American Airlines Will Be Warning Employees Of Mass Furloughs

United Airlines made big news this week by announcing they could lay off as much as 39% of their employees (which some media exaggerated as half).

Now American Airlines is preparing to send out WARN Act notices, too according to the TWU-IAM association which represents mechanics and fleet service workers at the carrier.

American Airlines has informed the Association that it will be sending Worker Adjustment and Retraining Notifications (WARN Act notifications) to Association covered employees. This notice, which is required by law, will contain information indicating that American Airlines may furlough employees.

Like United, American is preparing for the eventuality that they’ll have to lay off large numbers of employees, and giving notice in order to comply with relevant laws. They don’t yet know how many employees that will be – American CEO told employees in a recorded discussion that they’re looking at having 10-20% too many pilots, and 20% – 30% too many flight attendants.

The number of actual layoffs will depend on how many employees take voluntary leaves and early retirements, and whether the recovery in travel is stalling, Airlines and their unions are looking for another payroll bailout, though this time the case is far weaker than the first time around – when it was at least plausible to claim that the pandemic would be over in six months, and air travel would be ready to bounce right back – because now it’s clear to the airlines themselves that there will be less demand for air travel and fewer flights for some time. That means employees need assistance transitioning to new careers. The economy suffers if that transition is delayed.


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About Gary Leff

Gary Leff is one of the foremost experts in the field of miles, points, and frequent business travel - a topic he has covered since 2002. Co-founder of frequent flyer community InsideFlyer.com, emcee of the Freddie Awards, and named one of the "World's Top Travel Experts" by Conde' Nast Traveler (2010-Present) Gary has been a guest on most major news media, profiled in several top print publications, and published broadly on the topic of consumer loyalty. More About Gary »

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Comments

  1. We never learn! Bailing out the S & L industry did not stop Enron and other stock manipulations.

    We need a coherent national industry plan emanating from the federal government that prevents the winks and backslaps initially allowed with the airlines; does not subsidize the stockholder or senior management. Importantly, this program will pay a meaningful stipend directly to individual employees. Unemployment in this market would be far worse and a certain fiasco.

    The funds should come from what we currently pour into foreign aid and the UN. Remember how we wasted over $400 million last year in the World Health Organization (WHO), when Red China paid a mere $42 million to control the Who and turn it against us to cover up the pandemic at a critical point.

    Perhaps our airlines can lean from how Amtrak successfully manipulates Congress by threatening to reduce schedule frequencies to trigger additional subsidies.

  2. Let’s hope the furloughed employees are the bottom performers with respect to customer service.

  3. Ah, more scare tactic posturing to get another fat check from the government before the election. How charming and ethical to soak the nation to benefit stockholders.

  4. @Emeral – Doug Parker has, for several years, taken all his compensation in stock. As he told AA employees the share price has fallen and that’s a cut!

  5. Gary, as an employee of one of AA’s wholely owned regionals, I hate seeing anyone lose their jobdue to furlough(I went through it with AWAC in 2011). I hope AA doesn’t need to furlough anyone, but I do know as both an employee and a shareholder, AA will get through this in one way or another.

  6. AA Management is already getting hit unfortunately not by performance but for how much they make. Or who likes who. They are replacing them not reducing. They got let go and walked out same day of notice in July and will get paid till September. Union members will get hit by seniority. Government thankfully kept us paid on the clock but once it runs out is game over.

  7. Not good enough! That doesn’t help my husband who just lost his job at AA along with so many others. They don’t deserve another cent of government bail out money!

  8. Doug Parker made 30 million dollars in 2018 his compensation since he took over CEO is over 100 million I would like his paycut

  9. I’ve been told Delta corporate employees have been told July 30 is the day when they find out if they stay or go.

    I’m honestly surprised Ed and gang hasn’t announced any changes to the director and above team yet. That group has ballooned in the past five years, where there’s 450+ people in that group now. If I were a Wall Street analyst, I’d be asking what the details on executive headcount reduction is during the upcoming quarterly call, especially since AA and UA have both announced some changes publicly. I can think of quite a few people in Delta management that have no place being there.

  10. The Airline load factors aren’t coming back for some time. Maybe not even next year ! So not sure what Union posturing can do at this point. Force Majeure will override any no layoff clauses. Let the games begin and get it over with. The truly sad thing is every sole hired after 9/11 could get furloughed if the target is 30%.

  11. While AA offers early retirements, those with years and years of service are handing in their badges and receiving absolutely no recognition/appreciation for their service. This is despite AA’s constant in-house propaganda claims of valuing employees. The truth always comes out in the wash.

  12. @Mark. We rarely give funds as foreign aid. We give the recipient bodies or countries ‘Credits’ that they can use to but US products. In the case of automobiles the vehicle has to be made in the US if it is a non-American auto company (Toyota for example) or made in the US or Canada if an American auto company (Ford for example)

  13. As far as I am concerned, the mechanics and flight service personnel at AA have made so many enemies of the public traveller that they deserve to all be sent home with nothing. My last two years of flying with AA were pure trauma with many delays, cancellations, lies, fees, and if you could get any service, it was abominable. I am plat pro, have a million miles, damn near lifetime gold, and AA is holding $3500 of my money and I would gladly give all of that up to see AA fold. Anything short of being forced to close down will not teach the management or the crew that they simply have to treat the customer better or this is the result. Wishing AA the worst.

