Today is profit sharing day at Delta Air Lines, and in addition to paying out $1.3 billion to employees today (8.9% of salary, or about a month’s worth of pay) the airline has announced that its employees will receive a raise this year.
Delta’s profit sharing exceeds the amounts paid out by the rest of the U.S. airline industry combined and it’s the ninth time they’ve paid out over $1 billion in profit sharing – basically every year since 2014 with a break during the pandemic.
The airline’s employees, like flight attendants, earn more than competitors. Whle they don’t have a union deal, American’s flight attendant union contract tried to mirror what Delta offers but American doesn’t make money. 10% profit sharing of near-zero at American is near-zero, while at Delta is really material.
At United Airlines, employees go years without raises. The following union contracts are currently ‘amendable’ (meaning they’ve expired, and employees keep the same pay without raises until there’s a new contract in place):
- Flight attendants (AFA-CWA) — amendable since August 2021.
- Dispatchers (PAFCA) — amendable December 2024.
- Aviation maintenance technicians (Teamsters) — amendable December 5, 2024.
- Passenger service, fleet service, storekeepers, fleet technical instructors (IAM District 41) — amendable May 1, 2025
Meanwhile, non-union Delta employees generally get raises each year (in fairness, there was a break in this during the pandemic, but Delta didn’t furlough anyone while American and United furloughed more employees than any other airlines in history had previously). They’re able to drive a revenue premium in part because their employees are better, they have a better culture.
The airline has added monthly bonuses (‘shared rewards’) for hitting operational goals, $1,000 payouts for going through personal finance education, and the airline was the first to introduce boarding pay for flight attendants and did it as a true add-on to existing wages (in contrast, at American, flight attendant leaders explained that when they got this provision in their new contract it traded off with wages).
The best workplaces are often non-unionized.
The DL pilots and dispatchers are unionized and UA’s unionized employees are getting almost as much in profit sharing. Good management is far more causal WRT profitability than unionization.
When you treat your employees better (of which, compensation is just one part), you attract and retain better employees. Delta is to the airline industry what Costco is to the retail industry (especially in comparison to Target and WallyWorld). It’s too bad that Southwest used to operate this way, and then just pissed it all away to line the pockets of Elliott Investments.
One of the best things about a non-union environment is that you can pay high performing people well. Unlike a union shop where everyone is considered to be of equal worth, even if they’re a (union protected) underperformed. Another reason we choose Delta first.
on this, rebel and I agree.
DL is simply a better run company and airline. Their unionized and non-union employees both win.
It is most notable that WN used to pay very high profit sharing but it was restricted to retirement accounts. DL’s profit sharing is payable in cash but employees can put it in their retirement accounts.
Boat, car, remodeling and vacation sales always peak in DL hubs in Feb.
AA not only doesn’t provide profit sharing because they make near zero profits but UA’s profits will be reduced by hundreds of millions if not billions per year when their employees quit drinking koolaid and demand to be paid DL-comparable wages.
WN is clawing its way back from the abyss but DL is likely to lead not just airlines but all of corporate America in the size of its profit sharing for years to come.
to amplify on rebel’s comments. UA’s unionized employees may be getting about higher profit sharing than any other non-DL airline, their wages far lag DL’s so their total compensation is much lower.
The notion that unions have helped keep UA employee compensation comparable to DL is simply not supported by facts
and Lance,
DL’s non-union mechanics allow DL to pursue valuable contract work such as engine overhaul rights with all three of the western engine manufacturers that DL can do because it hires retired DL mechanics on a contract basis which unions don’t allow.
All DL employees benefit from the extra revenue from these MRO contracts which have similar examples elsewhere in DL’s workforce.
DL simply has fewer restrictions while its employees benefit and make more as a result of being largely non-union.
Not sure what the issue is.
Employees at one company are always better/worse off than at another company. This is free market/capitalism.
I’m the consumer being presented with a gradually worsening product at constantly increasing pricing. I make my choice of airline and so can employees.
2025 PS: DL:8.9%, UA:7.1%
@ Tim — MUCH lower? Exaggerate much?
Before the MBAs descended on business employers often knew treat your people well and pay them well they will mostly work hard. Back in the late 70s when I was in college I worked in a steel mill during summers. Yeah, it was brutal; the heat, the loudness, the sometimes acid smells. But even as a summer hire I made an hourly wage that would have supported a middle income family.
