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  • July 09, 2020
United Airlines told pilots, flight attendants and other workers that it could furlough 40 percent of its staff members this fall because of weak demand during the pandemic.
Credit…Justin Sullivan/Getty Images

United Airlines said on Wednesday that it could furlough as many as 36,000 workers, or nearly 40 percent of its staff, starting Oct. 1 if travel remained weak and if enough employees did not accept buyout and early retirement packages.

Airlines have been warning workers for months that they could start making significant cuts once federal stimulus funds expire. United received about a fifth of the $25 billion Congress authorized in March to help airlines pay employees as long as the companies made no significant cuts through Sept. 30.

The Oct. 1 furloughs would include about 15,000 flight attendants, 11,000 customer service and gate agents, 5,500 maintenance employees, and 2,250 pilots, among others. Those numbers could be smaller if ticket sales pick up significantly or if many thousands of workers apply for reduced hours or voluntary leave before a mid-July deadline United has set for buyouts and early retirement packages, the airline said in a memo to its employees. United is also cutting almost a third of management and administrative employees.

“The United Airlines projected furlough numbers are a gut punch, but they are also the most honest assessment we’ve seen on the state of the industry,” said Sara Nelson, president of the Association of Flight Attendants union, which represents nearly 50,000 workers at 19 airlines, including United.

In a statement, Ms. Nelson called on Congress to extend the stimulus funding “to avoid hundreds of thousands of layoffs from an industry that normally drives economic activity.”

In a separate development, United and American Airlines said they would suspend flights to Hong Kong after the authorities there said they would test all airline workers for the coronavirus starting on Wednesday. Airline crew members were previously exempt from the mandatory deep-throat saliva tests that nearly everyone entering the Chinese territory must take, and a cargo pilot tested positive for the virus last week.

United said in an emailed statement late Wednesday that flights to and from Hong Kong will be suspended “through July 10” because of “recent changes in testing protocol” at the city’s airport. Earlier this week, United said it planned to bring back services between Chicago and Hong Kong in September.

American Airlines, which has suspended flights to Hong Kong since the end of January, was due to resume services between Dallas and the city on Thursday. But the carrier has now pushed back the resumption of passenger services to early August. “We consider a range of factors including travel restrictions or entry requirements in making network decisions,” the airline said late Wednesday.

Niraj Chokshi and Elaine Yu

Article source: https://www.nytimes.com/live/2020/07/09/business/stock-market-today-coronavirus

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