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Tue February 4, 2014
Alaska Air CEO: SeaTac Ordinance The Wrong Way To Tackle Income Inequality
Seattle-based Alaska Air Group, which has fought a local living-wage ordinance, concedes that low-wage workers may need a raise, but the company's CEO doesn't think SeaTac's initiative is the answer.
About 4,700 workers at Sea-Tac International Airport were hoping to get a bump to $15 an hour at the beginning of this year. But a judge has blocked that voter-passed ordinance from taking effect at the airport.
Alaska has led the legal fight to strike down the initiative, which Alaska Chief Executive Brad Tilden calls a "blunt instrument." Still, Tilden acknowledges there needs to be a debate about fairer wages.
"We certainly recognize the problem with income equality and we recognize the needs we have with training," Tilden said at a conference sponsored by the Pacific Northwest Aerospace Alliance. "We recognize, and this may or may not be controversial, minimum wage may need to be higher."
To hear more of what Tilden had to say about Proposition One, click here:
Tilden says Alaska faces tough competition. Delta Air Lines, a longtime partner of Alaska, recently turned up the pressure by adding flights on core Alaska Airlines routes to Las Vegas, Los Angeles and San Francisco.
"We’ve got threats to us right now to our independence to being a Seattle-based company," Tilden said. "So let’s do something that can help Seattle-based companies win."
Tilden says the problem is that if baggage handlers and other ground crew get a raise, Alaska may have to hike wages for everyone else.
"How many jobs have to be changed to sort of restore equity in the pay system?" Tilden said. "That was a super, super scary number for us."
The CEO says he’s proud of the company’s wages, which he says compare well with much bigger airlines. In the past year, Alaska has reached agreements with its unionized pilots and flight attendants.
The company outsourced baggage handling in 2005, and those workers are among the ones who were hoping to get a pay raise under SeaTac's Proposition 1. Last fall, Alaska amended its contract with its baggage handling contractor Menzies Aviation to lift the starting wage to $10.88 an hour from $9.50.
To hear more of what Tilden had to say in response to a question about Proposition 1, click here: