Wednesday, August 26, 2020

Pilots, Flight Attendant Unions React to American Airlines Job Cuts

Kimball Stone
American Airlines
Senior Vice President - Flight Operations & Integrated Operations Center
August 25, 2020

Fellow pilots,

This morning Doug Parker and Robert Isom outlined the next steps we must take as we face the reality that customer demand is not returning in the near term. We’ve spent the summer months determined to try and avoid, but preparing for this news, and designing a variety of options to minimize involuntary furloughs and separations in every department. Accounting for those accepting a voluntary program, we still have the heartbreaking task of involuntarily furloughing or separating approximately 19,000 people across the company on Oct. 1, unless there is an extension of the Payroll Support Program (PSP).

Here in Flight, it’s been determined that we need to furlough a total of 1,605 pilots. Our Chief Pilots will soon begin notifying 887 pilots that they are being involuntarily furloughed on Oct. 1, with the balance of the furloughs occurring in November and December. This is the exact opposite of what any of us expected at the beginning of this year. Back in the April-May timeframe, it became apparent that even in a post-pandemic world that our industry would take a year or more to recover. Keeping true to our mission of taking care of our people and protecting our airline, we threw out the old playbook, and took on the fight on behalf of our pilots.

So what did we do? We stopped hiring, taking a thoughtful approach to postpone plans of adding more than 1,000 pilots to our team. We crafted and immediately offered short-term, long-term, and permanent leave options. In June, we began brainstorming ideas, including novel and innovative approaches to furlough mitigation, collaborating with the new APA negotiating team as soon as it was finalized in late July. These conversations resulted in three voluntary options designed to lessen the number of necessary furloughs. This required a lot of out-of-the box thinking, and creative and complex coordination. Some options worked well and others were less successful. Through it all, we were focused on taking care of each of you, doing everything possible to minimize furloughs, and continuing to run a safe and reliable operation.

To offer a high-level summary, at the end of March, we had 15,710 pilots on the seniority list. We published the July 2020 preliminary seniority list with a total of 14,908 pilots, which reflected the mandatory retirements and other changes that had taken place since April. At that point, we had 2,300 more pilots than necessary to fly the future schedule. We were able to offset that number through the variety of voluntary furlough mitigation and leave options negotiated with APA, including 522 zero-line awards to pilots who otherwise would have been furloughed. With all leaves counted, we were able to reduce the final involuntary furlough count to 1,605. I would like to thank all the pilots who bid for one of the voluntary leaves, mitigation options or stand-in-stead. You’ve not only helped our airline, you’ve helped a fellow pilot.

I would be remiss if I didn’t address the collective effort that didn’t turn out as intended or have the desired result, the Voluntary Early Out Program (VEOP). The VEOP was envisioned with the intention of reaching those pilots who didn’t have the option of being considered for the VPLOA. We did not contemplate the high number of pilots with less than one year to retirement that bid for the VEOP, which not only negated the financial benefit of the VEOP, but in reality worsened the economic situation at a time where we can least afford additional expense. Unfortunately, this means we are unable to award any VEOPs. This is a disappointment as we all hoped that we could find a mutually acceptable solution with APA, and I believe there was opportunity to do things differently.

For those who will be placed on furlough, this is clearly difficult news. Any attempt to offer words of encouragement right now doesn’t change your immediate situation. But I can commit to you that our efforts to restore public confidence and increase demand are fully aligned with our priority to recall each of you as soon as possible. You are part of our story. And it won’t be until we celebrate your return, with you in uniform and reporting for duty, that we can consider our mission as accomplished and our story a success.


Involuntary staffing reductions effective October 1st.

In a letter to team members, CEO Doug Parker and President Robert Isom shared an update on involuntary staffing reductions effective Oct. 1 unless there is an extension of the Payroll Support Program under the CARES Act

Dear fellow team members,

We have come to you many times throughout the pandemic, often with sobering updates on a world none of us could have imagined. Today is the hardest message we have had to share so far - the announcement of involuntary staffing reductions effective Oct. 1.

