Airline workers struggle with voluntary separation leave

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A Delta Air Lines employee helps a customer at a deserted Los Angeles international airport on April 16, 2020 in Los Angeles, California.David McNew | Getty Images

Thousands of American airline employees are forced to gamble with their careers.Airline leaders urge employees – from flight attendants to mechanics to marketing managers – to consider voluntary departure or early retirement packages, an effort to cut spending after the drop in demand for air travel this year , reaching the lowest levels since the 1950s in April. Labor is generally the biggest cost for airlines, and the ranks of US passenger carriers have grown 20% in the past decade to 459,000 people, federal data shows.

I’m not ready to say goodbye to my career, “said a Newark, New Jersey-based stewardess at United Airlines, who said she had not taken any of the voluntary options.

Airline CEOs have warned that they expect to operate smaller airlines, which will require fewer employees, and have said they want to avoid unintentional reductions such as vacation and layoffs. The industry is losing money for the first time in years due to the coronavirus pandemic.

New United CEO Scott Kirby, who took the reins in May, said last month that he wanted to work with unions to help reduce airline labor costs to prevent leave.

“If we can keep them out of the way while we are going through the crisis, then when there is a recovery, and there will be a recovery … we can come back quickly,” he said.

The Southwest, for its part, is trying to avoid its first departures and layoffs during its 49-year flight, through takeovers and other voluntary measures.

Hurry up

The clock is turning. Terms of a $ 25 billion federal aid package prohibit airlines from laying off or cutting employee pay rates until October 1, and some airlines are giving away their base workers until this month here to decide to take a buyout. Otherwise, workers will have to see if their jobs will be cut this fall after the end of the aid conditions.

Airlines have parked hundreds of planes and cut schedules to cut costs. Travel demand has started to rise in recent weeks as states lift orders for on-site shelters to stop the spread of the virus and the peak of the spring and summer travel season begins, but remains below one fifth of last year’s levels.

Airline chiefs recently said they do not anticipate a rapid return in demand to what they enjoyed last year when US carriers stole a record 946 million passengers, according to the Department of Transportation. Transport.

Hold on

Some airline employees, speaking on condition of anonymity because of fear of jeopardizing their jobs, said voluntary separation or similar packages were difficult to sell.

Since the entire airline industry is affected by the pandemic, they cannot leave and leave for another carrier, and unemployment, although it improved last month, is still high in the United States Plus, seniority is a mainstay of frontline aviation workers like pilots and flight attendants, so even if they could find another job, to start again elsewhere would mean giving up the advantages of the years worked, such as the destinations and the timetables of choice.

“I thought it was better to be an active employee than not to be… and I felt that I had a little more control over my income with my business rather than with unemployment insurance”, said a United flight attendant for over 30 years. who decided not to take any of the voluntary options.

United, Delta, American and Southwest have offered these voluntary separation packages to at least some of their employees. During the winter, as the coronavirus began to spread in the United States, the airlines also offered temporary leave, partially paid or unpaid in their initial effort to cut costs. Over 120,000 people have volunteered, some from holidays across the United States, Delta and United, more than 30% of their employees.

“Another storm”

“This is the job in which I will retire,” said a Seattle-based Alaska Airlines flight attendant. “This is just one more storm that we have to face. She said she volunteered for a month of unpaid leave because she had a two-income household.

“There is an overwhelming feeling that departures are inevitable and maybe my month off can save a job on the road,” she said. “It can even save my own work. ”

An American Airlines flight attendant based in Miami for six years said he would not take any of the voluntary options.

“I’m going to be really honest, my answer is a flat no,” he said. “As much as we talk about it, we absolutely love this job. ”

Permanent separation packages vary, but airlines offer years of continuous free flights, depending on the availability of open seats and health care coverage. Southwest, for example, offers severance pay based on years worked, one year of company paid health care and four years of travel privileges, for those who raised their hands to leave voluntarily.

Employees who have worked at the Dallas-based airline for a decade or more are entitled to 12 months’ wages, “in recognition of their service to Southwest Airlines,” a spokesperson said, adding that the programs “are the The most generous packages ever offered in Southwest history will help match staffing levels to the current drop in demand due to COVID-19. ”

Weighing the risks

Some employees don’t want to try their luck.

“I took it because if I’m realistic, I don’t think a lot of people are going to (or want to) take voluntary leave,” said a director of American Airlines, who volunteered for a buyout . “The risk ratio is far too high. ”

American plans to cut executive and administrative workers by approximately 30%, a percentage similar to what United is targeting, and equates to a reduction of approximately 5,000 jobs.

Fort Worth, Texas-based airline offers up to 10 years of travel benefits and one-third salary until September 30, or five years of travel for one-third salary until December and has warned employees last month that there would be no severance pay if they were laid off. These workers will have until Wednesday to apply. The carrier recently described severance packages for high-level employees, according to people familiar with the subject.

