Source: ALPA
On Sunday, July 28, 2024, FedEx pilots, represented by the Air Line Pilots Association, Int’l (ALPA), will reach a milestone in their contract negotiations with the Federal Express Corporation (FedEx)—1,000 days since their contract became amendable on November 1, 2021. The pilots are working under a contract that went into effect in 2015.
FedEx ALPA Master Executive Council chair Capt. Jose Nieves stated, “While our peers at other airlines are rewarded with industry-leading contracts, our pilots continue to be left behind by a company more concerned with shareholder value than employee engagement. FedEx pilots and other employees continue to deliver the ‘Purple Promise’ every day while the Corporation is moving in a strategic direction that appears inconsistent with the career interests of pilots who have made long-term commitments to this carrier.”
The pilots haven’t received a raise since November 2020, while FedEx has achieved record profitability. Since then, FedEx Express, the division the pilots operate under, amassed $5.96 billion in operating income. The Corporation repurchased nearly $7.15 billion of its own stock and returned $3.57 billion in dividends to investors in that same time frame. Chief Financial Officer John Dietrich lauded these efforts that demonstrate a “commitment to creating value for shareholders” in his first full-year earnings call. “When will they reward the over 500,000 employees in the same manner?” remarked Capt. Nieves.
While the pilot group encountered protracted negotiations, FedEx continued to reward executive management and leadership positions with $80.4 million in bonuses, stock and option awards, non-equity incentive compensation, and various other forms of executive compensation. Since assuming the role, Chief Executive Officer Raj Subramaniam’s base salary increased by over 31 percent while the pilots were only offered a 14 percent initial pay raise in the same timeframe, which did not keep pace with inflation. The pilot group has been engaged in contract negotiations with FedEx since May 2021, and under federal mediation since October 2022. The parties reached a tentative agreement that was ultimately rejected by the pilot group in July 2023, due in large part to the fact that it did not reflect the current industry standards nor the strategic direction of the Corporation. Since then, a new benchmark has been set for commercial pilot contracts by nearly every other major U.S. airline.
The pilot group remains in federal mediation and is exercising the opportunities available to them under the Railway Labor Act to advocate in their best interest. “We will continue preparing for all scenarios permitted under the Railway Labor Act to ensure that our pilots receive the contract they have earned—a contract that meets industry standards and provides job security for the future,” said Capt. Nieves. “FedEx provided the first and most reliable express delivery service in the world. It won’t remain that way without a commitment to value its employees, the people who make the network operate. Assuming management is ready to be forthright in negotiations, our pilots stand ready to close a deal that is fair and equitable under current industry standards.”