According to an announcement made by United Airlines on July 8, 2020, up to 36,000 employees may be furloughed after temporary agreements were struck with the pilots’ union. Up to half of the United workforce will be laid off while the novel coronavirus continues its global rampage. However, furloughing and laying off workers is forbidden for airlines that are recipients of a federal coronavirus stimulus package until September 30, and United falls into this category.
Airlines were among the most heavily affected industries due to air travel being a major avenue for the spread of the virus. In recent months, United Airlines, along with other major airlines like Delta, urged workers to retire early in order to cut losses, despite receiving a stimulus package. Such cost-cutting measures also include strengthening health safety protocols and reducing passenger capacity to comply with social distancing requirements.
According to a filing by the SEC, there has been a large dip in domestic flight bookings for United since June 16 as COVID-19 cases continue to spike. There was a 73 percent year-over-year decrease in bookings in most airports while those from Newark, New Jersey, had an even steeper 84 percent year-over-year dip.
Sara Nelson, president of the Association of Flight Attendants which represents workers at 19 different airlines (including United), commented: “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.” She called on Congress to help stave off “hundreds of thousands of layoffs from an industry that normally drives economic activity” by extending stimulus funding beyond the initial date.
However, despite the stark warning from United to its employees, the airline included in its memo that the warning won’t have to end up with definite layoffs. Also part of the memo is that there is a possibility of calling people back to work if there is a resurgence in the demand for global air travel.