American Airlines To Cut 5,000 Jobs, Despite $25 Billion Bailout


Nicholas Elias Contributor
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American Airlines sent a staff note to employees on Wednesday detailing a reduction in management and support staff by 30% despite receiving federal aid.

The move to reduce staff comes as the airline industry is crippled by the coronavirus pandemic despite states reopening. The airline company stated in the note that it has three main goals: ensure adequate cash to weather the downturn, reducing cash burn by removing as much excess expense as possible, and restoring confidence in air travel.(RELATED: ‘You Mexicans, Get Out Of My F**king Country’: Woman With Hammer Threatens Doctor And Husband)

“Although our pre-pandemic liquidity, the significant financial assistance provided by the government, and the cash we’ve raised in the capital markets provide a foundation for stability, we need to reduce our cost structure, including our most significant expense — the cost of compensation and benefits,” Elise Eberwein, American’s executive vice president of people and global engagement, said in the note that was obtained by the Daily Caller.

The note continued to say that 39,000 employees are already on volunteer leave or have retired early and that the company will operate 100 fewer aircrafts in the summer of next year. The company also suspended the managerial and support staff merit program for 2020 and is requiring all managerial and support staff to take 50% of their vacation by September 30 of this year.

“There is no doubt this is going to be a painful time for all, especially for our departing colleagues, who have given American Airlines their all and are leaving through no fault of their own.” said Eberwein, “They deserve our respect and gratitude.”

Management and support staff will have until the end of June 10 to apply for the buyout and American is offering volunteers a third of their pay through the end of 2020 and five years of travel privileges. Employees that are laid off after Oct. 1 will not receive the benefits.

Last month, according to CNBC, airlines began to receive parts of a $25 billion federal aid package created specifically for the airline industry. Any airlines that accepted this aide cannot lay off or cut pay rates of employees through September 30th.