 14 hours at most carriers. Deadheading time (when flight attendants return to their bases) will be paid at a 100% rate instead of a 50% rate and will be counted toward the monthly flying total.

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