Even after more than 39,000 employees signed up for voluntary severance packages, and about 5,000 office and executive staff were told a couple of weeks ago that their services no longer are needed, American Airlines expects still to have around 8,000 more flight attendants this fall than it will need.
The Fort Worth-based carrier informed its flight attendants’ union, the Association of Professional Flight Attendants, that one way or another, the excess attendants will be gone by February. Per its contract with the APFA American soon will launch another round of incentivized separation packages, though it did not reveal what or how valuable thee incentives to leave will be. But if still not enough take the offers, the carrier will begin issuing layoffs.
American ended 2019 with around 25,300 active attendants. A number them since have left – or have agreed to leave at specified dates spaced out over the year – as part of the group of 39,000 employees from throughout the company that accepted various early-retirement, voluntary/partially paid leaves, or other forms of incentives to leave the airline’s employment. The carrier has not said how many of those who accepted the early-out offers were flight attendants. Still, even after those reductions, American will have around 8,000 attendants in excess by October 1. How many will be retained is not yet clear, but it’s likely to be around or even less than 15,000 based on the general expectation that a third to 40 percent of airline employees directly involved in flight operations will have to be removed from payrolls for the carriers to have any hope of avoiding bankruptcy, or worse.
In addition to cutting those additional 8,000 attendants’ jobs, Jill Surdek, American’s senior vice president of flight service, disclosed in a letter to the APFA’s leadership that effective next February its current flight attendant bases – where attendants based there big and end all their trips – at St. Louis and at Raleigh-Durham, NC, will be closed.
APFA officials said they were able to persuade management to designate both bases as “sub-bases” at least temporarily. As such, attendants could begin and end their trips there, but their managers will be officed elsewhere and there’s no guarantee that there will be enough duty assignments that begin at either base to satisfy the desire for such assignments among those wishing not to move away from those bases.
The union also said it will continue to resist American’s plans, also announced Wednesday, to cut back on the number of flight attendants assigned to each flight. American plans to cut back to the minimum number required by the Federal Aviation Administration’s rules, plus one. Thus a Boeing 737 with 170 seats would be required to have four attendants based on the formula of one attendant for ever 50 seats (with, in this case, a fourth attendant required for any number of seats between 150 and 199). Thus, American now plans to assign just five attendants to such planes, though currently it often assigns six. The difference would be sharper on larger planes, like the Boeing 777, which American equips with 265 seats. The FAA minimum requirement would be that it be staffed six attendants. American now says it will assign seven attendants to such flights, though previously it has assigned as many as 10 to 777 flights.
American also will shut down a six-year-old help center in Phoenix that was created to help attendants work out difficult scheduling issues and other problems.
It is not yet known how many pilots or mechanics and other airport workers will be laid off eventually. Those numbers won’t be clear at least until all those who have already volunteered, or who my yet volunteer to leave, actually make their exits.
But American’s operations, like those of most other carriers, remain only a fraction of what they were before the pandemic. Only this week American increased its flight operations to the point that it is flying 40 percent of the capacity it offered one year ago. And passenger demand across the industry is still only about 25 percent of what it was prior to the pandemic.
By Christmas American likely will be flying no more – and perhaps less – than 60 percent of its year-ago capacity. It currently is planning to be operating about 80 percent of its 2019 capacity by July 2021, but such plans remain very fluid and could be pulled back, or beefed up, depending on the spend and strength of the expected recovery in travel demand.
American already was being heavily criticized by investors for an enormously bloated payroll of around 130,000 people prior to Covid-19’s arrival. By comparison, Delta, which was flying 844 planes before the pandemic, is roughly the same size as American, which was operating 871 of them. But Delta was doing the job with 91,000 employees to American’s 130,000, or 30 percent fewer total workers.
And Delta’s employment total is not a stationary target at which American can aim. It, too is offering incentives to entice employees to depart voluntarily. Beyond that, it likely will have to resort to layoffs to reduce costs even further during a time when airline revenues are down by as much as 75 percent in some cases.
Thus American conceivably could have just over half as many people on staff by next February, one year after U.S. airlines began to realize that the coronavirus that was destroying travel demand in Asia was likely to have a similar impact in the U.S. market, as it did in February this year.
Congress’ passage of the CARES Act in April included up to $50 billion in grants and low interest loans for U.S. carriers. But the $17.5 billion in grants and some of the loan money authorized by Congress was meant to support carriers’ payrolls through Sept. 30. As a condition, the airlines cannot issue voluntary layoffs until after that date. Unions through the industry already have begun calling for Congress to extend more such aid to protect airline workers’ jobs, though as yet there’s been no indication from Congressional leaders whether they would support or even consider extending that financial aid beyond Sept. 30.