  14. AA doesn’t have to cut that many jobs. Restrict the maximum amount of hours that you can fly to 70 (by contract I believe) and see how many run for the exits. Pay and benefits should be based on performance not how many years you’ve been there. The union needs to work with management and allow the bad flight attendants to get the boot instead of protecting them. I’m lifetime Platinum and have grown to detest flying AA. I’d rather drive 100 miles and fly BA than to take AA out of my own city. Take a short hop on Southwest and fly Qantas to Australia. Anything but AA!

  15. He is an idiot! All about himself and his 3500 dollars . Maybe he’ll loss his job

    mark johnson says:
    July 12, 2020 at 11:17 am
    As far as I am concerned, the mechanics and flight service personnel at AA have made so many enemies of the public traveller that they deserve to all be sent home with nothing. My last two years of flying with AA were pure trauma with many delays, cancellations, lies, fees, and if you could get any service, it was abominable. I am plat pro, have a million miles, damn near lifetime gold, and AA is holding $3500 of my money.

  16. What a hateful bitter man mark Johnson is….to wish such ill upon the majority of the worker bees at AA. There are a few bad apples, as there are in every single industry, but by it is terribly wrong to wish it on EVERYONE there.

  17. The problem M.s. lane is that there are more bad apples than good ones. A few bad apples will spoil the entire barrel and that is what is happening. The good ones left are so disgruntled by having to do the work of those that don’t want to do anything that they are adapting the same attitude. While I don’t wish ill will on anyone I am no longer willing to spend any more time and money with US based carriers when there are better options. Unions need to wake up and stop supporting those bad apples and let them get purged from the system or the US airlines are going to become even worse than they are now. Congress needs to allow foreign based carriers to compete in the domestic market so that prices come down and service goes up.

  18. @OneXMarine

    Fair enough – then let’s do that with any and all other industries. One of things that I don’t understand is how people fail to see that the foreign carriers that you applaud either have substantial government assistance/backing (Air France/KLM, Etihad, Qatar, Singapore, all Chinese carriers), a single or double hub fortress position in their home country (BA, Lufthansa, JAL/All Nippon, Korean, Cathay, Qantas), or have the ability/cultural expectation to hire and fire their cabin crew because they got married, or gained some weight (ME3, Asian carriers). In some cases, a carrier has all of the above. Service isn’t perfect by any means, and the unions really need to stop protecting bad performers, but it’s not near as simple as everyone here seems to lay out. People seems to want all of the benefit with none of the societal cost.

    The other thing – ‘prices go down’ – inflation adjusted prices haven’t gone up in 30 years. And not sure if there’s a full service airline in the world that’s made north of a 10% margin for a full-decade it’s history (maybe DL from 2010 – 20)

  19. Thank you BA.

    I am not certain which of your items are societal costs. But given that I will go out of my way to fly Cathay, ANA, JAL, Singapore, then supporting bad behavior at US airlines seems to be equally contributing to societal costs.

    Your point about the unions is spot on but it isn’t only about poor performers, the way that seniority counts when bidding for routes and cabins allows people who are no longer even physically able to provide the security and safety protocols in the event of an emergency and their attitude is that they don’t have to do anything once they have thrown that meal at you and dumped the ice cream sundae on your tray. Is it a societal cost to be able to fire or retire these people?

    this is why I see the complete collapse of AA as the only solution. Someone can buy the planes, hire qualified and enthusiastic employees, let the deadwood go wherever they have been the last 40 years and build a company based upon service. I don’t see any other way to get rid of the unions. Keep in mind that I certainly don’t exclude the mechanics from any of this. The overriding attitude among the workers is that it is them against the ‘suits’. Again, there is only one solution.

    Since I don’t care about my status anymore then there is really no downside to selling my miles and losing my aa account. I hope many people join me in that endeavor.

  20. Correct me if I’m wrong but haven’t the US carriers all been subsidized at one time or another? Didn’t they get billions after 9/11? The 08 financial crisis? And just recently? And the airline employees received pay protection through September where the PPP was for about 4 weeks. And the service isn’t even close to being acceptable in most cases, let alone perfect. Last November I spent nearly $11K for 2 round trip tickets to DOHA in business class. Flew AA to Dallas, (OK) BA to Heathrow (Good)and Doha (Very Good). Return BA went belly up and they put us on Qatar. Subsidized or not it was an incredible trip. Flew AA from Heathrow to DFW. A total disaster. The F/A spilled the cocktail first thing. Grabbed up everything except about 1/4 of what was left in the glass and took it away. Never said I’m sorry, never brought me anything else. Served dinner, never an offer of water, or wine, coffee, nothing. My wife (retired F/A) knew the F/A on the other aisle and he came and picked up my dinner service because the 2 F/A on my aisle was no where to be seen. My wife went up to the front and got me a bottle of water so that I would have something to drink. About 3/4’s of the way into the trip they realized that I was probably not happy and would be complaining to AA. So they all made multiple journeys across the aisle to talk to my wife and ask her to not let me write AA. Near the end of the trip the Purser must have heard about the poor service and came back and asked if there was anything she could do. Too little and way too late for that. AA from DFW home was good. Emailed AA and the first sentence was “I am not seeking compensation for my complaint.” With limited space I explained what happened. And a few hours later I get a canned response and 5,000 air miles that I didn’t want. So I emailed them back and asked if they even read it. Got another stupid response and at that point I made the decision that AA is just a garbage airline with a lot of people that should not be working in any capacity dealing with customers. I try not to fly domestic any longer and will spend my money with the foreign airlines, regardless of what support they get from their government. I don’t care if the F/A has put on weight or gotten older. But I do care that I receive a reasonable amount of service for the money that I pay. Don’t advertise how great your service is when it’s extremely poor. The difference in BA and Qatar, Qantas, and others is their F/A’s actually act like they are glad you are on board. They may hate us as much as the AA F/A’s do but they at least hide it from their passengers.

