On Wednesday, United Airlines held a press conference about the potential of forced unpaid leave of its 36 000 employees working in the United States. Conditions of Federal assistance in the amount of $25 billion. forbid companies to lay off workers until 1 October.
One of the largest in the U.S. and world airlines, United Airlines Holdings Inc. (UAL) warned Wednesday that can fire 36 000 employees since October 1, nearly half have flight attendants. In the company as at December employed approximately 96,000 people. This step United confirms the deplorable state of the industry caused by the impact of the pandemic COVID-19.
“None of the solutions that we have adopted until now, was not more difficult than the decision we are announcing today”, – said the representative of United Airlines during a press conference on Wednesday.
According to the official, the airline is still “loses $40 million every day”, undertaking a number of efforts to reduce costs and increase liquidity, but it does not compensate for the sharp decline in travel demand.
According to the airline, the warnings are sent to approximately 15,000 flight attendants and more than 2,200 pilots. The airline also said that more than 4,500 mechanics and technicians, and more than 11,000 employees of the airports will be notified with a warning of dismissal, change of payment or retraining.
US law requires employers to notify employees of possible layoffs or temporary furloughs for 60 days. United Airlines and other airlines that have received Federal support for salaries of $25 billion, it is forbidden to dismiss, to apply the unpaid leave or to reduce the salaries of staff until 1 October.
On Tuesday, the airline announced that in June, throughput dropped by about 88% compared to the same period last year, and in July and August is expected to decline by approximately 75% and 65%.
According to airlines filed applications with the SEC (the U.S. Commission for securities and exchanges), the number of bookings for domestic flights from 16 June again decreased significantly as the number of cases COVID-19 across the country is growing. According to the filings, booking of tickets with departure from Newark, new Jersey, declined by 84% compared to the previous year and 73% at other airports.
According to the representative of United Airlines, the company expects that most of its employees will be able to return to work “as the return of demand.” However, the airline believes that a significant return of demand will not come up until the market is released, an effective vaccine or treatment from COVID-19. Industry representatives say that the recovery “will take years”.
“We continue to offer a voluntary program (early retirement) and continue the reorganization of management and administration to align our labor costs with shared demand”, – said the representative of United Airlines in an interview with FOX Business on Tuesday.
The company works with different unions on ways to mitigate the final number of leaves. For example, flight attendants were offered two options for the voluntary leave, one of which lasts eight months until June 1, 2021, and another 13 months until November 1, 2021, during which they will receive benefits, according to internal documents of United Airlines, reviewed by Reuters.
Other U.S. airlines, Delta (DAL) and American Airlines (AAL) are also making efforts to minimize costs and consider layoffs of some staff.
“The projected number of layoffs United Airlines as a “punch in the stomach”, but they are the most honest assessment of the state of the industry that we saw,” said the President of the Association of flight attendants-CWA (AFA) Sarah Nelson.
“The fact remains – these are projected figures (United Airlines) exceed the total size of most major airlines ten years ago,” added Nelson.
