Southwest Airlines pilots overwhelmingly approved a new contract on Monday that includes double-digit pay raises and increased retirement contributions.
Over 84 percent of the Dallas-based carrier’s pilots voted in favor of the new four-year deal which will become amendable in August 2020.
“This has been an incredible year of pilot unity and resolve. We are now seeing the results,” said Jon Weaks, president of the Southwest Airlines Pilots Association. Of the 8,400 pilots represented by the union, 96.3 percent cast ballots in the ratification vote.
The new agreement includes an immediate 15 percent pay increase followed by annual raises of three percent in each of the next four years of the contract. The pilot’s retirement plan will also move from a 401(k) program to a defined contribution plan.
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“Beyond the compensation and work rule improvements, this forward-looking agreement delivers the operational flexibility needed to grow our network and ensures that Southwest will remain well-positioned for long-term success in our intensely-competitive industry,” said Southwest’s vice president of flight operations Alan Kasher.
The pilots have been in contract negotiations with Southwest for over four years and entered federal mediation in 2014. Last year pilots rejected a proposed contract that included pay raises totaling 17.6 percent but created subsets for pilots who worked international flights and operated Boeing 737-MAX aircraft.
Last week, Southwest’s flight attendants approved a new two-year contract that included a 12.45 percent compounded wage increase and a 15.9 percent bonus.
Shares of Southwest (ticker: LUV) rose $1.19 to close at $41.57 on Monday.