    As far as the prices being the same for the last 30 years that is probably correct, but the service has fallen off so much the airlines don’t deserve any raises.

  21. Spot on Mark Johnson. I’d pay more to fly an airline that has good customer service, the same that I’ll pay $20 for a burger at Fleming’s and not go to McDonald’s for a $4 burger. Let the airlines fail and the people with money and a desire to offer good customer service will pick them up and make a go of them. As far as the poster with the comment about air fares not rising in 30 years, it’s the airlines that drive the prices down, not the consumer. Only business I know of where the price is going down and they keep adding capacity.

  22. While I appreciate the frustrations many have with grouchy FA (or anyone in any job for that matter), I urge you to consider what they receive from demanding, entitled passengers each and every day!

    My dauggter is a 23 yr old.FA for AA and likely to be furloughed. She takes great pride in saying who she works for and worked hard to get this job! She takes her role very seriously and is always above and beyond helpful to passengers. She has shared horror stories of ways she has been treated and terrible things said to her, but she smiles through it and keeps giving it her all! This is all heartbreaking for her. Maybe, consider which comes 1st…the demanding passenger or the grouchy flight attendant?? While it doesn’t matter really, the expression “walk a mile in their shoes” may give you pause to over-generalize people.

  23. One of the problems Jennifer is that your daughter will never be my FA because she will never get to bid for business class international. And the problem isn’t with grouchy FA service, it is with zero service. Right after the throw the incorrect meal at you, they disappear. I suspect also that if people are saying terrible things or treating her terribly it is at least in part because that passenger has been treated like crap all day and just wants that pre departure beverage or a place to leave their bag. What comes first should be 1st class service to the passenger. Think about it, if your daughter lets a passenger get her into a bad mood, then that is going to be distributed to the entire cabin not just the offending passenger. I read that after the furloughs, the average age of FA will be 56. THAT is what is wrong with inflight service. That means that in business, the average age is going to be 90. I would suggest that your daughter work on her attitude and also go work for another airline because I have yet to meet a happy person working for AA.

  24. Sorry, but you’re spewing crap sir!
    I have traveled all over the country on Southwest, Jet Blue, American Airlines, Alaska Air, Delta, United and even Spirit (once, but I digress). And to be honest, yes I have encountered some miserable FA, but many more FA’s were very pleasant! Probably a “you get what you give” deal. But from reading your comments, I would assume (risky I know) that you have in common with me that you are in the upper middle to upper class…but the difference being that you seem to possibly believe that makes you better and entitled…well it doesn’t! I guarantee you haven’t gotten an “incorrect meal thrown at you” (but the way you treated their mistake may have made them want to!) Bet when your steak is cooked wrong in a restaurant you’re “one of those” patrons (input eye roll here). Somehow, I suspect you feel that many people “treat you like crap” in a day, not just FA’s or airlines…again, probably more what you’re putting out in the world!

    My daughter’s attitude is fine, she has worked business class international, 1st class, many a red eye…and nothing I said stated anyone “gets her in a bad mood”. And if you personally haven’t met a SINGLE happy person from AA (of the over 129,000) it is highly probable YOU may be the problem!

    As a mother of 5…one an SEC athlete, one a FA for AA, one an air traffic controller in the USAF, and a spouse of a retired US Naval officer, I assure you we taught none of them to jump ship to find a better, prettier one…if there’s a problem be a part of the solution. Enough said, good day:)

  25. Well, at least I will be able to go to sleep tonight knowing that I will never run into your daughter on an AA flight because by now she is most likely on the furlough list. And, at her age she shouldn’t have much in the way of D2 availability. Given your tone, I believe I also see a big part of the problem. My expectations are not based upon my station in life, they are based both upon the price I paid for business seats, and the contract that I keep believing that AA made with me when they booked the ticket. I notice in your list of airlines that you don’t mention any service oriented airlines. So perhaps judging your daughter’s performance at a non service oriented airline might be considered acceptable. Calling me a liar also tells me a lot. I hope you enjoy your daughter moving into your basement and I will wait and see if anyone here believes that AA isn’t getting exactly what they deserve albeit without my tax money.

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