United has publicly warned of layoffs. They won’t need nearly as many employees given lower levels of air travel demand, and making these warnings publicly sets them up to ask for another government bailout.
Despite provisions of the first airline bailout that require airlines to keep everyone employed through September 30, and maintain rates of pay, airline lobbyists got CARES Act language changed to allow airlines to reduce hours and therefore pay employees less. United is imposing forced unpaid vacation on non-union workers.
Unsurprisingly airlines are doing their best to get workers to take leaves and early retirements. United has a new offer for some employees that includes airline elite status and miles.
- Take an early out at the end of June, get 1/3 pay until November 30
- Continue to receive health care through November 30
- Receive Mileage Plus 1K status and 250,000 miles
- Plus 5 years of active employee travel benefits, and then retiree travel benefits
- Plus ‘priority access’ to future job openings
It may make sense to take an early out, if the offer is better than straight termination in a few months. And since most of the benefits accrue only in 2020, the airline is likely to remain out of bankruptcy long enough to deliver.
The elite status and miles are of some value for those who plan to travel, even aside from their employee travel benefits. Of course we’ve already seen United devalue both programs during this crisis.
Whether or not this makes sense depends on (1) an employee’s seniority, and thus their likelihood of furlough, and (2) what they think future offers may look like.