Allegiant Air’s Summerlin headquarters was a happier place Wednesday after late Tuesday’s announcement that the airline’s management and the Teamsters union representing the airline’s pilots had reached a tentative contract agreement.
It’s the Las Vegas airline’s first labor agreement.
Now, the work will shift to completing the contract language, explaining the deal to pilots in a series of “road show” presentations and a ratification vote, expected to occur in late July.
The announcement came after more than three years of tension between the two sides that included a court battle over a threatened strike and union allegations that the airline was cutting corners on maintenance practices that made its planes unsafe.
Allegiant stock seesawed in Wednesday trading, ultimately closing down $1.73, 1.2 percent, to $143.34 a share in moderate trading.
Representatives of Teamsters Local 1224 said they would meet with company negotiators next week to work out the final contract language.
Once the final draft is completed, it will be distributed to the company’s more than 700 pilots.
Union leaders plan presentations and question-and-answer sessions with pilots in July. Once that has been completed, the contract will be put to a vote, a process that could take several days.
Pilots will vote electronically via computer and a simple majority will determine whether the agreement passes or fails. Union officials have not yet determined when voting would begin and end.
Union representatives who worked to negotiate the tentative agreement are confident that the contract will be approved.
Scott Whitman, the pilots’ negotiating committee chairman, said he thinks contract improvements will be well-received by the pilots.
“Since we voted to join Teamsters Local 1224 in 2012, we have been committed to working with the company to reach a contract that fairly rewards the pilots for their vital contribution to the company’s operations and success,” Whitman said in a statement distributed by the union. “Our tentative agreement with the company meets that objective and I believe the pilots will be proud to work under it.”
Allegiant management and union officials agreed among themselves not to speak publicly about details of the contract until after it was delivered to the pilots.
The contract includes improved scheduling procedures, pilot participation in a company profit-sharing plan, improvements in medical coverage benefits and a better 401(k) retirement program as well as higher pay rates.
Relations between the union and Allegiant management haven’t always been cordial.
The pilots voted in August 2012 for representation by the Teamsters and the two sides have been working in mediated sessions with the National Mediation Board since February 2014.
Management officials reported moderate progress in negotiations late last year, but the union continually sought release from the mediated sessions throughout the process.
Allegiant CEO Maurice Gallagher, in the early stages, said he was opposed to negotiating a contract “with a third party,” but he acknowledged throughout the process that the airline was required to do so with existing labor laws.
Once the deal was announced, Gallagher said in a statement issued by the company that, “This contract, once approved by our pilots, will allow us to move into a new chapter at Allegiant.”
Allegiant, the most profitable airline operating in the United States, is built on a model of connecting resort cities with small towns with limited air service. Most of the cities served have little or no airline competition.
In the past year, the airline has branched out to larger cities that have lost service with the departure of legacy carriers.
Allegiant has recently made its mark in Cincinnati, Albuquerque and Baltimore.
Contact Richard N. Velotta at firstname.lastname@example.org or 702-477-3893. Find him on Twitter: @RickVelotta