Airline CEOs plead with Washington as layoffs loom

The race to prevent massive airline layoffs in October is heating up with CEOs and union leaders pleading with the White House and Congress to reach a deal for more industry aid. 

Employers say they will have to start cutting tens of thousands of jobs in a little more than a week without congressional action. But despite bipartisan support to prevent job losses from hitting flight attendants and pilots, an agreement remains elusive amid a stalemate over a broader coronavirus relief bill.

Airline executives were in Washington this week pressing their case with leaders from both parties. They met with White House officials on Thursday and spoke by phone the following day with Speaker Nancy Pelosi (D-Calif.) and House Transportation and Infrastructure Committee Chairman Peter DeFazio (D-Ore.).

Nicholas Calio, head of the industry group Airlines for America, called Friday’s conversation “very productive,” adding that it was focused on the urgency for action on a COVID-19 package.

“We have been encouraged by the strong bipartisan, bicameral support on Capitol Hill to help airline workers; however, we need action before September 30. These are dire times. Our leaders need to get something meaningful done – and it needs to get done now,” Calio told The Hill in a statement.

Henry Connelly, a spokesperson for Pelosi, said, “All participants on the calls agreed that keeping aviation workers at their job and certified is crucial to promoting commerce, preserving service to communities, and protecting good union jobs.”

Airlines are calling for a six-month extension of the Payroll Support Program (PSP) that was included in the CARES Act in late March. Under the terms of that law, airlines are prohibited from firing or laying off any employees until Oct. 1.

But in order for there to be an extension, Congress would need to pass new legislation.

Airlines are requesting that any new package provides them with a $25 billion injection to postpone any job cuts at least until April, giving companies more time to recover, potentially leading to fewer layoffs. However, the industry has said it doesn’t foresee a full recovery until 2024.

On Oct. 1, American Airlines expects to ax 19,000 jobs, and United Airlines said it plans to cut 16,370. Southwest Airlines warned that as many as 36,000 employees could face furloughs. 

Delta Air Lines expects to lay off pilots on Oct. 1 but announced this week it will not furlough any flight attendants and front-line workers in 2020 due to the many employees who opted for early retirement. 

Southwest Airlines CEO Gary Kelly told The Hill on Friday he is feeling optimistic about the prospects for action. 

“After my meetings this week, I believe wholeheartedly that most federal leaders, both Republicans and Democrats, want to strike a deal – and soon – on a larger aid package, of which the airline Payroll Support Program (PSP) would be included. I feel more optimistic today than I did a week ago,” he said.

The coronavirus pandemic has hit the airline industry particularly hard. Passenger volumes are down 70 percent worldwide, a third of the U.S. commercial fleet remains idled and carriers are collectively burning more than $5 billion in cash each month.

Airline job losses in the tens of thousands would deal a significant blow to the economy just weeks before Election Day. Several battleground states, where a number of major airline hubs are located, would bear the brunt of the job cuts.

Company executives are concerned the election could be more of a hindrance than a spark.

“While I greatly appreciate the bipartisan support for extending PSP, I am concerned that election year politics and plain old stubbornness will get in the way of our federal leaders finding common ground on a larger relief package, which our country desperately needs and needs now,” Kelly said.

Top Republicans and Democrats have also been hearing from labor groups that want the government to provide another lifeline to the industry. 

Several unions, including the Professional Airline Flight Control Association, and the Airline Division of the International Brotherhood of Teamsters, joined United Airlines to call on the Trump administration and congressional leaders to extend relief. Other unions, including the Allied Pilots Association and the Association of Professional Flight Attendants, joined American Airlines earlier this week with the same request.

The administration is putting pressure on Congress to prevent the layoffs, while trying to paint Pelosi as the main obstacle.

White House chief of staff Mark Meadows said this week there isn’t a good option for executive intervention.

He told reporters on Thursday that it’s “incumbent” for Pelosi to act and that the White House has looked at a number of executive actions but “all of them are less than ideal.”

“There’s a few things that we could do, but I don’t know that it actually solves the problem of curtailing furloughed workers,” Meadows said.

Pelosi on Thursday stressed that assistance is needed across industries.

“The needs have only grown. Some of the needs for the small businesses, needs for restaurants, needs for transportation and the rest,” she said. 

Action that focuses on relief for the airlines alone would undoubtedly draw criticism from other labor unions and advocates for other hard-hit industries like restaurants and retailers.

American Airlines CEO Doug Parker stressed that government assistance is needed across the board, not just for his employees and those of his competitors.

“By no means are we suggesting that the airline employees deserve help and the rest of the country doesn’t. This pandemic is affecting millions of Americans and for the same reason that we should get COVID relief passed to help those millions of Americans get through this,” Parker told NBC News on Friday.