American, United go forward with job cuts as payroll support expires


American and United moved forward with a combined 32,000 furloughs and layoffs Thursday following the expiration of the $25 billion federal Payroll Support Program (PSP).

In Wednesday evening letters to employees, management from both carriers said that the furloughs will be reversed if Congress is able to reach agreement on a PSP extension over the next few days. Airlines and industry unions have lobbied for a second $25 billion to take them through March. The aid would come with the caveat that carriers continue to hold off on wage cuts or involuntary dismissals.

American CEO Doug Parker told employees that he spoke with treasury secretary Steve Mnuchin late Wednesday.

"He informed me that the White House and [House] speaker Nancy Pelosi are continuing to negotiate on a bipartisan Covid-19 relief package that would include an extension of the PSP, and it is possible they could reach an agreement in the coming days. There are also efforts in both the Senate and the House of Representatives to pass a standalone PSP extension if the broader relief package does not proceed."

United's furloughs include 6,900 flight attendants, 2,000 airport operations employees, 2,200 maintenance technicians and 1,400 management and administrative staff, among other cuts. A deal last week with the Air Line Pilots Association union has enabled United to avoid pilot furloughs.

• Related: Senate bill would help airlines avoid layoffs

American didn't provide as complete a breakdown Thursday morning, but its cuts include 8,100 furloughed flight attendants, 1,600 furloughed pilots and layoffs of 1,500 nonunion administrative staff. Including voluntary departures and leave, American now has approximately 100,000 active employees, compared with 140,000 before the pandemic.

Despite the expiration of the PSP, Delta and Southwest don't plan any furloughs until at least next year, with the possible exception next month of nearly 2,000 Delta pilots.

But some other U.S. carriers did make cuts now that the PSP program has expired.

Hawaiian Airlines went ahead with 466 furloughs on Thursday, including 157 flight attendants and 102 pilots.

Allegiant furloughed 100 of its pilots on Thursday after a plan to delay the action was rejected by the Teamsters union, which represents its pilots.

Alaska dealt full furloughs to 327 employees, including 299 flight attendants. Another 119 employees, including ramp workers and customer service agents, were furloughed to part-time status from full-time.

Along with involuntary cuts, more than 150,000 U.S. airline industry employees have accepted early retirement packages or voluntary leave.

Demand at U.S. airlines continue to lag approximately 70% behind last year.

UPDATE: This report was updated to include furlough announcements at Hawaiian Airlines, Allegiant and Alaska.


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