Lawmakers Press Airlines to Protect Workers, Travelers
May 06 2020 - 6:44PM
Dow Jones News
By Alison Sider
Lawmakers who bailed out U.S. airlines want to make sure the
government gets what it paid for.
In letters and at a subcommittee hearing on Wednesday, some
members of Congress questioned whether airlines are complying with
rules around retaining workers in exchange for federal aid and how
carriers are protecting passengers amid the coronavirus
pandemic.
The Cares Act, the $2.2 trillion stimulus bill that included $25
billion in grants and loans for passenger airlines to use to cover
payroll costs, comes with conditions, including that airlines not
involuntarily furlough workers or cut pay rates through the end of
September.
With fewer flights operating and less work to go around,
airlines including United Airlines Holdings Inc., Delta Air Lines
Inc. and JetBlue Airways Corp., had moved to reduce schedules for
some workers.
Sen. Maria Cantwell (D, Wash.) said Congress didn't intend to
allow airlines that accepted the aid to cut workers' hours in an
effort to save money. "This is counter to what the legislation
entailed," she said.
The lawmakers' criticisms highlight the complicated new dynamics
between airlines and the government, and the burden of having
accepted taxpayer money. Airlines have faced huge losses and are
burning through some $10 billion in cash a month as air travel
demand has dwindled to its lowest level since the 1950s.
Earlier Wednesday United backed away from its plan to cut its
fleet and passenger workers' schedules to 30 hours a week, after
the union that represents those workers filed a federal lawsuit in
New York. United said that the suit is meritless and that it still
believes the reductions are allowed under the law, but that it
would make the reduction voluntary for now.
The airlines have said federal funding covers only about
three-quarters of their payroll costs, and that the law only
specifies that airlines cannot cut pay rates. Some have warned that
furloughs and layoffs are likely in October once the government
funding runs out.
Nick Calio, chief executive of trade association Airlines for
America, said airlines are looking for relief from another of the
stimulus provisions, that carriers maintain service to all the
cities in their networks. Airlines have said the requirements force
them to fly empty flights on routes where there's hardly any
demand.
Lawmakers also questioned whether airlines are doing enough to
protect passengers from the spread of the virus. Some suggested at
the hearing that there should be federal guidelines requiring
distance between passengers on planes.
Several airlines are blocking middle seats or capping how much
of a plane they fill while concerns about contagion remain high,
but they've said that isn't something they can afford to do
forever.
"I think a rule put in place is not necessary at this time," Mr.
Calio said.
Lawmakers criticized Frontier Airlines for a new offering,
allowing passengers to pay an extra $39 to keep an empty seat open
next to them.
"I don't think it's appropriate for some passengers who can't
afford to pay an additional charge for a seat to be less safe than
other travelers, " Sen. Amy Klobuchar (D, Minn.) said.
Frontier Chief Executive Barry Biffle said in an interview
earlier this week that the airline doesn't believe empty middle
seats are a safety necessity as long as passengers and crew are
wearing masks, but that the airline is offering the option to
purchase another seat at reduced charge to give passengers peace of
mind.
Write to Alison Sider at alison.sider@wsj.com
(END) Dow Jones Newswires
May 06, 2020 18:29 ET (22:29 GMT)
Copyright (c) 2020 Dow Jones & Company, Inc.
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