Why are bailed-out US airlines cutting their workers’ hours?

© Looman

Part of the $50bn US airline bailout package was made on condition that the carriers maintained their staff payroll until the end of September – a bid to prevent workers claiming unemployment assistance.

However, it appears carriers have decided to ignore that condition, and several, including Delta and United, have cut their staff hours. But politicians have complained to the Treasury, in a letter seen by CNBC, which says: “The creative position held by these airlines is that an hours cut is somehow unrelated to compensation, which is protected under the Cares Act. The hour cuts imposed by these carriers have made some workers eligible for unemployment assistance — a circumstance the legislation was explicitly designed to prevent. These carriers are very clearly out of compliance with the letter and spirit of the law.”

One to watch…