Opinion:
Spirit’s Pilots Held Up Their End.
Now It’s Time for the Bondholders to Hold Up Theirs.
By ALPA President Jason Ambrosi
South Florida’s aviation workforce kept the planes flying to the very end. The bondholders who took over Spirit Airlines owe them the pay they earned.
When Spirit Airlines collapsed, it did not collapse quietly. It collapsed on the backs of roughly 2,000 professional pilots who did something remarkable: they stayed. They flew the final routes. They kept passengers moving, kept operations running, and honored their commitments, even as the company they worked for was being dismantled around them.
They stayed in part because they knew a “wind down fund” was established which would be utilized to cover pilot earned vacation pay, sick leave accruals, 401(k) contributions, and transition benefits. It was one of the reasons pilots made the decision to remain. This fund is now under the control of the same bondholders who have held Spirit airlines in an ever-tightening grip throughout the bankruptcy leading up to its eventual shutdown. The fund has more than enough to pay these hard-earned benefits to the pilots who stayed to the very last moment and, as a result, have helped the bondholders recover as much of their investments as possible.
And it was not the only sacrifice these pilots made. Spirit’s pilots gave up $85 million in pay and retirement concessions during restructuring, because they believed in the process and in the commitments made to them. They did their part. The fund that exists today, in part, because of them. However, now those payments have stopped. The understanding has been quietly abandoned; it is now being walked back by the same entities who asked them to stay. And the pilots are left to absorb the gap.
Let me be specific about what that gap looks like for a family. When the income stops, the bills don’t. Rent. Mortgage. Groceries. Healthcare. All of it keeps coming while the job search clock runs. And for a commercial airline, that clock runs long. Even after a pilot receives a job offer from a major U.S. airline carrier, it can take up to nine months to get a start date. One Spirit pilot now interviewing at a mainline carrier is looking at a 57 percent pay cut. He was nearing the end of his career. Now he and his family are hitting a harsh reset.
Airline pilots overwhelmingly operate as single-income households – one parent flying, the other at home managing the family and schedules that don’t bend. In Florida, a Spirit pilot family going through the devastating loss of employment is now facing a state unemployment benefit of $275 per week. That is not a bridge. It is barely a foothold. And the financial gap between what was owed to these families and what they are actually living on right now sits squarely on the bondholders’ shoulders.
These pilots aren’t asking for a bailout. They’re asking to be paid what they earned. Vacation time they accrued. Sick leave they built up and is owed to them under their pilot contract. Transition pay that was part of the understood basis for staying through the end. This isn’t charity. It’s making good on what is owed to the pilots.
And the entity that owes it isn’t some distant abstraction. Citadel, one of the most profitable hedge funds in the world, now headquartered here in Miami, is among the bondholder group controlling the wind down fund. Citadel, along with PIMCO, Cyrus, Western Asset Management, AllianceBernstein, Arena Capital Advisors, and Ares Management Corp., and others control that fund. The fund exists, in part, because these pilots stayed and kept operations running long enough to make the wind-down possible. The pilots earned that money. Citadel and its fellow bondholders are sitting on it.
South Florida has welcomed Citadel’s arrival. Mr. Ken Griffin, Citadel’s CEO, has spoken publicly about his commitment to this community - its business climate, its future. We take him at his word. And we’re asking him, and his fellow bondholders, to show it: release a portion of the fund and pay the pilots what they’re owed.
This isn’t complicated. It doesn’t require legislation or litigation. It requires a decision to do the right thing: Did the people who kept Spirit flying to the end deserve to be paid what they are owed or were they simply a convenience that expired the moment they were no longer useful?
At ALPA, we’ve seen what it looks like when companies stand behind their workforce. We’ve seen what it looks like when they don’t. The difference isn’t just financial. It determines whether the next generation of pilots can trust what they’re told when it matters most.
Spirit’s pilots held up their end. They flew. They stayed. They kept faith. It’s time for Citadel and its partners to do the same.
Jason Ambrosi is President of the Air Line Pilots Association, International (ALPA), the world’s largest pilot union in the U.S. and Canada.