- American Airlines and United Airlines are warning thousands of workers to prepare for the license in April.
- Executives are blaming the lack of demand on new travel restrictions and a slow release of vaccines.
- Hawaiian Airlines also informed labor authorities that more than 800 employees can be made redundant.
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Two of the country’s largest airlines are gearing up for another round of licenses in April, as the Payroll Support Program is about to expire and travel shows no sign of significant improvement before spring.
United Airlines and American Airlines, unsurprisingly, said about 13,000 of their employees will be laid off in April, as external factors continue to hamper the slow aviation recovery. In a letter to employees, American executives cited new restrictions on international travel that require a negative COVID-19 test to enter the country and a slow implementation of the vaccine as major concerns.
“The vaccine is not being distributed as quickly as any of us believed, and new restrictions on international travel that require customers to have a negative COVID-19 test have lowered demand,” Doug Parker, American CEO, and Robert Isom, American president said in the letter.
Parker and Isom said they initially thought that licenses would not be necessary, as the emergency authorization of two coronavirus vaccines and the pent-up demand for travel would increase summer bookings.
“As we ended last year with the successful extension of the Payroll Support Program (PSP), we fully believe that we would have a summer schedule in which we would fly all of our planes and would need the full strength of our team,” Parker and Isom said. “Unfortunately, that is no longer the case.”
At American, flight attendants will be the most affected with 4,245 of the approximately 13,000 notices planned to be sent to this working group as of February 3. Fleet service workers – including baggage handlers – and pilots are the next to be impacted with 3,145 and 1,850 notices, respectively, being issued to these working groups.
At the Capitol, airline unions are already lobbying Congress to extend the Payroll Support Program to avoid the impending license round scheduled to take place on April 1, the industry’s new judgment day. Sara Nelson, international president of the Association of Flight Attendants-CWA, testified before the Chamber’s Transportation and Infrastructure Commission on February 4 to present the business case to keep the program going.
“An extension of the PSP until September 30, 2021 will keep hundreds of thousands of airline workers up to date with safety certifications and permits that will be needed when more normal travel can be resumed,” said Nelson.
“We fully support the efforts of our union leaders to fight for an extension and we will lend our time and energy to support this effort in any way we can,” said Parker and Isom.
The most recent stimulus project approved in December 2020 provided $ 15 billion for airlines to bring back licensed workers, but executives said the recalls were unlikely to be permanent.
“The truth is that we just don’t see anything in the data that shows a big difference in reserves in the coming months,” wrote United CEO Scott Kirby and President Brett Hart in a letter to employees in December. “That’s why we expect the recall to be temporary.”
Just a month later, its forecasts proved to be accurate and the company plans to lay off some 14,000 employees after March 31, according to an internal memo viewed by CNBC.
“Despite continued efforts to distribute vaccines, customer demand has not changed much since we removed these employees,” the executives reportedly wrote in a January memo.
Hawaiian Airlines is also preparing for workers’ leave, although the airline has told labor officials in the 50th state that only about 800 will receive notifications. Travel to Hawaii has increased as the state has adopted a test strategy for visitors, but the airline says demand is not high enough to maintain its workforce.
The country’s airlines are suffering from historically low passenger numbers, despite a promising holiday travel season that saw millions fly into the sky in the days around Christmas and Thanksgiving. New statistics from the Transportation Security Administration also reveal that just three days in 2021 saw the number of daily passengers at US airports exceed one million.
If Congress passes another round of support, the cycle will only continue until demand increases, which could take months, as public health officials are warning even vaccinated Americans not to travel.
“Being vaccinated does not mean that I now have a free pass to travel,” said Dr. Anthony Fauci, director of the National Institute of Allergy and Infectious Diseases, at a CNN city hall.