Airlines planning tens of thousands of layoffs as CARES Act deadline approaches

By Sam Mintz for POLITICO
08/25/2020 02:39 PM EDT

American Airlines on Tuesday said it will have to cut 19,000 employees after the end of September, pointing to the stark extent of the human fallout for the aviation sector if Congress doesn’t extend federal payroll support before it expires.

Airlines and their unions have been warning that they may have to cut tens of thousands of jobs when the CARES Act, H.R. 748 (116), expires at the end of September, but the exact scope hasn’t been clear because it wasn’t known how many people may retire or otherwise exit the industry beforehand. But on Tuesday, American said if Congress does not act to shore up the industry again, the job loss for that carrier alone will be 19,000.

“We have come to you many times throughout the pandemic, often with sobering updates on a world none of us could have imagined,” said American CEO Doug Parker in a note to staff announcing the cuts. “Today is the hardest message we have had to share so far — the announcement of involuntary staffing reductions effective Oct. 1.”

The scope: All told, the job cuts on Oct. 1 could easily top 50,000 across the industry. Delta Air Lines said earlier this week it is planning to furlough nearly 2,000 pilots when the aid runs out. United Airlines has warned it may have to reduce its staff by 36,000, although that number could be blunted by voluntary departures and early retirements.

Other airlines, including JetBlue and Southwest, have said they will try to avoid widespread involuntary cuts using extensive voluntary leave, time off or early out programs.

On the Hill: There is bipartisan support in Congress, as well as from the White House, for extending the payroll support program. Some 223 House members have signed on to support the concept, although no legislation has been introduced. Sixteen Republican senators and all Senate Democrats have also called for a “clean extension” of the program. And President Donald Trump also endorsed the idea earlier this month, saying “If they’re looking at that, whether they’re Republican or Democrat, I’d certainly be in favor.”

But time is extremely tight, and Congress does not return until Sept. 7, just three weeks before the deadline. Furthermore, it’s likely that talks over more aid for airlines would have to be wrapped up in the overall debate over another coronavirus package, which are completely stalled and did not look promising when lawmakers left town.

“Congress cannot wait to get this relief bill done. We need Leader McConnell at the table with Speaker Pelosi right now,” said Sara Nelson, president of the Association of Flight Attendants-CWA.

A spokesperson for Senate Majority Leader Mitch McConnell said he had nothing to share on the subject, and the office of House Speaker Nancy Pelosi did not immediately respond to a request for comment.

Like this article?

Share on Facebook
Share on Twitter
Share on Linkdin

Share This Post

Subscribe To Our Newsletter

Get updates and learn from the best

More To Explore