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American and Delta Are Preparing for Potentially Massive Layoffs

Posted on the 29 May 2020 by Thiruvenkatam Chinnagounder @tipsclear

In a letter to employees, American said Wednesday that it has to cut about 30% of its management and support staff due to its transition to a smaller airline. In addition to the staff reductions, the Dallas-based company said that involuntary dismissal decisions will be announced in July and that these staff will be on the payroll until September 30.

"A more effective management team starts at the top, and we restructure all levels around future leaders and key positions, starting with our team of officers," said the letter. "We will soon announce the reorganization of a team of officers, and these leaders will restructure to the next levels shortly after."

Delta announced a similar initiative on Thursday, telling employees in a memo obtained by CNN that "a smaller delta unfortunately means fewer people will be needed." The airline dramatically cut its schedule in the spring, but re-established routes in June. However, its second quarter calendar is 85% smaller than the same period last year.

The company offers its employees two voluntary exit programs, including a retirement program for employees who have worked at Delta for more than 25 years. It also offers another buyout that covers most of its 90,000 employees.

In a memo sent to about 11,500 workers, Kate Gebo, head of human resources for United, said that the company's management and administrative staff could be cut by 30% in October after the funding for the company ended. CARES law of the American government.

United revealed earlier this month that 20,000 workers, more than 20% of its workforce, had taken voluntary leave. They also announced that they would offer buyouts and early retirement packages to employees.

-CNN Business' Chris Isidore contributed to this report.

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