May 13, 2020 | COVID, Featured, Featured News, Front Page, Home, MNPL |
May 12, 2020
Mr. Oscar Munoz
Chief Executive Officer, United Airlines, Inc.
PO Box 06649
Chicago, IL 60606-0649
Dear Mr. Munoz,
I am alarmed by United Airlines’ decision to eliminate 3,400 management and administration positions on October 1, 2020 and reduce approximately 15,000 full-time positions to part-time on May 24, 2020. These actions are not only devastating to the employees who will lose all or some of their income, but also violate the congressional intent behind the Payroll Support Program.
On April 15, 2020, United Airlines accepted $5 billion in taxpayer assistance via the Payroll Support Program, $3.5 billion of which will not need to be paid back. By accepting these funds, United Airlines committed to not reduce employee pay or benefits, or implement involuntary furloughs through September 30, 2020; to limit executive compensation and prohibit stock buybacks or dividends through September 30, 2021; and to protect collective bargaining agreements through September 30, 2020. This program was created to give airlines time and flexibility to adapt to changing economic conditions caused by the COVID-19 pandemic, and find ways to minimize layoffs.
I am concerned several recent decisions made by United Airlines potentially violate the requirements of the Payroll Support Program, and certainly violate the spirit of the law. United Airlines announced a planned 30 percent reduction of management and administration positions five months before the reduction can legally occur. While not illegal, the early announcement indicates that United Airlines is not using the time and flexibility provided by the Payroll Support Program to save jobs.
On March 27, 2020 you promised your employees that United Airlines would “not conduct involuntary furloughs or pay cuts in the U.S. before September 30, 2020.” Unfortunately, this commitment appears to have been misleading. United Airlines sent memos to over 11,000 employees, which included instructions requiring employees to take 20 unpaid days off before they are fired, and implementing mandatory hour reductions. Both practices reduce employee pay without consent, undermining your promise that taking care of employees will remain your number one priority.
Further, United Airlines announced on May 1, 2020 that 15,000 workers, including baggage handlers, customer service agents, and reservations agents, would transition to part-time work at the end of May. These employees were given 13 days to decide if they would accept their planned reduction to part time status, voluntarily leave their job without recall rights, retire with no recall rights, or choose to furlough with furlough pay and a right of recall. Not only does this supposed request reduce employee pay, in a potential violation of the Payroll Support Program, it presents employees with an impossible choice: struggle to pay the bills while taking home a smaller paycheck or try to collect unemployment and find a job in one of the worst labor markets in history. This choice is made even more difficult by the fact that most states consider unemployment applications from individuals who voluntarily left their jobs on a case-by-case basis, meaning the applications are more likely to be denied and take longer to process.
While I am glad that public outcry and pending legal action pushed United Airlines to make these mandatory hour reductions voluntary, I remain deeply concerned by your labor practices. I am particularly troubled by the statement that the originally proposed mandatory hour reductions will be implemented by late June if an insufficient number of employees volunteer to reduce their hours. The very act of threatening across-the-board schedule reductions makes the current ‘voluntary’ reductions anything but voluntary.
United Airlines Spokesman Frank Benenati was correct when he stated that it is not sustainable for the company to spend billions more than it takes in. However, it is also correct to state that a business model that spends 80 percent of free cash flow on stock buybacks, just as United Airlines has done for the last decade, is unsustainable. For years, the business prioritized increasing stock values for shareholders and top executives over saving and preparing for the next economic downturn. United Airlines would be less reliant on government assistance and would not have to push workers off the payrolls if company leadership focused on long-term sustainability instead of enriching themselves.
I urge United Airlines to honor the commitments you made to your employees and the American people by ending your efforts to cut employee hours and calling off the upcoming layoffs. We can only weather this crisis if all parties work together and act in good faith.
I look forward to your response.
Sincerely,
Joseph P Kennedy, III
Member of Congress
Please print and post on all IAMAW Bulletin Boards.
May 9, 2020 | MNPL |
Congresswoman Jackie Speier (D-CA) called out United Airlines for its attempt to furlough thousands of front-line essential workers. The carrier tried the move after accepting billions of taxpayer dollars that it promised to use on payroll costs but reversed course after union opposition.
When the Coronavirus Aid, Relief, and Economic Security (CARES) Act passed Congress with overwhelming support, airlines like United lined up to get their share of the $50 billion in aid specifically allocated for them. The CARES Act directed air carriers to spend the money on payroll, which is a large portion of their operating costs, to help avoid bankruptcy at least until October. By then, they planned to draft a new relief bill or hoped a treatment for COVID-19 would be available.
The Federal aid came with strings attached. First, executives and shareholders couldn’t use it to increase executive and management pay, to boost stock buyback schemes, or invalidate collective bargaining agreements. Second, the money had to go towards paying their employees. Airlines, including United, promised not to cut pay and benefits until October.