The company was non unioned and paid very well and had great benefits. People stayed. When workers got older they were put into Foreman/Supervisor jobs. But that would be quaint today and to be honest it would be hard to compete today as the MBAs forced production to poor countries. The same MBA types that babble on about DEI and “equality.”
rebel and Gene,
feel free to tell any UA employee that 1.8% of their salary is “no big deal” and see how fast they will take to hit you up the side of the head.
Even for UA pilots which have the most similar contract as DL pilots, 1.8% amounts to thousands of dollars for the average pilot.
If you spent last time trying to defend the failures of UA and more time actually looking at the people who are impacted by your arguments, you wouldn’t look so ridiculous.
I can assure you that there are conversations in UA’s galleys today about how much more DL FAs are making not just in annual compensation but also in profit sharing – and asking if the union is really worth it.
George,
the airline industry -as well as the steel industry – has long been heavily unionized. Manufacturing jobs can be outsourced but domestic airline jobs cannot. Delta figured out long ago how to maximize benefits for both union and non-union workers and I can assure there are plenty of MBAs at DL.
DL just started with a different formula and has continued to lean into it while other airlines including AA and UA which have long had confrontational employee relations have failed to see their employees as their greatest assets – and they pay the price in the quality of the business and airline they run.
Workers should be paid more. Unless they are workers that are working on their own free will. They deserve nothing but minimum wage, maybe less. Only union workers who get paid based on seniority only should be paid more. We all know that seniority is the only reasonable measure of productivity. Anyone who says otherwise is a fascist white supremacist.
@rebel – remember that UA flight attendants are working under their contract that became amendable 5 years ago and doesn’t have the smae profit sharing terms we see at DL, AA
@rebel gets it. Delta pilots have had a union since 1934!’
@Tim Dunn — Since the management is so good, then, they should be fine with flight attendants, baggage handlers, and maintenance technicians joining those pilots (and dispatchers) in organizing. More profits and additional protections can be a win-win for all of them and DAL.
@Raphael Solomon — Turn down the volume…you don’t need Fox News on full-volume, 24/7.
@1990bot — Yes, @Michael Mainello, “Workers should be paid more.” Finally, you’re getting it. (The rest is hyperbole, though.)
1990
sadly, you don’t get it.
Employees don’t care about how they get paid but total compensation is what they care most about. Work rules in the airline industry are simply not that different between the big 3 carriers.
There is no value in a union and DL proves that every day of the year and twice on Valentine’s Day or the day before when the holiday falls on a weekend. Wow. What a Friday the 13th
It is beyond belief that you rail incessantly about unions and socialism and then tell us how much premium class travel you do. You are the poster child of the hypocrisy of socialists.
none of which, as Gary accurately notes, that DL employees are enjoying the best compensation in the industry because of a combination of high wage scales and record profit sharing – which is a result of industry leading service from the front line and management being the best at what they do.
AA and UA – and every other airline including WN which was once in DL’s camp (or vice versa) simply trails right now and likely will for years to come.
Remember Timmy, if your woody lasts more than four hours seek medical attention.
you lost and can’t admit it so you attack the messenger.
How very “you”
sadly AA and UA employees also lose – that is the point of the article.
Union job is 93% of time better than a non union job. And the relevance matters more, the more demanding (dangerous, risky, etc) the job is.
If given the two choices, I’ll always take union job over non union.
@Tim Dunn — Employees care about how they are paid, in-part and in-total; they also care about how they are treated, what happens to their jobs during a downturn, and so much more.
The fact that you say at the top that rebel is right about the pilots and dispatchers, and yet, revert back to old union-busting talking-points now (“no value in a union”), it’s just sad. You know better.
Finally, don’t feed that troll. (I hope you recognize I am not the one who mocks you like that, here or elsewhere, and I think whoever they are… dude, please stop impersonating others.)
@ Tim Dunn — Sadly, YOU are psychotic. 1.8% of pay after-tax for an average flight attendant is probably about $15/week. That is not “MUCH lower” as you purport. Face the truth — UA is way closer to DL than AA. AA is more like Spirit at this point (effectively bankrupt).
Gene
we are talking about employee compensation, not corporate profits. Tens of thousands of UA employees are well behind AA, DL and WN employees in compensation because of the base salary.
and, again, tell any employee that $15 doesn’t matter so you can win an argument.