As you all know, the Payroll Support Program (PSP) of the CARES Act protected our team against involuntary separations through Sept. 30. It also ensured that we and other airlines continued to serve each of the markets we flew prior to the crisis. It was an incredibly effective piece of legislation. By providing airlines the funds to pay much of our team member salaries and benefits, it ensured the commercial airline industry kept flying in the face of very low demand for air travel and kept our country moving, with all markets continuing to receive safe and efficient commercial air service.

The only problem with the legislation is that when it was enacted in March, it was assumed that by Sept. 30, the virus would be under control and demand for air travel would have returned. That is obviously not the case. Based on current demand levels, we at American now plan to fly less than 50% of our airline in the fourth quarter, with long-haul international particularly reduced to only 25% of 2019 levels. So, as Sept. 30 approaches, we have announced reductions in service, including the complete elimination of service to certain markets in early October, and today we are announcing the related reductions in our workforce.

In short, American's team will have at least 40,000 fewer people working Oct. 1 than we had when we entered this pandemic. We have worked to mitigate as many involuntary reductions as possible through voluntary programs. Across the mainline and regional carriers, more than 12,500 of our colleagues have made the difficult decision to leave the company permanently through early out programs or retirement. Another 11,000 team members have offered to be on a leave of absence in October. These are important life decisions and we respect and greatly appreciate the sacrifice these team members have made, and continue to make, for American and their fellow team members.

Even with those sacrifices, approximately 19,000 of our team members will be involuntarily furloughed or separated from the company on Oct. 1, unless there is an extension of the PSP. Furlough numbers by workgroup are provided below. Each group is in a different situation. For example, since international flying is being reduced more than domestic service, groups that are staffed more heavily toward international service may see a larger impact. Your individual leaders will be sharing more in the days ahead.

The one possibility of avoiding these involuntary reductions on Oct. 1 is a clean extension of the PSP. Led by your labor unions, with the support of the industry, we have generated enormous bipartisan support for such an extension. The overwhelming majority of members of both the U.S. House and Senate appreciate that saving jobs in the airline industry through this crisis will mean a quicker economic recovery in the months and years ahead. And that preserving these essential service jobs will also mean continued commercial air service to all communities, small and large.

But, despite this broad bipartisan support, a PSP extension is tied up in a larger COVID-19 relief package, which our elected officials haven't yet been able to negotiate. So we must prepare for the possibility that our nation's leadership will not be able to find a way to further support aviation professionals and the service we provide, especially to smaller communities. If you haven't already done so, you can let your elected officials know just how important a PSP extension is to you, your families and our economic recovery.

The coming weeks and months will be some of the most difficult we have ever faced. No matter how challenging they seem, remember this: The American Airlines team is no stranger to adversity, and in adversity, we always come through. We will come out on the other side of this crisis. Demand will return. Team members will be recalled. The world will find its new normal, and when it does, American is going to be there. Until then, take heart that we will get through this together. The professionalism and care this team has shown
over the past six months has been nothing short of extraordinary. We are all American Airlines, and we will survive, and one day, thrive again. Thank you for all you are doing now, and tomorrow, to carry us through. 

In July, the company issued approximately 25,000 WARN letters based on the staffing needs we anticipated for the fall. Since then, COVID-19 cases have continued to rise and consequently, customer demand has continued to decline. We now expect our fourth-quarter schedule to be down nearly 21 additional percentage points from what we projected in July, which has increased our projected staffing overage this fall versus our July WARN estimates.

Approximately 19,000 of our team members will be involuntarily furloughed or separated from the company on Oct. 1, unless there is an extension of the Payroll Support Program. In addition to the approximately 1,500 management and support staff involuntary separations that take effect in October, the company expects to furlough approximately 17,500 team members on Oct. 1. Below are the furlough estimates by workgroup. Exact details and timing vary by workgroup, and will be shared by leaders with their teams.

Anticipated furloughs by workgroup

Numbers are approximate; individual numbers will be communicated by workgroup

Pilots: 1,600 Furloughs
Flight Attendants:  8,100 Furloughs
Maintenance & Related: 800 Furloughs
Fleet Service: 2,225 Furloughs
Passenger Service: 1,275 Furloughs
Reservations: 0 Furloughs
Dispatch: 150 Furloughs
Flight Crew Training Instructors and Simulator Pilot Instructors:  10 Furloughs
Flight Simulator Engineers: 0 Furloughs
Wholly Owned Carriers 3,000 

American Airlines shared grim news with employees Tuesday. Furloughs or separation from the company will hit 19,000 workers unless Congress extends CARES Act funding before the end of September to provide more relief from the coronavirus pandemic.