“United will not conduct involuntary furloughs or pay cuts in the U.S. before September 30th,” United CEO Oscar Munoz said in a memo to United’s 100K employees on March 27.
On May 1st, International Workers Day, incoming United CEO Scott Kirby confirmed the involuntary furloughs of all US-based full-time ramp and customer service agents to part-time, resulting in pay cuts of at least 25%, effective on May 24 – nearly 5 months before October. Similar cuts to non-union administrative employees followed a few days later.
The $5 billion in payroll assistance is not enough to cover the full operating costs the airline faces, Kirby argued, so executives looked for loopholes and excuses to keep the money and ignore their obligations to use it to keep employees intact. According to Kirby, they were keeping the money and cutting back employee compensation and benefits five months before the agreed-upon October date. Kirby contends that, since executives wanted to cut pay by cutting hours, they were in “full compliance with the CARES Act” which forbids cuts in pay if the airline accepts taxpayer help. (Thanks to the CARES Act, labor costs are covered by taxpayers, not passengers.)
The immense outcry from passengers, unions, and lawmakers did not take long.
Just before United backtracked from the decision, Representative Jackie Speier (D-CA) released a statement calling out the plan to lay off thousands of workers, stating she was “dismayed” to learn of the move.
“Your company has agreed to take approximately $5 billion from the CARES Act Payroll Support Program. This includes a grant of $3.5 billion and a 10-year loan for $1.5 billion” the Congresswoman said a letter to CEO Oscar Munoz. “United itself acknowledged that the receipt of this federal government money ‘Will be used to protect the salaries and benefits of employees through September 30, 2020.’”
Congresswoman Speier noted in her statement that United executives “have announced the reduction of scheduled work hours by 25% for almost 1,600 United Airlines employees at San Francisco International Airport (SFO), effective May 24, 2020.”
Rep. Speier represents California’s 14th Congressional District, including the area adjacent to SFO Airport, one of the largest and most historic airfields in the US, and an important hub for United Airlines.
The furloughs at United would not have been mere hour reductions. As hourly workers, the benefits airline employees receive are tied to the total of hours worked. This means that a cut in scheduled hours would also reduce vacation and sick time accruals, holiday pay, pension contributions and unemployment insurance options. Amid a global pandemic, many would have lost eligibility for Family and Medical Leave Act protections, plus other benefit programs which vary state-by-state.
“This is not the way to protect the salaries and benefits of these 1,600 employees and their colleagues throughout the country,” Rep. Speier said. “United contends that this 25% reduction in work hours does not violate the CARES Act because their hourly rate of pay did not change. I find that position disingenuous and not in the spirit of the CARES Act. These workers will have a 25% reduction in their gross incomes,” the Congresswoman said.
Congresswoman Speier has been a strong supporter of United’s unionized ramp and customer service workers for years. In 2013, she worked to protect the Maintenance Operations Center at SFO. That facility is one of the largest on the West Coast and employs 3,500 workers.
The ramp and customer service agents that United attempted to furlough are represented by the International Association of Machinists and Aerospace Workers. The IAMAW is the largest union of aerospace and transportation workers in North America, with members at all major airlines, and at NASA, Boeing, Lockheed Martin and Bombardier.
“We are overwhelmed with the support we are getting from lawmakers like Rep. Speier,” said IAMAW District 141 President and Directing General Chair, Mike Klemm, in a statement. “To have the authors of the law support and amplify our position is priceless. I want to thank Rep. Speier and all the legislators and public officials who have reached out to us this week. We appreciate you.”
Klemm also praised the grassroots, bi-partisan advocacy efforts from front-line union members. “Our members at United have proven they are tireless defenders of this industry, their passengers, and their fellow union members. What our union does when we are all working together is extraordinary. I want to thank our union’s essential workers, and our AGC’s and elected officers, who are stepping up in an incredible way through this crisis.”
SFO Airport is the proud home of IAMAW District 141 Local Lodges 1781 and 1782.
The full letter is available HERE>
May 3, 2020 | COVID, Featured, Front Page, Home, Home, MNPL, Uncategorized, United |
Senator Josh Hawley issued a warning to United Airlines: use the $5 Billion of CARES Act money to keep your workforce intact… or give the money back.
In a series of Tweets, the Republican Senator from Missouri explained how he was approached by several IAMAW members as he was traveling back to Washington, DC.
“I’m at the airport, flying back to DC, and multiple @United employees have told me the company is cutting their hours, pay & benefits immediately. This is AFTER United took billions in bailout money that was earmarked for workers. This had better not be true.”
