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Southwest's labor challenges grow as 6,100 customer service workers reject deal

Date: May 21, 2022

By Kyle Arnold, Dallas Morning News

Southwest Airlines leaders are trying to figure out why its 6,100-member customer service union overwhelmingly rejected a contract proposal with pay raises, signing bonuses and overtime protections, adding to the carrier’s list of labor worries ahead of the pivotal summer travel season.

Southwest workers who staff ticket counters and gates in airports and field calls from customers voted down the contract earlier this month, the second time since October that the employees have rejected a contract from the company.

Neither the company nor the union is saying why the employees turned down the tentative contract, which gave immediate 6.5% raises, 3% raises each of the next three years, a $1,000 to $3,000 signing bonus and protections against mandatory overtime.

But the rejected deal does come at a time when Southwest Airlines is scrambling to hire workers, from gate agents and ramp workers to pilots and mechanics. It also comes as companies across the country and the world are facing pressure to raise worker wages and provide better working conditions with the highest demand for workers in decades.

“We want to pay our employees well,” said Southwest Airlines CEO Bob Jordan at the company’s annual shareholder meeting Wednesday. “We want contracts for our employees.”

“There are two sides to this and it’s a process, but our desire is to compensate them,” Jordan said.

Southwest Airlines has already cut more than 20,000 flights this summer as it tries to reduce its schedules to adjust for the number of employees it has. The company has hired about 9,000 people since last fall. But the customer service segment is still down more than 1,000 employees compared with before the COVID-19 pandemic, and that group will need to get a boost as the number of travelers return.

“There are two sides to this and it’s a process, but our desire is to compensate them,” Jordan said.

The union representing the workers, District Lodge 142 of the International Association of Machinists, has not responded to requests for more information about why workers rejected the deal. Leading up to the vote, local president John Coveny said he was confident that this deal would gain the support of the union.

Southwest Airlines president Mike Van De Ven said the union is now going back to survey members to ask them why they didn’t want the deal.

Dallas-based Southwest has been trying to balance surging travel demand with a workforce that is both smaller and battered after two years of pandemic flying.

Southwest is also in important contract negotiations with unions for pilots and flight attendants, which have each expressed frustration about how the company is handling the COVID-19 pandemic recovery and how it has treated its workers over the last two years.

There are now open contract negotiations with more than 41,000 workers at Southwest, more than two-thirds of the entire company’s workforce.

It’s not uncommon for a union to reject an airline contract one, two or even three times, but it is when the company has a hard time figuring out what members want, said Robert Mann, a former pilot who is now an airline industry analyst with RW Mann and Co.

“Some of these expectations for a new contract may be the kinds of expectations that they had back in 2018 or 2019,” Mann said. “But now things have changed and it may be driven by inflation, where a 6% raise now and 3% next year might not seem like much because no one expects inflation to be that low in a year.”

Southwest has already boosted its minimum pay rate twice in the last 18 months, from $13 to $17 an hour, so any raises for customer service union workers would be on top of that.

While there is a pilot shortage that is testing the industry, customer service workers are in particularly high demand as stores, restaurants, call centers and thousands of companies look for employees with similar skills.

“Carriers are acknowledging that they are making offers and people are ghosting them on the first day of work,” Mann said. “Working for an airline just doesn’t seem as attractive these days when the flight privileges aren’t as valuable because flights are so full.”

 

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