American Airlines warns 20,000 could lose jobs, flight attendant staffing will be very different

Over the weekend of July 25, Jill Surdek, American Airlines SVP of Flight Service sent a memo to flight attendants offering details of what they should expect come Oct. 1 after the CARES Act expires.

Unsurprisingly, the details don't look great. Many flight attendants — even those with long-term seniority — will be placed on reserve duty, meaning that they'll be placed "on call" for any trip. Plus, with limited international flying expected through next year, there'll be less opportunity for those exciting trips. Instead, many will be four-day, grueling domestic hops with lots more flights per day and shorter layovers.

The memo also warns of displacements to other bases, meaning that crew might need to commute or move to another city. Lastly, the letter mentions that masks will be mandatory for the seeable future.

American Airlines originally sent a letter to 25,000 employees on July 15 notifying them they may not be needed come fall. The news was first reported by the Wall Street Journal. American said as many as 20,000 employees could lose their jobs. That would be as much as 29% of front-line workers. Previous layoffs including administrators and mangers led to 5,000 job cuts.

It comes exactly one week after United sent similar letters to 45% of its workforce.

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The Texas-based airline is required by federal law to send notice to employees of potential layoffs or furloughs in advance. Under U.S. labor laws airlines must give workers 60 days notice. 25,000 letters were reportedly sent out. That includes airport employees and operations employees.

The notices are called WARN letters also known as Worker Adjustment and Retraining Notification Act letters. Reuters reporter David Shepardson posted one of the letters on Twitter.

In the letter, AA says it was hoping to see a rebound in air travel by October when the CARES Act that helped bailout the airlines expires. Growing outbreaks of the coronavirus in the United States appear to have delayed that rebound at the very least. They say passenger revenue was down 80% in June 2020 compared to June of 2019.

Airlines including American that received federal help under the CARES Act are barred from enacting layoffs and furloughs through September.

The airline tells employees that it will support the various unions representing employees at the company in their efforts to get the bailout extended.

There are active talks with the U.S. congress to do more CARES-style funding to avoid these layoffs.

TPG talked with Sara Nelson, the International President of the Association of Flight Attendants-CWA, AFL-CIO. She said, "We’re starting to see … a little bit of a change in narrative from Senate Republicans and from the White House about a willingness to do a coronavirus relief package,” she said. “So I think that we’re going to see it.”

Related: 5 key elements of the $50 billion airline aid package

Meantime, American Airlines is also asking employees to strongly consider early retirement or long leave offers the airline has made.

The letter says, "We know that American will be smaller going forward, and we must right-size all aspects of our airline to adjust to that new reality."

As recently as June, American Airlines CEO Doug Parker said he'd hoped to avoid furloughs.

Related: Airlines walk a fine line with staff cuts after taking coronavirus aid.

Some carriers have warned they expect to emerge from the crisis 20% to 30% smaller. Delta Air Lines reported a nearly $6 billion second-quarter loss and said it was retiring some jets early.

“In this environment, we need to resize our business and build resilience to create a new, stronger Delta,” Delta chief financial officer Paul Jacobson told staff in a memo viewed by TPG. “That means streamlining our company, simplifying our fleet and reducing our fixed cost base in ways not feasible in the past.”

More from Delta’s Q2 earnings: Delta says air travel recovery has stalled, hopes more flyers return by end of summer

Back in June, Delta reported it would cut up to 2,500 pilots and close some flight attendant bases.

On July 7 United Airlines warned 36,000 employees they could be let go in October.

Additional reporting by Zach Griff, Ned Russell and Zach Wichter.