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Southwest Airlines

Southwest Airlines reaches tentative contract with flight attendants  Mar 26, 2009

Southwest Airlines has inked a tentative contract with its flight attendants that will boost pay and benefits, the third major union deal the airline has reached in recent months.

Officials with the Dallas-based airline and the Transport Workers Union signed off on the deal Thursday morning. Specific details were not yet available, but Southwest has recently negotiated agreements with pilots and mechanics that included wage increases.

"This round of negotiations was conducted with a spirit of cooperation and partnership that demonstrates the legendary culture of Southwest Airlines," said Thom McDaniel, president of TWU Local 556. "Times are tough in the airline industry, but labor relations don’t have to be."

Union officials said the tentative deal would improve wages, boost 401(k) contributions and improve leave options, flexibility and job security. It contained no economic concessions, officials said.

"We are pleased with this mutually beneficial contract that delivers enhancements to pay and benefits for our hard working flight attendants," said Daryl Krause, southwest's senior vice president of customer services. "This agreement demonstrates (the union's) commitment to maintain Southwest's unique culture, competitive position, and financial strength during these challenging economic times."

Southwest has about 9,800 attendants in its work force.

The four-year deal comes as Southwest is paring back flights and coping with a decline in demand for travel. The discount carrier is also facing rising expenses on several fronts despite its renown low-cost business model.

Still, it maintains a cost advantage over most rivals despite higher-than-average pay for most employees. Pilots, for example, have the highest salaries in the industry.

The flight attendant contract still must be ratified by union members. Union officials said they would make the agreement available to members on April 8

The last contract, which was completed in 2004, took four years to negotiate in an unusually hostile atmosphere. The deal was reached only after legendary Southwest co-founder Herb Kelleher personally took over talks.

This contract has been much smoother. Talks began in May 2008, and have been relatively low-key. It's a stark comparison with Southwest's North Texas rival, Fort Worth-based American Airlines, which is negotiating contracts with all of its major unions.

Those talks have been far less fruitful, and pilots have publicly blasted American executives as incompetent. All of the American talks have been taken over by mediators from the National Mediation Board.

Shares of Southwest were up 31 cents in mid-day trading Thursday, at $6.45 per share.

Southwest Airlines reaches tentative contract with flight attendants
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