I agree with the part of rebel’s comment that mgmt makes the biggest difference and not union vs. non-union status.
and real employees don’t care how they get paid. If it takes a union, they will use a union but DL employees prove they can get higher pay and protections that are just as good w/o a union.
Feel free to share the number of DL FAs that are terminated vs. those at AA, UA and other unionized carriers.
You can’t because there is no gap. Fear mongering just doesn’t work out in reality. If it did DL FAs would unionize. but they don’t. they know better.
After 8+ years as an attorney at the Federal Trade Commission, it is clear to me that this is a classic case of what economists call “raising rivals’ costs” as a competitive strategy. DL knows it can raise AA’s and UA’s costs by paying its workers more. If you have a competitive moat, or an significant efficiency advantage, you use it deliberately to squeeze your competitors where it hurts most.
retired lawyer,
I have said for years that DL’s strategy is to raise its competitors’ costs.
You can tell us how it is prosecuted but I would strongly bet that they can argue that pilot shortages post covid forced them to raise pilot rates – they were the first big 4 US carrier to settle w/ its pilots and did it with large increases – and DL will then say that it has to keep its pilot and non-pilot labor groups compensation in line.
and the reality is that AA, UA and WN aren’t the real target of high compensation. UA has managed to not pay it – but will almost certainly be forced to pay up eventually – while it is the low cost and ultra low cost carriers that are struggling to make money
While UA talks about eliminating competitors, DL has been very careful to not specifically target the competitors whose lives it is making difficult with increased capacity and lower fares.
Rebel is confused. Delta dispatchers got 8.7% profit sharing, United dispatchers got 2.8%.
@Jerry – the union wage premium was once 15% but has now, on average, fallen to zero
“the union wage premium was once 15% but has now, on average, fallen to zero”
Please cite your source. What I found is that union wages are still at a premium over non-union wages, as an average over all workers. Specific work categories had a zero premium and a few had a negative premium. Total compensation is maybe a better comparison so that health insurance and other benefits are also included.
Everyone seems to miss this point: DL pays what it does to PREVENT unionization. It’s the fear of unions that makes them treat their non-union people pretty good.
At one point I worked on the engineering team of a medium-sized company. The shop workers were unionized. Every year, we got the same increase in benefits that the union workers received. We weren’t better, the company just didn’t want us to unionize.
Wiley Dog,
you parrot the same thing as all of the other pro-union folks but you can’t reconcile that DL employees make MORE than other airline employees and that is true for DL’s non-union and union pilots
DL employees make more because the company motivates them to success for the company via profit sharing.
Your theory would only make sense if DL employees only made as much as the best union – but DL employees make more. and profit sharing is a big reason.
Well said, @Wiley Dog. Delta’s strategy has been to wait for American and United (and the others) to get their contracts, then add just a little extra, but it really is an ephemeral benefit, because at any moment, they can layoff and/or change again, for worse. This is why I think the FA and others will join in organizing after the next downturn, which is likely already here.
again, 1990, in your dogma you get the facts wrong.
DL led the industry in settling w/ its pilots for record increases and then followed that up w/ increases for its non-contract employees, long before any of the large unionized airlines even began settling w/ their employees.
DL employees have received multiple pay raises since then.
UA FAs have had no pay raises for years.
There is no evidence that DL terminates any more employees than any unionized airline.
Do you get tired of being proven wrong over and over again?
@Tim Dunn — My, my, my… if true, it seems we should just shutdown all the other companies and let Delta run everything! (Happy?)
no, just acknowledge that DL has an employee compensation and customer service strategy that is unparalleled in the industry.
but since you mention it, I would not be surprised if one of those two N. Texas airline hubs might be in play in the next 5 years
“If given the two choices, I’ll always take union job over non union.” And, I’ve pursued the opposite, and am far better off for it. My only union job cost me money every frigging week for NOTHING.
TD says, “DL competes well. It does not abuse its position of strength. DL has reduced its capacity at both JFK and LGA because it does not want to abuse its leading position”
Retired Lawyer says, “classic case of what economists call “raising rivals’ costs” as a competitive strategy. DL knows it can raise AA’s and UA’s costs by paying its workers more. If you have a competitive moat, or a significant efficiency advantage, you use it deliberately to squeeze your competitors where it hurts most.”
TD says, “I have said for years that DL’s strategy is to raise its competitors’ costs. You can tell us how it is prosecuted”
@Tim Dunn — Make Austin Great Again….
