Delta expects to write off up to $3.3 billion on buyouts, early retirements

An airport employee guides a Delta Air Lines Airbus A319-100 aircraft on the tarmac at LAX in Los Angeles, California, U.S., January 6, 2020.

Lucy Nicholson | REUTERS

Delta Air Lines mentioned Wednesday it expects to take a cost of as a lot as $3.3 billion from voluntary separation agreements with employees because it seeks to slash its labor invoice due to the coronavirus pandemic.

Delta and different carriers are urging workers to take buyouts and early retirement packages to assist it lower prices with little finish in sight to the pandemic’s influence on air journey. They’re prohibited from laying off staff via Sept. 30 beneath the phrases of a $25 billion federal help package deal to help worker payroll.

Delta’s CEO Ed Bastian mentioned on an earnings name on Tuesday that greater than 17,000 of the Atlanta-based service’s roughly 91,000 workers signed up for the separation packages, which embody money severance, prolonged well being care advantages and free flights. 

In a submitting on Wednesday, Delta mentioned it can file a $2.7 billion to $3.3 billion cost from these packages within the present quarter, with up to $600 million in money funds to volunteers.

“Certain of the programs remain open, and these represent our best estimates based on the employees who have signed up to date,” it mentioned.

United, American and Southwest have provided employees related packages. United final week warned roughly 36,000 workers, almost 40% of its employees, about potential furloughs in October if there aren’t sufficient volunteers. American has instructed its workers it expects to be overstaffed by round 20,000 folks for its lowered schedule this fall.

The Fort Worth-based service is predicted to ship out related warnings to front-line workers like flight attendants, mechanics and pilots, as early as Wednesday, in accordance to folks acquainted with the matter.

WATCH: Full interview with Delta CEO Ed Bastian

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