US airlines to lay off 32,000 workers as aid program expires

NEW YORK: American and United airlines have announced to begin furloughing 19,000 and 13,000 workers respectively as US officials have failed to reach a deal on fresh aid to the pandemic-hit air travel sector.

The first day of October concludes the period when US carriers that received billions in aid from Congress promised to stop laying off workers.

A package of loans totaling up to $25 billion to seven US carriers by the Treasury Department provides funds for airlines to ride out a prolonged downturn amid the coronavirus.

US Treasury Secretary Steven Mnuchin said he was hopeful airlines would postpone layoffs if congressional leaders can reach a framework for a deal.

“Tomorrow, tens of thousands of essential aviation workers will wake up without a job or healthcare and tens of thousands more will be without a paycheck,” Sara Nelson, president of the AFA-CWA flight attendant union, said in a statement.

Since the coronavirus intensified in March, US airlines have been grounding planes and delaying jet deliveries to limit their cash-burn as air travel remains at about only one-third of its level a year ago.

Many airline carriers have struck agreements with unions to spread out work among employees. Tens of thousands of employees have also accepted unpaid leave or early retirement packages to avert the need for involuntary terminations.

Airlines have said they do not expect a full recovery until a vaccine is widely available. Unions have said 100,000 people or more could be laid off without additional federal aid.

United Airlines on Monday reached an agreement with its pilot’s union to avert furloughs of 2,850 employees. Flight attendants and staff in other airport operations are among the 13,000 being laid off.

Southwest Airlines has said it does not plan involuntary job cuts. The Delta Airlines pilot union last week said it reached an agreement with the company to avoid furloughs until at least November 1.

Delta has said earlier voluntary staff departures and union agreements averted the need for involuntary job cuts for flight attendants and other frontline employees.

Laid-off workers had been receiving $600 in weekly supplemental unemployment benefits under a provision of the CARES Act that expired at the end of July.

President Donald Trump authorised an additional $300 in weekly spending by tapping federal emergency funds but those funds are also running out and are expected to be gone in October.

The most recent version of the proposed ‘Heroes Act’ includes more than $400 billion in funding for state and local governments. The Economic Policy Institute has estimated that failure to provide support to local government could cost 5.3 million jobs through 2021.