After five years of bitter negotiations, unionized pilots at FedEx Corp. have ratified a new labor contract.
The four-year agreement addresses multiple areas of employment, including compensation, retirement, scheduling, work rules, and job protections.
The tentative agreement was reached on April 16, with the pilots' union long arguing that FedEx's improved financial performance demonstrates it can afford a better compensation package.
The relatively high disapproval level for the contract reflects the internal divide within the union membership over the negotiating strategy.
In the summer of 2023, leaders on the FedEx union board advanced a tentative agreement to members that would have raised pay by 30% over five years, but they rejected it by a 57% to 43% margin.
The pilots will receive a 40% increase in their hourly pay and other benefits, along with back pay to account for delayed raises during negotiations.
Starting in 2028, they will receive 3% annual raises.
The agreement also includes provisions for job protections and work rules, which were key areas of contention between the union and management.
The National Mediation Board worked for years to bring the sides together, with FedEx raising its full-year guidance at the time and its three-year strategy calls for 14% annual profit growth by 2029.
The pilots' union had long argued that FedEx's improved financial performance demonstrates it can afford a better compensation package.
The new contract takes effect on June 29 and becomes eligible for updating in December 2030, with Capt. Jose Nieves, chairman of ALPA's FedEx Master Executive Council, stating that the focus now turns toward implementation and enforcement of the agreement.
This new contract highlights the ongoing struggle between labor unions and management in the airline industry, with pilots seeking better compensation to match FedEx's improved financial performance.