The announcement came Tuesday in letters from top American Airlines officials to employees.

Of 17,500 union workers slated to be furloughed around the company’s network, more than 8,000 are flight attendants.

“The news is nothing short of devastation. The numbers are increased by a lot compared to what they thought they would be,” said Paul Hartshorn Jr. with the Association of Professional Flight Attendants.

Dallas-Fort Worth Airport is American’s largest hub. The company moved into a new Fort Worth headquarters building less than a year ago.

All those American Airlines workers spend money that trickles down to support other North Texas jobs. So union leaders argue it is not just airline employees who should be alarmed by Tuesday’s announcement.

“We are at the epicenter of a lot of other jobs and that’s why the CARES Act extension of that investment is so important. We just need a little more time and we’ll get there,” said Capt. Dennis Tajer, a spokesman for the Allied Pilots Association. The pilots’ union is based in Fort Worth.

In addition to the 17,500 union workers, another 1,500 management and support staff people are to be involuntarily separated by the end of September.

“This has the potential to reach way beyond the aviation industry and truly devastate the economy,” Hartshorn said. The flight attendants’ union is based in Euless.

The planned job cuts come after 23,000 other American Airlines employees took voluntary separation or leave earlier this year.

The company said current passenger traffic does not support the remaining number of workers.

Aviation attorney Kent Krause said it could be years before traffic returns to pre-pandemic levels.

“I would say we are looking at something like 2022 or something on that range when things are really clicking back on,” he said.

Business people who have become accustomed to teleconference meetings may find expensive travel less necessary in the future, as well.

“It saves our clients’ money and certainly allows us to work more efficiently so I do think some of those same sorts of things are going to continue,” Krause said.

The airline union people argue that cutting so many people would leave aviation unprepared for the economic rebound that could come as soon as there is a coronavirus vaccine.

“We're likely to do an interview in six months about how people can't find a seat and when they do it's very expensive,” Tajer said.

The unions said that airline people may not be able to return to work on extremely short notice.

“We have FAA required training that we have to meet,” Hartshorn said.

The airlines and their unions are pushing for an extension of the federal support.

Original article and video ➤

The Wall Street Journal
By Alison Sider
August 25, 2020 6:40 pm ET

American Airlines Group Inc said it would shed 19,000 workers October 1st, the first big wave of the tens of thousands of pilots, flight attendants, mechanics and other airline employees in jeopardy of losing their jobs when protections tied to federal aid to U.S. carriers expire this fall.

American’s cuts are short of the 25,000 potential job losses it warned were possible last month. But together with retirements and temporary leaves of absence, the reductions will make the carrier about 30% smaller than it was in March and are the clearest sign yet of the devastation coming for the airline industry as the summer travel season winds down and government funds run out.

U.S. airlines have warned employees that more than 75,000 jobs could be cut this fall. This week Delta Air Lines Inc. said it would furlough 1,941 pilots unless it reaches a deal with their union on other cost reductions. Earlier in the summer, United Airlines Holdings Inc. sent notices to 36,000 workers whose jobs it said could be at risk, though it hasn’t yet said how many will be cut.

The airline sector was one of the few that had protections as broader unemployment surged in recent months. Airlines agreed not to let any workers go through the end of September as a condition of the $25 billion they received under a broad economic stimulus package passed in March. Efforts to secure another $25 billion in funds to keep airline workers in their jobs through the end of March 2021 garnered bipartisan support but have stalled in recent weeks, as Congress has been unable to reach an accord on a broader pandemic relief package.

“It was assumed that by September 30th, the virus would be under control and demand for air travel would have returned. That is obviously not the case,” American Chief Executive Doug Parker and President Robert Isom wrote in a message to employees Tuesday. American plans to fly less than half its typical schedule in the fourth quarter.

Airlines had hoped to prevent the tumult the industry and its workers experienced after the September 11, 2001, terrorist attacks, when carriers within a matter of weeks outlined plans to let go tens of thousands of employees. Mr. Parker has said American wanted to avoid repeating moves from “the old playbook” in which airlines would immediately turn to job cuts in times of crisis.

