The participation rate was 91.43% and was accepted with 74.69% (transitional agreement) and 69.69% (senior integration agreement). Southwest Airlines Co. LUV has announced the ratification of its five-year employment contract with the Aircraft Mechanics Fraternal Association (AMFA), which represents its 2,400 mechanics. The agreement, of which 95% of AMFA members would have voted, will be possible in April 2024. Under the agreement, southwest mechanics receive a 20% pay increase and $160 million in bonuses. In early March, the company reached a preliminary agreement with AMFA following a bitter dispute with the party, which resulted in several flight cancellations and losses of several million euros. In addition, negotiations between the two groups took six long years before reaching an agreement in principle. (Read more: Southwest Inks Attempt Deal With AMFA: What`s Ahead?) Apart from this good news on the work front, Southwest investors were recently rewarded with a dividend increase of 12.5% to 18 cents per share (72 cents per year). In addition, the Company`s Board of Directors has approved a new $2 billion share repurchase program. (Read more: Southwest Hikes Dividend, announces new buyout plan) In a brief joint statement, the parties said Sunday that more details on the changes to a secondary “letter” will be published as soon as the final language of the treaty is agreed and signed by both sides. While it is not known what these changes will be, or even what the subject of this letter of contract is, it is possible, perhaps even likely, to answer the question of possible further outsourcing of aircraft renovation and repair work abroad.
AMFA, which represents nearly 2,500 Southwest mechanics, had spent six long years discussing a new contract with management. Last September, angry union negotiators signed an interim agreement with the airline, but refused to approve its adoption by high-ranking members. Unsurprisingly, AMFA members strongly opposed the agreement. And no one was surprised when amFA, after a period of new tactical calculation, warmed the heat, when the discussions at the beginning of the year did not put forward a new movement towards their demands. After the management, satisfied, filed a complaint and AMFA, equally satisfied, and as soon as the two parties exchanged old-fashioned rhetoric, the Federal Aviation Administration, which has no formal role to play in contract negotiations in the aviation industry, intervened to tell both sides to reject it. In particular, the FAA has warned parties to no longer use references to security issues that are no longer hidden as a public bargaining weapon. Subsequently, the discussions, chaired by the National Mediation Council, began, culminating in Sunday`s agreement in principle. The parties will continue to meet this week to transform the agreement into the official language of the contract. “Both parties have worked hard to reach an agreement that rewards our mechanics and protects the future of our business,” said Russell McCrady, Vice President of Labor Relations. “Our mechanics are doing a great job of keeping our fleet safe. This agreement gives them well-deserved pay increases and gives the company more flexibility. View original content:www.prnewswire.com/news-releases/tentative-agreement-reached-for-southwest-airlines-mechanics-and-related-employees-300825063.html There were certainly other key factors in securing Sunday`s settlement agreement. The FAA`s unusual involvement in the situation has forced both sides to assess their tactics and weaken their rhetoric and negotiating tactics.