Sixteen Republican senators are calling on their party’s leadership to add another US$25 billion in assistance for airlines in a package being negotiated for Covid-19 assistance.
The senators, led by Cory Gardner of Colorado, said in the letter that they fear carriers will have to fire thousands of workers after existing payroll assistance expires on Oct. 1. Among the people signing the letter was Mississippi Senator Roger Wicker, who is chairman of the committee overseeing aviation policy.
Airlines are operating this year with about 27 per cent of the number of passengers they carried last year and gradual increases in May and June stalled last month, according to Transportation Security Administration data. As a result, all the large carriers are suffering billions in losses and have been in discussion with their unions about staff reductions that could number in the tens of thousands starting in October.
“For these reasons, we support a clean extension of payroll support for passenger air carrier employees included in the CARES Act to avoid furloughs and further support those workers,” the senators said in the letter addressed to Majority Leader Mitch McConnell, a Kentucky Republican, and Minority Leader Chuck Schumer, a New York Democrat.
The legislation passed last spring provided US$25 billion in money to support payrolls at passenger airlines under the condition that there would be no job cuts through September.
Even if the proposal didn’t make it into this round of stimulus, it could find itself attached to a September government funding bill. There’s been talk on Capitol Hill of combining the bill needed to prevent an Oct. 1 government shutdown with a transportation measure and additional virus relief if needed.
Reuters previously reported on the senators’ letter.
The push to extend the payroll support program began with a coalition of flight attendant unions and later grew to include labor groups across the industry. Last week, 223 members of the House backed the extension in a letter to congressional leaders.
More recently, several airline chief executives have added their support to the effort as the pandemic continues to decimate demand and airlines get ready to enter what’s historically been the slowest part of the year.
“We support our unions and their efforts for this clean six-month renewal,” Southwest Airlines Co. Chief Executive Officer Gary Kelly said July 31. “Just as before, I am personally involved in delivering that message to our federal leaders.”
American Airlines Group Inc. CEO Doug Parker and United Airlines Holdings Inc. executives also have backed the legislation.
U.S. carriers have warned about 76,000 employees that they could face furlough on Oct. 1, according to estimates by a Cowen Inc. analyst. That’s when restrictions in the current payroll aid end.
The number will be reduced by an unknown amount as a result of voluntary separation, early retirement and extended leave programs already offered by carriers. Southwest has said enough workers took its offers that it won’t lay off any at least through the end of this year.