After years of turmoil, including the 2008 financial crisis and the waves of bankruptcies and consolidation it triggered, airline employment levels only recently returned to near where they stood before September 11. Airlines’ ranks swelled by about 20% in the past decade as the industry enjoyed a record-long stretch of profits, according to figures from the Bureau of Transportation Statistics. Airlines’ biggest labor challenge before the pandemic was finding enough pilots to keep up with surging travel demand.

The pandemic is set to have an even deeper and longer-lasting impact on airlines’ finances than 9/11, several industry executives have said.

Carriers have spent months trying to lure passengers back onto planes after the pandemic nearly halted travel last spring. They have developed more-thorough cleaning procedures and toughened rules requiring passengers to wear masks. They have struck partnerships with medical institutions such as the Mayo Clinic and brands like Clorox. They have offered deep discounts.

Nevertheless, travel demand has stalled at around 30% of last year’s levels. Executives believe it will take years—and likely a Covid-19 vaccine—for it to fully rebound.

“We are six months into this pandemic, and only 25% of our revenues have been recovered,” John Laughter, senior vice president of flight operations, told Delta pilots in a memo Monday. “Unfortunately, we see few catalysts over the next six months to meaningfully change this trajectory.”

Airlines had hoped that summer, when throngs of people typically go on vacation, would bring higher travel numbers. American made plans to sharply expand flying to capture the increased traffic as demand started to rise in May and June. But the early optimism waned quickly as the virus continued spreading, triggering new travel restrictions that damped travel demand in July. Airlines began to scale back their plans.

The corporate traffic that would typically ramp up in the fall as business travelers jet to client meetings and conferences in the final months of the year shows no signs of returning. Governments around the world are still restricting travel—including between the U.S. and Europe—cutting off lucrative international traffic for major airlines.

“I’m afraid it’s hard to be positive for anything between now and the end of the year,” said John Grant, chief analyst at airline data provider OAG.

American’s reductions include 17,500 furloughs of pilots, flight attendants, mechanics and others, as well as 1,500 cuts from management and administrative ranks. They cover American Airlines itself as well as the two regional airlines it owns.

Other airlines including Alaska Air Group Inc,  JetBlue Airways Corporation and Spirit Airlines Inc have said they would be able to avoid furloughs at least for pilots, who are expensive to train and difficult to replace.

Southwest Airlines Company has said it can likely manage through this year without letting employees go after thousands agreed to take extended leaves or depart on their own.

“They did a good job enticing people away,” said Charlie Mattingly, one of the hundreds of pilots who accepted Southwest’s early-retirement offer and recently made his last flight. The prospect of giving up a decades-long career was an emotional one for many pilots, said Mr. Mattingly, who is also a principal at Leading Edge Financial Planning, which provides financial advice to pilots.

“I’ve been a pilot for 23 years,” he said, “and I’m not a pilot anymore.”

Original article ➤


  1. My initial thought upon seeing photos and reports of thousands of airliners 'temporarily' parked several months ago, worldwide, was that this industry is not 'coming back' to previous levels. This is permanent.

  2. No, it will get back to normal but it will take years. In the near term, there's an expected increase in the demand of freight pilots from large international to small regional as online shopping is expected to only increase even as global economies recover which will take years.

    A buddy of mine flies 744Fs around the world for Kalitta Air (yeah that Kalitta of drag racing fame) and cargo flight demand is the highest he's seen since being hired by them in 2003. Also business aviation is expected to again boom as Big Business is realizing the value of owning their own aircraft and not relying on airlines (and replacing older outdated less fuel efficient aircraft).

    Point being, there are now and/or soon to be opportunities out there for furloughed commercial airline pilots who look for it.

  3. The reality is much somber as this will be an opportunity for the powers to be to push for a single pilot cockpit with full on automation up to takeoff and autoland and the one human relegated to supervision duties.
    This means off the bat that demand for part 121 pilots will decrease a cool 50% across the board minus the small regionals unable to afford the new rides with all that automation.
    The main push will not necessarily be due to meager savings on already gutted salaries but the duty times that automation will allow basically doubling service and revenue generation on top of uniform liability exposure and probably lower insurance rates.
    In this game of musical chairs everyone gets to sit except the unionized proletariat...