United knows it needs to downsize come fall, and it's trying to do so in as painless a way as possible.
United Airlines sweetened on Tuesday a voluntary exit package for flight attendants and extended the application deadline, saying it needed “a lot more people to sign up” to avoid involuntary layoffs in October, according to a document seen by Reuters.
In the United email to employees, sent 48 hours before a June 18 deadline, the company said that although “thousands” have signed up for the voluntary exit package so far, the number is not enough.
U.S. airlines cannot force any furloughs or layoffs before Oct. 1 under the terms of a government stimulus package that awarded money for employee payroll through September.
But many, including United, are trying to induce staff to depart sooner, warning that airlines must shrink in the fall.
“While we’re seeing some glimmers of hope in the number of customers traveling, we know that we are still a very long way from returning to where demand was at the end of 2019,” United said in the email.
“That means a quick recovery is not likely so we need to continue to focus on cost-cutting as we plan to be a significantly smaller airline in October,” the email said
Under the new deal, flight attendants would receive a $1,500 health credit – to pay for health care, including prescriptions – for every year worked, up to $45,000. The credits would be in addition to other medical, retirement and travel benefits already offered.
The deadline to apply is July 8.
United did not immediately reply to a request for comment outside normal business hours.
Last month, United told staff that it only needed about 3,000 of its about 25,000 flight attendants in June given its reduced flying schedule, Reuters reported.
Like other airlines, United is only operating a fraction of the flights it did last year.
(Reporting by Tracy Rucinski; Editing by Muralikumar Anantharaman and Gerry Doyle)
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Photo Credit: United Airlines Boeing 767 Anna Zvereva / Flickr