American Airlines’ subsidiaries Piedmont and Envoy have signed new pilot contracts that will make them the highest-paying regional airlines.
The agreements between those airlines and the Air Line Pilots Association (ALPA) come amid a pilot shortage that has caused major airlines, including U.S., to sharply reduce flying within their regional networks. US CEO Robert Isom said last week that the airline has grounded nearly 100 regional jets.
American uses its subsidiaries Piedmont, Envoy and PSA — as well as contract partners SkyWest and Republic Airways — to operate its regional American Eagle routes.
In an effort to boost hiring and retention, Piedmont has now agreed to a first-year captain’s wage of $146 per hour, nearly double the previous rate of $78. $90 per hour.
Piedmont said those wages will be 50% to 70% higher than wages paid by the previous highest-paid US regional airline, Delta subsidiary Endeavour.
“With all bonuses taken into account, a new pilot can expect to earn 31% more in the first five years than pilots with Endeavor and 10% more than pilots on leading ultra-low-cost airlines,” said Piedmont.
Piedmont has also tightened its union contract for experienced captains, who can now earn more than $150 an hour immediately, said Steve Keefer, vice president of the airline’s airline.
“We want to grow this airline, and for that we need pilots,” said Piedmont CEO Eric Morgan. “This deal will attract new first officers and experienced captains we need for future opportunities, while also taking very good care of the pilots already flying to Piedmont.”
The airline aims to hire more than 400 pilots this year.
The increases will take effect two years earlier than when the contract between ALPA’s pilots in Piedmont and the airline can be changed in 2024. And the deal also includes a contract extension until 2029.
In a press release, Piemonte did not address the question of whether the full size of the wage increase will remain in effect after 2024. But if the arrangement is similar to the deal the envoy announced on Saturday, the entry-level wage would be rolled back at that point.
Envoy said that with a contract extension through July 2029, a first officer’s pay will be 10% higher than a regional airline not owned by American Airlines, while the captain’s pay will be 10% higher.
In addition, through August 31, 2024, Envoy’s pilots will receive what the contract calls a “pilot delivery premium” of 50% added to their hourly wages.