American Airlines announced that it will furlough about 25,000 front-line employees this fall as surges in coronavirus cases continue to paralyze travel demand.
According to American Airlines, the furlough notices for their employees, who make up 29% of its US mainline workforce, will be sent soon as the company aims to slash the workforce by October.
The airline asked its employees to apply for new extended leaves that can last up to two years or early retirement packages. This way, they will get more people off payroll as possible before being forced to involuntarily strike out their jobs.
The revenue of American Airlines in June was declined by over 80% than a year ago, CEO Doug Parker and President Robert Isom said in a note to staff.
“And with infection rates increasing and several states reestablishing quarantine restrictions, demand for air travel is slowing again,” they wrote.
Meanwhile, an average of about 672,000 people a day passed through Transportation Security Administration checkpoints in the first two weeks of July. This is a 73% decline from the same period a year ago.
Under the terms of $25 billion in federal payroll support, airlines could not slash jobs or pay rates of workers through September 30. Parker and Isom expressed support for the extension of aid through the end of March 2021, which was proposed by lawmakers and unions.
According to the Worker Adjustment and Retraining Notification Act, companies must notify staff about potential layoffs or temporary furloughs 60 days in advance.
With this, the American Airlines will send WARN notices to 37% of its flight attendants, or 9,950 people and to 2,500 of its pilots, or 18%; 3,200 maintenance workers; and 4,500 fleet service employees, among others.
Unions’ reactions
“This is brutal news,” said Dennis Tajer, spokesman for the Allied Pilots Association, which represents some 15,000 American Airlines pilots. He said that slashing jobs to pilot ranks could affect the airline’s chances of returning to a rebound in demand “when we get on the other side of this crisis.” The union is requesting for the expansion of early retirement packages to more pilots.
Julie Hedrick, president of the Association of Professional Flight Attendants, the union that represents the cabin crew of American Airlines, said the union is calling for the extension of payroll support from the Congress and the Trump administration. The extension will “help keep aviation front-line workers connected to their pay and benefits as we deal with reduced demand as a result of the pandemic.”
American Airlines announced this month that it has around 20,000 more employees than it needs for its limited fall schedule.
Other airlines
United Airlines last week said that up to 36,000 employees or 40% of its workforce could be furloughed while Southwest Airlines told its employees that the carrier needs the number of passengers to increase thrice by the end of the year to elude layoffs or furloughs.
Meanwhile, Delta Air Lines on Tuesday announced that some 17,000 employees have volunteered to resign from the company and that it does not want involuntary furloughs comes the expiration of the federal aid terms. American Airlines’ shares dropped by about 3% in postmarket trading.
