A United Airlines employee based in Chicago has accused the airline of violating the conditions of its $5 billion paycheck assistance by mandating staff to take off 20 unpaid work days, a new class action lawsuit reveals.
Shift manager Kenneth England, assigned at O'Hare International Airport, alleges in the complaint that just two weeks after the airline agreed to the terms of the funding arrangement, United told management and administration personnel, or 'M&A staff,' that beginning between May 16 and September 30, domestic M&A workers will be required to take 20 days off without pay, a copy of the report disclosed.
In April this year, the airline was granted almost $5 billion in federal financial assistance aimed at supporting payroll during the pandemic crisis. Airline companies have been severely affected by the widespread lockdown, which has caused global travel to plunge to near-zero.
The US government responded with $50 billion in funding for the airline sector, but the bailout program came with the condition that companies would implement no layoffs until end of September.
The charges filed here is similar to one filed by labor groups to reverse the same cuts in work hours and related pay reductions announced on May 4. While the unions successfully made an agreement to have the cuts reversed for members, the Management and Administration staff are not covered by a collective bargaining deal and did not see relief from those arrangements.
Shares of United Airlines settled down over 3 percent late Thursday and retreated 12 percent earlier in the session, as the company's struggles continue to rise. Shares weakened for a day for most of the airlines, but United continues to underperform.
State assistance provides a combination of cash and loans, with the government obtaining warrants that can be turned into small ownership shares in major airline companies. The $5 billion was a part of the $25 billion in state aid that were allocated to the country's biggest carriers which was intended to compensate staff and prevent industry layoffs.
England, a non-union employee, filed the complaint on Wednesday through legal counsels and asked that it be granted class action classification. A United Airlines spokesperson described the lawsuit as without merit and stated the airline has continued to employ 100 percent of its staff.
Since March this year, United has been transparent with personnel that it expects to reduce its staff once the restrictions expire. The lawsuit, filed in U.S. District Court, alleges that the company is not adhering to the US Treasury's policies by cutting the hours worked ahead of the Sept. 30 target date.
