Delta’s Offer to Pilots Gets Lukewarm Reception

Delta Air Lines Inc. made an offer in contract talks with its pilots that would initially make them the highest paid in the industry, but the proposal contains a performance-based formula for subsequent increases that left the union cold. Delta, the No. 3 U.S. carrier, said it offered a 17.5% initial wage hike, leapfrogging recent gains won by pilots at UAL Corp.’s United Airlines, but somewhat less than the union’s latest proposal. Delta’s offer takes the unusual step of linking subsequent pay increases to corporate profit margins and pilot productivity. “You essentially get pay rates based on management performance, and it also creates an incentive for pilots to fly when they’re sick,” said Karen Miller, a spokeswoman for the Air Line Pilots Assn. The proposal bases pay on factors that “we’re not sure are appropriate for pilot pay raises to be based on,” she said. In addition, Delta proposed an eight-year contract, while ALPA had sought a three-year deal. Delta said it will respond to the union on other issues in early December. Miller said the union will study the pay offer and withhold a counterproposal until it receives the rest of Delta’s proposals. Atlanta-based Delta’s shares closed off 44 cents at $47.25 on the Big Board.