On Wednesday, American Airlines said that when a U.S. assistance package for airline workers expires on April 1, some 13,000 employees are at risk of furlough, blaming slow vaccine rollouts and new international travel restrictions for dampening demand.
“We are nearly five weeks into 2021, and unfortunately, we find ourselves in a situation similar to much of 2020,”We are almost five weeks into 2021, and unfortunately, we are in a situation similar to much of 2020.
When a previous round of government payroll assistance ended on Oct. 1, Fort Worth, Texas-based American furloughed 19,000 employees but recalled them in December after a new $15 billion for the industry through March.
In order to protect jobs over the summer, aviation unions are now calling for another $15 billion in U.S. payroll assistance.
“The vaccine is not being distributed as quickly as any of us believed, and new restrictions on international travel that require customers to have a negative COVID-19 test have dampened demand,” American said, adding that the company would not fly all of its aircraft as scheduled this summer.
Fresh furlough notices have been sent to 14,000 employees by United Airlines, while Delta Air Lines Inc and Southwest Airlines Co have avoided layoffs mainly by voluntary leave schemes.
The year before, American and United both proposed voluntary arrangements to minimise staffing, but were still required to furlough. American said it was introducing a new round of exit packages, similar to United’s plans, in an attempt to reduce possible forced furloughs. They are mandated by statute, usually within 60 days, to warn workers whose jobs are at risk.
The possible furloughs for America include 1,850 pilots and 4,245 flight attendants. Late last year, United’s pilots accepted an agreement to avoid furloughs until June.
Last month, as with ultra-low-cost carriers like Allegiant and privately held Frontier Airlines, American’s wholly owned regional subsidiary, PSA Airlines, said it intended to restart pilot hiring this year.
The Allied Pilots Union, representing American pilots, said that management decisions and their handling of the balance sheet of the airline “have placed American in a more precarious situation than our competitors.”
Of the big U.S. carriers, American is the most leveraged. After a post on Reddit’s WallStreetBets website, it took advantage of a dramatic increase in shares last week to launch a new $1 billion stock sale to raise liquidity.
