United Airlines Warns It May Layoff Half of Its U.S. Staff, 36,000 Employees: 'A Last Resort'
Among the United employees at risk of being furloughed are some 15,000 flight attendants and 2,200 pilots
United Airlines has warned over 36,000 employees — nearly half of its U.S. staff — about potential furloughs to come in the fall, as the coronavirus pandemic continues to cripple the air travel industry.
"The reality is that United simply cannot continue at our current payroll level past October 1 in an environment where travel demand is so depressed,” the company said in a message to its staff obtained by PEOPLE. "After months of aggressive cost-cutting and proactive capital-raising, today we updated employees about a topic we’ve always dreaded and the action that was always a last resort in the context of this COVID-19 pandemic: involuntary furloughs."
The company said it will exhaust voluntary measures before cutting employees. And some of the furloughed staff may be called back to work, but that will depend on a return to demand.
Furlough warnings have reportedly gone out to some 15,000 flight attendants, more than half of the airline’s cabin crew, as well as more than 2,200 pilots, 4,500 mechanics and technicians, and more than 11,000 airport operations staff.
"The United Airlines projected furlough numbers are a gut punch, but they are also the most honest assessment we’ve seen on the state of the industry,” Sara Nelson, president of the Association of Flight Attendants, told CNBC.
Just one day prior to United's furlough memo, the company signed a letter of intent to accept government loans through the $2 trillion coronavirus economic relief package, also knows as the CARES Act. The statement detailed United has accepted a total of $9.5 billion through CARES.
Alaska Airlines, Delta Air Lines, JetBlue Airways, and Southwest Airlines also signed letters of intent. American, Frontier, Hawaiian, Sky West and Spirit airlines did so the week prior.
“These airlines are among the companies most heavily affected by the disruptions to social and economic activity caused by the pandemic,” Treasury Secretary Steven T. Mnuchin said in a statement, per the Post. “We look forward to working with the airlines to finalize agreements and provide the airlines the ability to access these loans if they so choose.”
Under the CARES Act, airlines were eligible to receive more than $50 billion in grants and loans. The $25 billion already granted was focused on keeping pilots, flight attendants, mechanics and other front-line workers on the job. Another $4 billion in grants was made available to cargo carriers.
In March, Sydney-based CAPA Centre for Aviation predicted that many airlines would have a hard time bouncing back financially amid the ongoing pandemic.
Emerging from the crisis will be like entering a brutal battlefield, littered with casualties,” CAPA said, warning that, “coordinated government and industry action is needed — now — if catastrophe is to be avoided.”
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