Delta gets it profit-sharing for employees and increase wages is key to employee retention. Hopefully southwest airline typically has smart MBAs to make this happen. I can’t believe American airlines employees have zero performance bonuses are incentive payments after their wages
I don’t think the unionization of the flight attendants is the way to go but as long as they get what they need, it’s all good. We all know unionization has decreased significantly in the past five decades and the reasons are clear when you’re making decisions on behalf of the union not everybody in the group accepts or agrees with the plan, but then they have to for political reasons.
rebel,
I am hardly the first that has noticed that DL is increasing costs for its competitors. There are certainly people in Washington that have watched it.
Either DL’s $1 million contribution to the fund lets them get by with it or they can justifiably say that they raised their own costs in order to attract labor in the aftermath of covid with high inflation.
The feds aren’t dumb.
If DL broke law, the feds will file suit.
and maybe, just maybe, DL figured out what it needs to do to make its employees happy and put the squeeze on competitors – even as UA drags its feet with employees that are increasingly frustrated at the K Koolaid
Exact reason I never fly them the most overrated overpriced airline in America flying
Antique ancient relic aircraft.Glad I’m not a prisoner near any one of their monopoly hubs
That said I am happy for their workers
Hard pass though for this FF
@1990
I can assure you, enlightened one, that I am not Michael mainello, or any other poster here. I am simply an AI algorithm programmed specifically to mimic what your writing style and opinions would be if your IQ were 50 points higher and you had a shred of self awareness.
So many blathering,self appointed know-it-alls on here. Truly nauseating to read the jockeying to be the biggest ass.
Dial it back.
Gary Leff say, “ the union wage premium was once 15% but has now, on average, fallen to zero.”
Wrong.
https://home.treasury.gov/news/featured-stories/labor-unions-and-the-us-economy#:~:text=One%20of%20the%20most%20oft,effects%20for%20longer%2Dtenured%20workers.
@rebel – Ok, go read the underlying study and its footnotes not the press release https://home.treasury.gov/system/files/136/Labor-Unions-And-The-Middle-Class.pdf because they acknowledge work finding “the union wage premium is close to zero.” And that’s a finding by 2004, it’s certainly eroded since then. There was a premium – 10% – 15% – but it’s no longer observable.
So 10-15% unlike what you said.
Also, imagine what airlines would pay workers without unions. Is there one ounce of doubt in your mind that most work rules, benefits and job protections would all but disappear? How about scope protections? Delta pays non-union employees what they do because of the competition’s union contracts to prevent union drives from being successful. And Delta non-union workers would not be getting the profit sharing they enjoy if not for the ALPA pilots negotiating theirs. They should say, “thank you ALPA” and be on their way.
A bit of history is required for context. Profit sharing as it is wouldn’t exist without the very unionized pilots negotiating for it. This all stems from 2007 contract negotiations on the pilot’s behalf.
Delta has a long history of appeasing other work groups by offering benefits that have been won by the pilot group.
This has become an annual farce of sorts glorifying management’s supposed good will. The honest fact is, they couldn’t share it without getting grief and maybe even more unionized work groups. It’s a cost of doing business and nothing more.
Strength to my union brothers & sisters and future members to come.
“The airline’s employees, like flight attendants, earn more than competitors…”
I don’t know what Delta flight attendant pay rates will be with their new raise but since the new contract has been in effect, American flight attendant pay rates have been higher than Delta the last two years. The comment about boarding pay offsetting wages doesn’t really make sense in this light since American’s hourly pay rates are more than Delta and United’s, and translate to be even more than Southwest’s (they use a different pay method but AA’s overall compensation comes out to be higher.)
@Jason – hourly rates aren’t the same as total compensation (literally this post discusses profit sharing – this has to be included)
@Gary Leff — yes, I realize that. It just sounded like to me that the article also inferred that Delta flight attendants had higher hourly rates of pay than their competitors, even though you didn’t specifically say that. So I was just clarifying that they don’t, and that AA’s boarding pay is on top of higher hourly rates. I don’t dispute that Delta’s overall compensation is more than American’s due to their profit sharing. Believe me, AA’s average profit sharing payout of only $150 did not escape me. It’s just that you used the word “earned”. I know profit sharing is considered earnings for tax purposes but in my mind it’s more like a bonus. I’m sorry if I misinterpreted that.
@rebel spot on. The corporate boot lickers pretending this is all for good will is laughable.