United Airlines and American Airlines have sent furlough notices to a total of more than 32,000 employees, saying they can't afford to have them on payroll after Thursday – the expiration date for the CARES Act.
American Airlines check-in counters sit closed last month behind plastic barriers at Los Angeles International Airport.Bing Guan/Bloomberg via Getty Images
American sent a similar message to 19,000 employees, with CEO Doug Parker saying the furloughs could be reversed if Washington manages to reach a new business aid package. He also said there is hope for a CARES Act extension — and he pledged to immediately reverse the furloughs if a deal is reached"over the next few days."
The four largest U.S. airlines promised in April not to lay people off through the end of September, in exchange for receiving billions in federal payroll support loans. American received $5.8 billion, Delta got $5.4 billion, United got roughly $5 billion and Southwest got nearly $3.
The U.S. government's pandemic relief effort had provided some $25 billion in loans and grants to airlines, which quickly racked up billions of dollars in losses after the COVID-19 pandemic effectively shut down most of the travel industry in March. With revenue sharply down, U.S. airlines are collectively burning through more than $5 billion of cash every month, Airlines for America says.
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