Clobbered by the coronavirus pandemic, United Airlines is sending warning letters nearly half of its frontline workforce that they could be furloughed when restrictions on a federal bailout expire October 1.
The world's third-largest airline says 36,000 workers — including 15,000 flight attendants, 11,000 customer service and gate agents, 5,550 maintenance employees and 2,250 pilots — are about to receive 60-day mass layoff notices. The reductions are in addition to furloughs of office-based employees the company previously said it would cut.
"The reality is that United simply cannot continue at our current payroll level past October 1 in an environment where travel demand is so depressed," the company said in a message to employees.
The Wednesday announcement paints a grim picture for an air travel recovery only days after United announced it would ramp up its schedule in August.
The airline is operating only a quarter of flights compared to last year and says that planes are, on average, 55% full. United executives say demand for air travel has slipped recently in markets such as New York, where bookings at its Newark hub dropped as Covid cases surged.
United executives told reporters the company has done everything it can to protect employees — urging them to take early retirement and voluntary separation plans and aggressively raising millions in new money — but the airline is still hemorrhaging $40 million each day.
The airline, which reached an agreement this week with the Treasury Department to tap a loan fund, is also not counting on another round of relief to pass Congress.
“We do not feel like we can count on additional federal government support to survive and we have to take steps to protect the company and protect the long-term interest of the company and the prospects for united employees,” a company executive said.