A Southwest Airlines Boeing 737-700 (LN2318) on final-approach after a pre-delivery check flight at nightfall.
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Southwest Airlines pilots’ union is pushing again on an organization proposal to cut pay by 10% to keep away from furloughs via the top of subsequent 12 months, the most recent wrinkle within the service’s efforts to cut prices within the pandemic.
Southwest is making an attempt to protect its report of by no means having furloughed employees in its almost 50 years of flying, however CEO Gary Kelly warned earlier this month that it might search concessions from the labor unions that make up the majority of its workforce.
“Our goal is to protect every pilot job so we can be prepared to take advantage of revenue opportunities when customer demand returns,” Southwest stated in a press release. “Until then, we must also begin to restore our balance sheet by more closely aligning our loss in revenue with lower costs.”
All U.S. airways are scuffling with a plunge in income from the sharp drop in journey demand due to the virus. In the primary 10 days of the month, the Transportation Security Administration screened a median of 804,302 individuals a day, down almost 66% from a 12 months in the past.
On Friday, Southwest proposed the 10% pay price cut to its roughly 9,000 pilots. The union, the Southwest Airlines Pilots Association, took concern with the across-the-board discount and pressure majeure clauses, which it feared the airline may lean on to furlough pilots anyway.
“This addition would not protect us from furloughs or ensure us that our hourly trip rates would snap back after the term of any agreement,” the union stated in a memo to members.
The union pointed to different choices like voluntary time without work at decreased pay and early retirement packages.
“We have a revenue and short-term cash problem that cannot be fixed by concessions alone,” the union stated in a memo on Friday. Its president Jon Weaks, advised CNBC the corporate’s proposal is “dead on arrival” however that the union is open to additional talks on cost-cutting measures.
The dispute comes as rivals American Airlines and United Airlines earlier this month started reducing greater than 30,000 jobs after the phrases of billions in federal assist expired. Southwest would not plan to furlough employees this 12 months however stated earlier this month it might search concessions from unions for a dedication to maintain jobs via 2021.
United Airlines pilots agreed to scale back minimal hours with a view to forestall shut to three,000 furloughs deliberate this 12 months.