United Airlines notified about 36,000 employees that they could be furloughed Oct. 1, the company confirmed in a filing with the U.S. Securities and Exchange Commission. The carrier had agreed not to furlough any employees through Sept. 30 as a condition of accepting $5 billion in federal grants and loans under the terms of the Coronavirus Aid, Relief and Economic Security Act.
United CEO Scott Kirby in May warned the carrier would require "extremely painful" actions in terms of its employees if demand buffeted by Covid-19 didn't increase.
The carrier this week held town hall meetings with employees at which "members of
management indicated that consolidated capacity for June 2020 was down approximately 88% year-over-year and that July 2020 consolidated capacity is expected to be down approximately 75% year-over-year. Members of management also indicated that consolidated capacity for August 2020 is expected to be down approximately 65% year-over-year," according to another SEC filing.
The U.S. Worker Adjustment and Retraining Notification Act, enacted in 1988, requires large employers to give at least 60 calendar days of notice before a mass layoff.
United SVP of worldwide sales Jake Cefolia wrote in an email to clients that "not everyone who is covered by the WARN notice will be furloughed," and that the carrier expected "increased participation in voluntary programs," but that "the reality is that we simply cannot continue at our current payroll level past October 1 in an environment where travel demand is so depressed."
Cefolia also cited the resurgence of positive Covid-19 cases throughout the United States as "exacerbating the problem."