The United States and United are reducing their number of officer positions and reorganizing their senior ranks.

“Attractive to someone”

Delta, the least unionized of the major airlines, has negotiated early retirement and other options with the union representing its more than 13,000 pilots. The union lobbied for reduced leave to save money, but did not reach an agreement with the company in early June.

“We are entering the final innings of the game,” said Chris Riggins, Delta pilot and spokesperson for the Atlanta Line section of the Air Line Pilots Association.

Unlike previous downturns, companies like airlines are using a variety of measures to cut labor costs, rather than just layoffs, said Tom McMullen, senior partner at Korn Ferry.

“Depending on where you are in your life or career, it is probably attractive to someone who is near retirement,” he said.

“We will have to make sure that we resize our business accordingly,” said US CEO Doug Parker during an investor webcast on May 27 on potential reductions at the expiration of federal aid conditions. . “So we’re going to try to do it in a way that hopefully won’t even be necessary for anyone. ”

Although airlines cannot fire or fire workers until October 1, employees can be notified in the summer of the reductions.

Airlines are not the only aviation companies to suffer from the coronavirus toll when traveling. Boeing cuts 10% of its 160,000 employees and, in addition to offering buyouts and other options, announced initial layoffs of nearly 7,000 people last month as it faces a dismal market for new planes. General Electric, which manufactures engines for Boeing and Airbus, cuts about 25%, or about 13,000 jobs, from its aeronautical unit.

Belt tightening

Some airline workers say they adjust their expenses to prepare for the worst and begin to think of emergency plans such as other work areas or to move to other cities.

“My plan is to save, save, save,” said the six-year-old American Airlines stewardess.

A four-year-old Delta driver said he is giving up on a vacation in the Middle East, abandoning plans to build a patio for his house and painting for his vintage Volkswagen camper van.

Almost three decades United employee who works in the union representing customer service and fleet employees looked back at other times of upheaval in the industry: September 11, 2001, terrorist attacks , a wave of bankruptcies and mergers, and the Great Recession.

“This is the first time I have really been afraid of what our future will be like,” she said.

She said she had no plans to apply for a voluntary separation package, but said that she and her husband, another United employee, had discussed whether he should move if he got a station at another base. One consideration is their lower secondary school age child.

“Are we going as a group? To separate? Are you trying to commute? It is a very big decision, “she said. “This is the first time he and I have had to watch this. “

Pay rate controversy

While the $ 25 billion earmarked for American airlines under the $ 2.2 trillion CARES law passed by Congress in March does not allow airlines to extend, terminate, or reduce pay rates of their employees, carriers like Delta, United and JetBlue have reduced the number of hour workers, which means smaller paychecks as flights and revenues have declined.

The practice has caught the attention of Democratic lawmakers and at least one Republican senator who argue that it violates the spirit of the law.

A group of Democratic senators, including Senator Elizabeth Warren, D-Mass., Asked Secretary of the Treasury Steven Mnuchin to clarify that they could not do this. Warren and several other Democratic lawmakers have written to the CEOs of Delta and JetBlue, who are generally not unionized and can therefore more easily reduce hours, in response to the reduction in hours. Delta has cut most workers’ schedules by 25%. The Treasury Department declined to comment.

“Not only was there little work to do, but it was dangerous to keep Delta employees unnecessarily in large public spaces during a raging pandemic,” said Delta CEO Ed Bastian in a letter to Warren. “The lack of travel resulting from government mandates and health advisories has also resulted in reduced hours for our pilots and flight attendants. In accordance with CARES requirements, Delta employees continue to be compensated at the same rate of pay. “

“The best concert in the world”

Employees of the airline, CNBC, said they did not expect federal aid to save their jobs if travel demand did not pick up.

While they were on the lookout for the future, everyone shared how much they loved their work, saying how different each day was and of course, the benefits: free flights around the world and the joys of take the plane anytime for fun or enjoying a long layover in another city.

” South Africa. I love Brazil. Latvia, “said the first Delta officer, listing some of his favorite destinations he has visited because of his job, adding that his wife often joins him on trips.

“This is still the best concert in the world,” said United flight attendant for 30 years. “My first stop and my most beautiful stop was Rome. ”

The worst of the demand crisis seems to be behind US airlines as signs of a renewed appetite for travel emerge and airlines add more service for the summer.

More than 2.5 million people passed through US airport checkpoints in the first seven days of June, according to the Transportation Security Administration. This is more than 85% below the same period, but more than double the number during the same period in May and more than triple the number during the first seven days of April.

Longtime United flight attendant said, “I hope the best because that’s what you do. “

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