Sadly, it is. United Airlines announced plans to slash the pay and benefits of over 15,000 full-time ramp and customer service workers, only days after accepting a huge share of the $50 billion allocated to airlines in the CARES Act. With public demand for air travel decimated since the onset of the coronavirus pandemic, Congress approved several aid programs designed to preserve the American aviation network and its highly skilled workforce. They recognized how important it is to be ready to rebuild quickly once the pandemic has subsided. Congress and the president made a choice to provide funding to safeguard civil aviation in the US, rather than try to recreate it later.
“Airline workers are highly skilled, and irreplaceable without significant training,” said Mike Klemm, President and Directing General Chair of District 141 of the International Association of Machinists and Aerospace Workers. The IAMAW is the largest union of airline and aerospace workers in the world. “These women and men must pass rigorous training and safety requirements when hired, and must maintain and update their skills and clearances regularly. This process requires a significant investment from the air carriers and workers. You can’t just hire people who can operate on and around aircraft and passengers on a whim. Qualified candidates must be identified, trained, and cultivated over the years to build up expertise. The skill and dedication of airline workers are the reasons our aviation system is as safe and resilient as it is.”
Congress agreed and set aside a huge chunk of the $2 Trillion CARES Act to safeguard the civil aviation infrastructure in the US and the women and men who operate it, throughout the COVID Pandemic. “The costs of rebuilding our transportation networks will be much higher than to simply unpause it,” Klemm said.
Lawmakers who drafted and passed the CARES Act and its sister bill, the Paycheck Protection Act, have learned about United’s actions over the weekend. They are not happy. And, they are increasingly threatening to take action.
The outrage over United executives’ actions is bipartisan. Representatives from both major parties and both federal legislative bodies have sent statements of support for Machinists Union members who will be hurt by this decision.
Last week, US Representative Sheila Jackson-Lee wrote a letter to IAMAW District President Mike Klemm where she clearly stated the CARES Act money was not meant to buy new aircraft, buy back stocks, pay out bonuses or for any other purpose than to be distributed directly to United workers impacted by COVID-19. “ “It was not the intent of Congress for this program to be used as an economic bail-out, but to support the hard-working men and women who are the focus of United Airlines,” she said.
IAMAW District 141 Legislative Director Dave Roderick credited the grassroots work of union members for getting the attention of lawmakers such as Jackson-Lee and Hawley. But, he stressed there is much more work to be done. “Our union is ramp and customer service agents – and a lot of other airline workers who love our jobs, and we want to keep them,” Roderick said. “Keeping our jobs right now means getting to work. It means calling our representatives, and making sure they understand just how shady United management is being. It means making sure that lawmakers know that we love our company, and the work we do. It means asking them to insist that company executives keep their word.”
Read the official letter from Senator Josh Hawley to United executives:
United cuts workers hours after taking bailout money
“The cuts are going to be as steep as ten hours a week,” said Victor Hernandez, assistant general chairman with IAM.
Scot Kirby says, "No Hub is sacred" after cuts.
Apr 23, 2020 | COVID, Featured, Front Page, Home, Home, MNPL, Safety, Safety, Uncategorized |
The International Association of Machinists and Aerospace Workers (IAM) today demanded that Delta Air Lines and JetBlue Airways, who received taxpayer-funded federal funds, reverse course and restore airline workers’ pay.
“The payroll support component for air carriers in the CARES Act requires that taxpayer-funded grant dollars be used to maintain the pay and benefits of the dedicated JetBlue and Delta workers who have made your airlines successful and who are risking their lives every day by providing essential services to the American public,” said IAM District 141 and 142 Presidents Mike Klemm and Dave Supplee in a letter to the two airlines’ CEOs. “It is our understanding that tens of thousands of Delta and JetBlue workers have taken unpaid voluntary leaves in order to aid the carriers in reducing labor costs, yet you have implemented unconscionable policies to reduce the pay of those workers that remain. At Delta, thousands of workers are being forced to work fewer hours per week without pay. At JetBlue, workers have been forced to take 24 days of unpaid leave from now until September 30, 2020. The grant money that you demanded and received was calculated using these workers’ compensation and is meant to maintain their salaries and benefits through this crisis.”
Both Delta Air Lines and JetBlue Airways applied for and received direct, taxpayer-funded federal grants under the CARES Act. As a condition of taking the direct grant federal funds, air carriers are prohibited from cutting airline workers’ pay and benefits and from laying off workers until September 30, 2020.
“Hundreds of thousands of IAM members in every sector of our union proudly called elected officials and demanded action to protect the industries in which we work,” continued Klemm and Supplee. “Now, opportunist corporate actors such as yourselves are using that good faith support of airline workers around the country and at every carrier to screw your own workforces and greedily undermine the intent of the federal stimulus funds that you demanded.”
READ THE ENTIRE LETTER HERE. The IAM is the world’s largest airline union and represents over 600,000 members. More information about the IAM and our campaigns to organize Delta and JetBlue workers is available at www.iamdelta.net, www.iamjetblue.com and IAMDeltaworkersunite.
