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“We have already said that early retirements alone will not solve the pilot overstaffing situation caused by the Covid-19 pandemic,” said John Laughter, senior vice president of flight operations, in an internal memo to employees. Delta (OF) provided the note to CNN Business.
According to Laughs, the company might be able to “avoid or reduce” time off if cost-cutting agreements can be made with their union and the CARES Act is extended.
“While this is possible, it is far from certain and we must continue to take the necessary steps to run the business. It is vitally important to the Delta takeover that we reduce our size given the long and uncertain road ahead, ”he said.
The federal bailout known as the CARES Act will expire at the end of September. The bailout banned the airline industry from employee layoffs, involuntary leaves or pay cuts. Delta received $ 5.4 billion in grants and unsecured loans from the CARES Act, according to an SEC filing.
The airline currently has 11,200 active pilots, according to the memo. According to him, the company will need around 9,450 pilots for the summer 2021 program, which he says should be the peak flight period for next year.
Delta warned employees in May of possible employee cuts.
“We’re just overstaffed and faced with an incredibly difficult decision,” said Laughter.
Along with other airlines, Delta urged employees to take advantage of the buy-back and voluntary exit programs, one that included a retirement program for employees who have worked at Delta for more than 25 years. Although employees opted for these programs, Laughter noted that this was not enough to prevent time off.
Since the pandemic hit, Delta says only 25% of revenue has been recovered.
“While we expect a recovery over several years, we will work diligently to get you back to Delta as soon as possible, if demand recovers better than we expected,” Laughter said.
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