American, United Airlines to Furlough 32,000 Workers After No Pandemic Stimulus Deal

October 1, 2020 Updated: October 1, 2020

American Airlines and United Airlines said that they will start to furlough more than 30,000 employees after lawmakers and the White House failed to reach an agreement on stimulus relief measures that would include federal aid for airlines in the midst of the CCP (Chinese Communist Party) virus.

American Airlines CEO Doug Parker told The Associated Press that if Capitol Hill comes up with a deal in the coming days, the company will reverse nearly 20,000 furloughs that are slated for Thursday. United Airlines added that it has to furlough about 13,000 workers, telling the White House and Congress that if payroll aid is approved, it could undo the furloughs as well.

United Airlines CEO Scott Kirby said that “we implore our elected leaders to reach a compromise, get a deal done now, and save jobs,” according to the Chicago Business Journal.

“The CARES Act Payroll Support Program funding for our airline expires today, September 30. That means after months of aggressive cost-cutting and proactive debt-raising actions to manage the company through the Covid-19 crisis and its impact on our business, we regrettably are forced to move forward with the process of involuntarily furloughing about 13,000 of our United team members,” he added.

American and United airlines said they would try to apply for more loans from the federal government and will lobby Congress to pass a stimulus deal that includes funding for airlines.

“Unfortunately, there is no guarantee that any of these efforts will come to fruition,” Parker said in a letter. “However, in an effort to encourage competition and keep hope alive for our team, I informed the Secretary [Mnuchin] that if these efforts to extend PSP are successful over the next few days, we will reverse our furlough processes and recall any impacted team members.”

The furloughs come in the midst of stalled talks on how to proceed with the stimulus package. House Speaker Nancy Pelosi (D-Calif.) and Democrats unveiled a $2.2 trillion HEROES Act 2.0 that would include airline aid, but it was deemed too expensive by some Republicans, including Senate Majority Leader Mitch McConnell (R-Ky.), who told reports that Democrats and Republicans are “very far apart.”

Treasury Secretary Steven Mnuchin and Pelosi spoke this week on a deal but no agreements were hashed out yet.

“We will be proceeding with our vote tonight on the updated Heroes Act in order to formalize our proffer to Republicans in the negotiations to address the health and economic catastrophe in our country,” Pelosi said in a statement.

It’s not clear when the two parties will meet again.