American Airlines has sent out letters to roughly 25,000 employees about possible layoffs and furloughs. The Worker Adjustment and Retraining Notification letters, as they are called, are required by law 60 days before layoffs or furloughs are anticipated.
The letters from the airline specifically say they are taking this step because of “overages we may start to see Oct. 1 when our Payroll Support Program funding expires.”
They reference customer revenues being down 80 percent in June 2020 compared to June 2019. The company says they have 20,000 more employees on payroll than they “will need to operate our smaller schedule this fall.”
American says they hope to lessen the number of furloughs by offering employees opportunities like extended leave and early retirement.
"We know American will be smaller going forward and we must right-size all aspects of our airline to adjust to that new reality," the letter said.
United Airlines sent nearly 36,000 similar letters to employees earlier this month. At the time, United said the notices covered about 45 percent of their U.S employees.
Delta Airlines, who has not signaled any furloughs or layoffs at this time, did report low second-quarter earnings earlier this week. Delta is the first U.S. airline to report financial results for the April-through-June quarter, and the numbers were ugly.
The number of passengers tumbled 93% from a year earlier, revenue plummeted 88%, and the company’s adjusted loss was worse than expected.