American Airlines to Furlough 19,000 Employees unless Congress Helps
American Airlines announced that it will be forced to furlough over 19,000 employees on Oct. 1 unless Congress takes action to help the airline industry. The Fort Worth, Texas-based airline is the largest in the world with over 133,700 employees heading into this year.
While another almost 24,000 employees have already taken retirement buyouts and voluntary separations, according to CNN, the company will need to reduce their staff by at least another 40,000 employees to stay afloat.
credit: Quintin Gellar
Reuters.com states that these cuts “comprise of 17,500 furloughs of union workers -including 1,600 pilots and 8,100 flight attendants – and 1,500 management positions.”
The CARES Act, which provided $50 billion worth of help for the airlines, did not allow the companies to lay-off or involuntarily furlough any staff members until October. With that deadline quickly approaching, American has become more fearful for the future of the company.
A letter warning of the impending lay-offs was sent on Aug. 25 to over 17,500 American Airlines employees, reported CNN.
“The only problem with the legislation is that when it was enacted in March, it was assumed that by September 30, the virus would be under control and demand for air travel would have returned,” American CEO Doug Parker and President Robert Isom wrote in a letter sent to employees.
“That is obviously not the case. Based on current demand levels, we at American now plan to fly less than 50% of our airline in the fourth quarter, with long-haul international particularly reduced to only 25% of 2019 levels,” they added.
According to ABC News, “…other airlines are also announcing job cuts as air travel remains down around 70% compared with last year and experts predict it will not return to pre-pandemic levels until 2024.”
Earlier this summer, United Airlines announced that it would need to lay-off a total of 36,000 employees and sent furlough warning letters to 2250 of its pilots.
Earlier this week, Delta Air Lines also announced that just under 2000 of its pilots would be furloughed on October 1.
Aside from the furloughs, American will also suspend services to 15 small cities in October if their financial needs are not met.
Forbes.com reported that in order to avoid lay-offs and suspended flights, there will need to be an extension of the federal aid program.
Across the Airline industry, there will be well over 100,000 lay-offs without an extension of the CARES Act to include relief for the industry. This will mean these same unemployed individuals will add to already strained unemployment services in states across the country. Industry leaders and unions are urging Congress to take action and save these jobs before it’s too late.
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