For the first time ever, cabin crew and ground staff at British Airways will receive a profit sharing bonus as part of a new three-year pay deal, which will see tens of thousands of employees at the airline receive a 10.5% pay rise over the course of the contract.
The pay deal was approved on Monday following a ballot in which more than 86% of workers voted in favor. The deal will take effect immediately, with employees set to receive a minimum profit sharing bonus of £1,000.
Profit sharing will be based on BA’s annual operating margin with a maximum bonus of 4% payable if British Airways achieves an operating margin of 15% or more. In the third quarter, the airline’s parent company, IAG, reported an operating margin for BA of more than 20%.
British Airways has become a key driver in IAG’s profits, although its operating margin is still behind the aggregated group-wide margin of 21.6% and trailing Vueling, which currently boasts an operating margin of 21.5%.
Until today, only senior managers and pilots at British Airways were able to share in the financial success of the airline through a profit sharing scheme. That has now been massively widened to include cabin crew, gate agents, engineers, call center staff, cargo handlers, and virtually every other front-line employee.
Workers are set to receive an immediate 4.5% pay rise following ratification of the pay deal, followed by a 3% rise in 2026 and the same in 2027. The deal is currently above inflation, but should the economy heat up significantly, the pay rise will automatically adjust to the rate of inflation.
British Airways has often had a pretty difficult relationship with front-line employees, and disputes over pay and conditions have been commonplace. In this case, however, peace should be guaranteed for at least the next three years, and there wasn’t a single threat of strike action.
Not all employees are, however, happy with the deal. Cabin crew who used to be part of the cheaper ‘Mixed Fleet’ group of employees employed on drastically lower wages than more veteran colleagues argue they deserve a much more significant pay rise to help match the salaries that senior crew members earn.
British Airways has, though, come a long way since 2017, when it was accused of forcing junior crew members to live on ‘poverty pay’ and stories of flight attendants having no option but to sleep in their cars because they couldn’t afford hotel rooms were commonplace.
BA’s new profit-sharing scheme still pales in comparison to the 10% bonus awarded by Delta Air Lines to most of its employees or even the 5.3% bonus paid by United Airlines to its flight attendants. At least, though, it’s better than the 1.1% profit-sharing bonuses announced by American Airlines and Southwest.
I’m glad BA is paying newer hires a living wage and while this is far from a vast raise it should certainly help. It would be interesting to see inflation adjusted median income for ground and flight crew from pre-Covid and now.
Assuming that profits continue at current levels then in 2028 their pay will be broadly the same as 2018… But in the intervening decade wages have been impossibly low.
Also notable that this does NOT apply to the LGW or LCY crews qho are still on poverty if not starvation wages….
Will this apply to th e BA subsidiaries at LGW & LCY?
Difficult to see how they woukd accept LHR colleagues getting a boost to their already better wages and terms… Ie Strikes on short /mid haul may be caused by this move if it’s not widely applied
BA has given Krudy share to front line employees before. It was called ShareSave and I still have the shares I was given when the bonus was paid out because BA made a profit