By Rajesh Kumar Singh

CHICAGO (Reuters) -Pilots at JetBlue Airways (NASDAQ:) Corp have overwhelmingly accredited a two-year contract extension, their union mentioned on Monday.

The Air Line Pilots Affiliation (ALPA), which represents greater than 4,600 pilots at JetBlue, mentioned 75% of the pilots voted in favor of ratifying the settlement, which supplies for a compensation enhance of 21.5% over 18 months in addition to different financial enhancements.

The deal, efficient Feb. 1, is additional proof of the bargaining energy pilots are having fun with as carriers employees as much as meet booming journey demand.

Analysts at Jefferies estimated that the US is in need of 10,000 pilots. This scarcity is projected to final till 2027.

JetBlue deal features a market price adjustment provision to make sure the pay charges for its pilots align with future contracts at massive nationwide carriers. Pilots would additionally get a one-time cost as much as $17,000.

In all, the settlement is estimated to end in a acquire of $675 million over two years for JetBlue pilots.

In July, JetBlue agreed to purchase Spirit Airways (NYSE:) in a $3.8 billion deal, which is predicted to shut no later than the primary half of 2024. Whereas Spirit’s shareholders have accredited the merger, the destiny of the deal hinges on securing regulatory approvals.

After the Spirit deal, the New York-based provider and its pilots entered into negotiations for a short-term contract extension.

ALPA mentioned the settlement has put JetBlue pilots in a “sturdy place” for future negotiations.

“As JetBlue pursues this merger, this settlement protects the profession expectations of JetBlue pilots whereas the marketplace for pilots rises,” mentioned Chris Kenney, chair of ALPA’s JetBlue unit.

ALPA has additionally secured as a lot as a 43% cumulative weighted common pay increase for Spirit pilots in a brand new contract.