Internal American Airlines documents describe the carrier’s plan to pay employees not to work, as part of the federal government’s Payroll Support Program passed by Congress as part of its stimulus legislation.
The second round of airline payroll support passed Congress and awaits the President’s signature, and American Airlines can expect about $3.5 billion from the federal government. In exchange they are obligated to bring furloughed employees back to work. They’ll be paid retroactive to December 1, 2020 and have to remain on payroll through March 31, 2021.
The intention of this legislation was that employees would actually work, stay current and ready to support more flying when people are ready to fly. That was at least the argument used to support giving U.S. airlines $15 billion, even though only 40,000 workers had been furloughed ($375,000 per worker for just four months).
The reality is very different. United Airlines has already told employees to expect to be re-furloughed effective April 1. American Airlines, in internal communications (“Returning to American – Top FAQs”) reviewed by View From The Wing, is telling employees they’re going to be paid but for the most part many won’t be working. In other words, American is taking the government’s $3.5 billion and complying with the terms by paying people.
- Since American doesn’t actually need more workers than they already have – furloughs were done with actual demand for flying in mind – it will take months to bring everyone back to work and payroll support only runs through March 31.
we are returning team members to work in phases based on operational need and administrative processing time required. The first group of team members that is being asked to return to work will receive those notices in accordance with their JCBA. We expect to continue to return team members to the operation in the months ahead.
- Employees who had their hours reduced will be paid their old full-time rates, but won’t be working more.
Our intention is to pay active part-time team members who were displaced from full-time status as full-time for the duration of the PSP2 extension, or Dec. 1 – March 31. These team members will continue to hold part-time positions; the adjustment will be for pay purposes onl
- American will pay non-union employees that they fired, but those employees won’t be coming back to work.
In accordance with PSP2, management and support staff who were involuntarily separated from the company may be eligible for pay and benefits coverage from Dec. 1, 2020, through March 31, 2021. We will reach out to these former team members directly with more information as it pertains to their individual situations
In most cases subsequent furloughs will require WARN Act notices to be sent two months prior to their effective date, which means new notices could be sent by the end of January. Since many employees will be getting paid but perhaps not yet back to work at the end of January, American Airlines could find themselves sending new WARN Act notices to employees before they’re even brought back to starting working under the payroll support program.
Anyone the airline induced to take a leave in order to reduce the number of employees they’d need to furlough, is out of luck. The federal government is picking up the tab for payroll, but they won’t get paid.
If team members were on a leave of absence at the time of furlough, and haven’t returned or weren’t scheduled to return to work prior to Dec. 2, the terms of that leave will still apply. They will not be receiving additional pay in accordance with PSP2. The company still has the opportunity to bring team members on voluntary long-term leaves back to work as needed to support the operation.
And while payroll support funds require the airline to pay people they don’t actually get their old jobs back. The airline has reduced the number of employees based in various locations, and those stay reduced.
Since payroll support is retroactive to December 1, employees who have been on unemployment find themselves in a complicated situation. For instance, many will not repay unemployment funds received, though in many cases they will be obligated to do so.
The federal government’s second bailout, ‘payroll support’, really is a makework program at best. But since most of the money goes to the airlines themselves, rather than covering the cost of people who were actually furloughed to bring them back to support the economy, none of this is surprising. Paying workers was a tax airlines were willing to bear in order to get billions of taxpayer dollars for themselves and their shareholders.