- Expect employees to be assigned minimum hours
- And all discretionary compensation and bonuses (American Airlines has already informed employees that the Grand Slam 2020, Success at the Airport, Success at the Gate, Success on the Ramp, and Well Being Rewards all go away)
- And they’ll be encouraging voluntary furloughs, keeping benefits but with or without pay
United Airlines sent a message to employees today with a somber outlook for the industry. They led with the “good news” of the bailout and told employees “United will not conduct involuntary furloughs or pay cuts in the U.S. before September 30th.” That’s a requirement of accepting government funding.
What this means, however, is that United is highly likely to furlough workers on or about October 1. Or, if the bailout’s restrictions are interpreted based on Eastern time, then 11:01 p.m. at United headquarters on September 30.
The letter, under the signatures of both Oscar Munoz and Scott Kirby, says that they do not expect travel to fully recover this year and that means fewer employees. (Emphasis mine.)
The global economy has taken a big hit, and we don’t expect travel demand to snap back for some time. Our April schedule is already cut by more than 60% and we expect our load factors to fall into the teens or single digits even with 60% less capacity. We are currently planning to make even deeper cuts in May and June.
And, based on how doctors expect the virus to spread and how economists expect the global economy to react, we expect demand to remain suppressed for months after that, possibly into next year. We will continue to plan for the worst and hope for a faster recovery but no matter what happens, taking care of each of our people will remain our number one priority. That means being honest, fair and upfront with you: if the recovery is as slow as we fear, it means our airline and our workforce will have to be smaller than it is today.
What United says is the reality of the industry. Fewer customers, fewer flights, will be serviced by fewer people. Allocating nearly $60 billion to the U.S. airline industry hasn’t changed that. It’s just delayed it to the fall.