After Sixteen Senate Republicans on Wednesday called on congressional leaders to extend a program that provides money to support airlines’ payrolls in exchange for prohibiting them from laying off employees during the coronavirus pandemic.
President Donald Trump has endorsed extending federal airline payroll grants, which are set to expire at the end of September.
President in his speech during a press briefing said: “We don’t want to lose our airlines, If they’re looking at extending the grants, whether they’re Republican or Democrat, I’d be certainly in favor. We can’t lose our transportation system.”
Congress awarded U.S. passenger airlines $25 billion in payroll assistance in the Cares Act. Cargo carriers received $4 billion, and $3 billion went toward payrolls of contracting companies that service airlines with ground workers, such as baggage handlers and cabin cleaners.
The grants came with the stipulation that carriers cannot lay off workers until Oct. 1.
With air transportation demand still down approximately 75% from 2019 levels, airlines in recent weeks have warned of another mass layoffs once October arrives. United issued warn notices to 36,000 workers, and American issued warn notices to 25,000 workers.
Smaller carriers also are preparing for layoffs. Alaska, for example, has put out warn notices to 4,200 employees. Regional carrier Republic has put out 2,500 warn notices.
Carriers expect their eventual layoff and furlough figures to be lower than those numbers, mostly due to voluntary departure packages they are offering. Still, airline unions have pointed to the specter of mass staffing cuts in recent weeks as they’ve lobbied for an extension of payroll support through March.
Trump’s remark on Wednesday was the latest sign that the unions’ efforts could pay off. Earlier in the day, 16 Republican senators signed a letter endorsing a clean extension of the payroll support program. Last week, 223 of the House’s 435 members signed off on a similar letter, warning of hundreds of thousands of furloughs or firing on Oct. 1.
The letter was signed by Sen. Cory Gardner (R-Colo.), and Sen. Roger Wicker (R-Miss.), who chairs the committee that is responsibile for aviation.
Treasury Secretary Steven Mnuchin has called the payroll support programme one of the most successful elements of the US economic response to the COVID-19 pandemic.