Some 62 percent of votes were against ratifying the contract, with 95.1 percent of the union's members voting, according to a news release from the Southwest Airlines Pilots' Association.

Talks have dragged on for more than three years, and in November 2014 the U.S. National Mediation Board stepped in to oversee negotiations. In May, the union announced staffing and funding for a committee to prepare pilots for a strike in case a deal could not be reached.

Union President Paul Jackson said in the release that the deal included higher pay and some improvements to work rules.

However, he said, "there were new company allowances in this agreement that our pilots did not find palatable."

In a statement, Southwest said: "We must continue working (to) reach an agreement that meets the needs of our pilots and the company."

Southwest also said it expects mediated discussions to resume in the Spring of 2016.

(Reporting by Jeffrey Dastin in New York; editing by Alan Crosby)