Washington (CNN Business)With no air travel rebound or new federal help in sight, United Airlines says it will furlough about 20% of its frontline employees in less than a month’s time.
In a new memo to its employees, United (UAL) says that 16,370 employees will be furloughed when payroll restrictions attached to a federal bailout expire October 1. United executives told reporters on Wednesday that the number is less than half of the airline’s July furlough forecast, thanks in part to 7,400 employees accepting early retirements or voluntary departures, and an unspecified number taking unpaid leave.United’s memo calls furloughs a “heart-wrenching” last resort, but the airline “cannot continue with staffing levels that significantly exceed the schedule we fly.”
The airline industry could shrink by half to survive, United Airlines chairman says”It is our expectation that things don’t get anything back close to normal until a vaccine is developed and widely administered,” said a United executive on a briefing call with reporters. He stressed that an extension of CARES Act payroll protection can stem furloughs– and that the airline in in touch with the White House and congress—but a new bailout appears unlikely.”To be clear, an extension would be the one thing that would prevent involuntary furloughs on October 1 and hopefully delay any potential impact on employees until early 2021,” reads the memo.
Source: edition.cnn.com