Labor unions are campaigning against the resumption of airline stock buybacks: Travel Weekly
Unions representing U.S. airline workers have begun a campaign calling for airlines to refrain from resuming stock buybacks until they have achieved operational normalcy.
“We’re asking airline executives to show us that providing high-quality service and supporting their workers is more important to them than increasing the wealth of a handful of Wall Street investors,” said Richard Honeycutt, vice president of the Communications Workers of America’s District 3, which represents customer-service agents at American Airlines.
Under the Payroll Support Program, which awarded $58 billion in payroll grants to airlines and airline contractors during the pandemic, carriers have been banned from stock buybacks since March 2020. That restriction, however, will lift on Oct. 1.
Unions representing pilots, flights attendants, customer-service agents, aircraft maintenance technicians, groundworkers, dispatchers and others have joined the Demand No Stock Buybacks campaign. In total, eight unions are part of the effort.
According to the unions, U.S. airlines spent $47 billion on share buybacks in the 2010s, including $39 billion in buybacks from United, Delta, American and Southwest between 2014 and 2019.
The unions are calling for airlines to pledge that they won’t resume stock buybacks until they have concluded labor contract negotiations and until “operational meltdowns are not the norm and staffing and flights schedules are aligned to support public demand.”
According to FlightAware, so far this year U.S. airlines have canceled 2.6% of flights and delayed 21.3%, up from a 2.1% cancellation rate and 17.2% delay percentage during the same period in 2019.
Subpar airline operations have drawn a drumbeat of negative headlines over the summer, putting carriers on the defensive.
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Airlines for America, which represents the major U.S. carriers, didn’t immediately respond to a request for comment about the union campaign.
In an earnings call last month, Delta CEO Ed Bastian signaled an openness to resuming buybacks after the restrictions lifts, though he steered clear of making any commitment to do so.
“We talk over the long term that we’ve got a responsibility to all constituencies — to our customers, to our employees, and importantly to our owners as well as our communities,” Bastian said in response to a question about whether Delta is considering stock buybacks to bolster its share price. “And our owners shouldn’t be forgotten about, and we didn’t forget about them during the pandemic.”
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