Aviation industry workers hold signs during a protest in the Federal Plaza in Chicago, Illinois on September 9, 2020.
Kamil Krzaczynski | AFP | Getty Images
U.S. airlines have begun the complicated process of recalling 32,000 workers they took on leave this fall. This is a condition airlines must meet in order to receive additional $ 15 billion payroll support.
Aid, included in the $ 900 billion coronavirus relief package that Congress passed Monday night, also requires airlines to agree to keep employees on payroll and restore certain routes through March. The process is ongoing despite President Donald Trump not yet signing the Coronavirus Relief Act. In a surprise request late Tuesday, he urged lawmakers to increase direct payments to families and individuals.
In order to bring back more than 32,000 workers on leave, including flight attendants, pilots and mechanics, it is necessary to restore safety clearances and ensure that returning workers are up to date on federally mandated training. Airlines also need to unravel some vacation reduction programs, such as: B. no guaranteed payment offered in exchange for maintaining medical services. The bill stipulates that airlines must make a repayment from December 1, prohibits dividend payments and caps.
Aviation job cuts, mostly at American Airlines and United Airlines, began this fall after the terms of the last $ 25 billion package, grants and loans expired on September 30th. Delta and Southwest Airlines employees were able to take tens of thousands of vacations this year from workers taking takeovers, early retirement packages, and temporary vacations. However, earlier this month, Southwest warned nearly 7,000 employees that they could be on leave in March or April if the unions don’t agree to pay cuts and other concessions, and Delta urged more volunteers to take unpaid time off to further the costs to lower. The aid will at least temporarily suspend an agreement with the airline’s pilots on wage cuts in exchange for lost vacation.
The unions have been calling for additional help from lawmakers since June and were later supported by airline executives as a significant recovery in demand for travel failed to materialize. Congress and the White House were unable to reach an agreement by the deadline, and vacation days began on October 1, bringing U.S. airline employment to its lowest level since 1986.
“We have taken steps to expedite payments to all team members on leave,” said Doug Parker, CEO of American Airlines, and Robert Isom, President Robert Isom, in a memo Tuesday, adding that the funds were due on Thursday Accounts should appear. The United States employed 19,000 people, including nearly 8,000 flight attendants and more than 1,200 pilots. More than 900 other pilots keep their medical services but receive no payment unless they can pick up trips.
Airlines are usually reluctant to take pilots off because retraining is costly. Without flying, you could lose money on your plane and the clock is ticking.
“Fortunately, the concrete wasn’t set,” said Dennis Tajer, a Boeing 737 captain and spokesman for the Allied Pilots Association, which represents the 15,000 American pilots.
The employees are brought back to work in phases.
“We expect to get the employees back to work in April and in the course of 2021,” said a statement to the employees of Kimball Stone, senior vice president of flight operations at American Airlines.
The extra help doesn’t mean the airlines or their employees are on solid foundations. A recovery in travel costs is not expected until the vaccine is generally available. As a result, employees are likely to be called back “temporarily,” United CEO Scott Kirby and Brett Hart warned in a notice to workers before the stimulus bill was passed.
“This is certainly good news for our economy, our industry and our airline – but it is especially good news for those who haven’t had a paycheck, and we can’t wait to see them back,” the note read.
However, United executives warned they wouldn’t expect any travel recovery until the second quarter.
“The truth is, we just don’t see anything in the data, which shows a huge difference in bookings over the next several months,” they wrote. “So we expect the recall to be temporary.”
Sara Nelson, president of the Association of Professional Flight Attendants-CWA, which represents 50,000 flight attendants and played a pivotal role in gathering workers and airlines for additional assistance, described United executives’ comments as “inappropriate”.
“Let’s be clear: the law doesn’t say ‘temporary’ hiring. It says you have to hire anyone who is a permanent employee,” Nelson said Monday night in an interview with CNBC’s The News with Shepherd Smith.
U.S. airlines are losing more than $ 180 million daily in December, and their pre-tax losses exceeded $ 36 billion by September, according to the Airlines for America trading group.
Successful trials of coronavirus vaccines sparked a rally in airline stocks in hopes the public will want to travel again soon. In the current quarter, American stocks are up 29%, United’s 27%, Delta 32% and Southwest’s 25%. The airlines even referred to their role in getting the vaccine in their pitch to lawmakers for additional help.
Despite initial excitement about the Pfizer-BioNTech and Moderna vaccines, gains have declined as coronavirus cases have increased.
Airlines saw a slowdown in bookings and weaker than expected revenue towards the end of the year. A highly contagious load identified in the UK has sparked a wave of new travel restrictions from more than two dozen countries. Delta, Virgin Atlantic and British Airways – at the request of New York Governor Andrew Cuomo on Monday – said they would start requiring negative Covid tests for passengers to board flights to Kennedy Airport.