American, United move ahead with more than 32,000 furloughs, but will recall workers if cornoavirus aid deal reached

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An airline employee walks past empty American Airlines check-in terminals at Ronald Reagan Washington National Airport in Arlington, Virginia, on May 12, 2020.

Andrew Caballero-Reynolds | Getty Images

American Airlines will move ahead with plans to furlough 19,000 workers on Thursday after talks for a national coronavirus aid package failed in Washington, but the airline is prepared to reverse course if a deal is reached, its CEO said.

The terms of $25 billion in federal payroll support Congress passed for the ailing sector in March prohibit airlines from cutting jobs until Oct. 1. The aid was meant to help airlines cope with a sharp drop in bookings until there was a significant recovery in demand, which hasn’t materialized.

Airlines spend the last several months urging lawmakers for another $25 billion, a proposal that has won bipartisan support. However, talks for a broad coronavirus package that would include another round of airline aid faltered on Wednesday, opening the door to more than 30,000 job cuts, starting Thursday, the lion’s share of them at American and United Airlines.

While House Speaker Nancy Pelosi and Treasury Secretary Steven Mnuchin failed to reach a deal earlier Wednesday but talks are set to continue.

This is breaking news. Check back for updates.

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