Building on a Long-Standing Commitment to Pay Equity

Dec 27, 2022 11:30 AM ET
graphs showing 'pay gaps' for gender and race/ethnicity as of May 2022. No difference in POC vs White and .99$ to 1$ for female vs male

Originally published in American Airlines 2021 ESG Report

American has long championed pay equity, and we were proud to sign the White House Equal Pay Pledge in 2016. Since then, we have continued to refine our efforts to identify and close pay gaps based on gender, race and ethnicity. The 86% of our workforce that is covered by collective bargaining agreements has built-in pay equity as part of those agreements. Therefore, we have focused on pay equity for the remaining 14%, made up of management and support staff, who do not belong to unions.

After engaging a labor and economics firm to support our pay equity analysis, American began deploying Syndio’s workplace equity platform in 2020. Through Syndio’s guidance, we fine-tuned our methodology and successfully completed pay equity reviews through 2021. Our approach begins by placing team members in one of 50 “similarly situated groups” (SSGs) across American based on the type of work they do. We then identify factors that can impact compensation within each SSG, such as an individual’s seniority, experience or pay scale. Of course, higher salaries awarded to any new or existing team members can result in unintended pay gaps. By running a pay analysis at key points throughout the year, we can identify any drift in pay equity and address it. (See box above.)

In 2021, American also became the first airline — and one of only a handful of large U.S. companies — to receive Fair Pay Workplace’s inaugural pay equity certification. This Seattlebased nonprofit is working to dismantle pay disparities based on gender, race and ethnicity to create sustained fair pay. Our certification means that American has committed to apply valid methods for identifying pay equity issues and for implementing an ongoing remediation plan over time. As such, our rules and standards are available to the public.

The Fair Pay Workplace certification applies specifically to our management and support staff teams. Among our certification requirements, American will undergo regular check-ins that involve a seven-point review of our remediation plan. We have also pledged not to ask job candidates about their prior compensation or expectations for starting pay, which Fair Pay has identified as one of the largest sources of pay gaps.

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