United Airlines and American Airlines confirmed in statements today that the new government aid package would prevent the need to furlough staff in April. The US government passed a COVID-19 relief package which grants a further $14 billion to support major US airlines. Previous government loans which protected jobs were set to expire on March 31st.
A new aid package giving hope for thousands of employees
Thousands of airline employees have been waiting for April 1st, fearing they may be furloughed. The government aid package announced last year came with conditions that airlines that accepted the loans must use the money to guarantee staff jobs until March 31st. As a result, most of the major airlines sent out warning letters to staff stating that come April 1st, mass-furloughs were a possibility.
However, as the fateful day approaches, employees at both United and American Airlines can now breathe a little easier. In statements made today, both airlines confirmed that the new government aid package passed through Congress on Wednesday, meant furloughs would not happen. The government aid package is worth a massive $1.9 trillion with $14 million set aside for airlines, including the Payroll Support Program (PSP), to allow airlines to continue to pay employees.
NEW: American Airlines is telling 13,000 workers who received notices of April 1 furloughs “you can tear them up!” House passage of $1.9 trillion stimulus bill extends airline Payroll Support Program once again. pic.twitter.com/a23SkVfhwd
— Pete Muntean (@petemuntean) March 10, 2021
Matching statements
In a statement, Scott Kirby, CEO of United, said, “Thousands of frontline workers will now receive paychecks and healthcare through September, which is especially critical while vaccine distribution continues to ramp up.” United had sent warnings to around 14,000 workers.
In a similar joint statement, Doug Parker, CEO of American, and Robert Isom, President of American, said, “For our 13,000 colleagues who received Worker Adjustment and Retraining Notification (WARN) notices last month, those are happily canceled – you can tear them up!”
Both airlines also placed a strong focus on the continued effort to vaccinate as many Americans as possible. American recently offered an incentive package to encourage American Airlines employees to get vaccinated, and United’s statement also encourages workers to get vaccinated at Chicago O’Hare airport.
Now United Airlines says 14,000 workers WILL NOT BE FURLOUGHED April 1 thanks to the House passing Covid relief. $14 billion going to airlines.
CEO Scott Kirby: “Thousands of frontline workers will now receive paychecks and healthcare through September.” pic.twitter.com/v0kGxNGzrI
— Pete Muntean (@petemuntean) March 10, 2021
Is this loan enough?
The new government support package runs until September 31st giving airlines a few months to position for recovery. With vaccine roll-outs continue across the US and globally, the summer months are looking promising for airlines. The focus on vaccines in both statements shows that US airlines are placing a lot of hope that vaccines will allow airlines to recover.
Although there haven’t yet been any announcements from other US airlines, similar statements will likely be released soon. The new loans have come with old conditions, so any airline that accepts the loan cannot furlough staff until October.
In addition to United and American, Southwest had sent WARN notices to almost 7,000 employees, and Delta Air Lines confirmed 2,500 pilots were at risk. In total, US airlines had placed over 75,000 people at risk of furlough. By the end of September, airlines will hopefully have increased revenues enough to retain staff.
What do you think of the US government’s new aid package? Let us know your thoughts in the comments.
