United Airlines Warns 36,000 Employees Of Possible Furloughs, Layoffs This Fall
(CNN) -- United Airlines is warning nearly half of its frontline workforce that they could be furloughed this Fall. The world's third-largest airline says 36,000 workers — including 15,000 flight attendants, 11,000 customer service and gate agents, 5,550 maintenance employees and 2,250 pilots — will receive layoff notices.
The Wednesday announcement paints a grim picture for an air travel recovery only days after United announced it would ramp up its schedule in August. But as the pandemic worsens in some areas of the United States, bookings have once again started to tumble.
United has warned for months that it would cut thousands of jobs if travel does not pick up before October. So far, airline workers have been largely insulated from the job losses that have rankled other industries. The federal CARES ACT, enacted in April, offered billions of dollars in bailout funds to the industry and barred companies that took the money from cutting jobs or pay rates and involuntarily furloughing workings. But that prohibition lifts on October 1.
Notices were sent to employees Wednesday because federal law requires employers to notify workers 60 days before a mass layoff.
The airline is operating only a quarter of flights compared to last year, a company executive said Wednesday, and its flights are, on average, 55% full.
"Involuntary furloughs that we worked so hard to avoid are now the last option left," the executive said.
The president of the Association of Flight Attendants-CWA, which represents 50,000 flight attendants at airlines including United, called the furloughs a "gut punch." But, "they are also the most honest assessment we've seen on the state of the industry," the union president, Sara Nelson, said in a statement.
"This crisis dwarfs all others in aviation history and there's no end in sight," Nelson said.
United insists it's done everything it can to avert layoffs. Tens of thousands of employees took voluntary unpaid leave as the company began urging workers to do so.
Last month, the company mortgaged its frquent flier program for a bank loan, and at the time, the company said between that money and the CARES ACT funds it would have $17 billion in cash on hand by the end of September, roughly three times the normal cash it carries.
But the airline is still hemorrhaging $40 million each day.
Cuts are "now the last option left to protect the long-term interest of the company and long term prospects of" employees who will remain with company, the United executive said Wednesday.
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