Expect 50% pay cuts next week
Everyone,
With all the news and reduction in flying, emergency measures have to be taken. Cash burn is going to kill off the industry, and the government bailout will be too slow to save us if things remain status quo. United has 75-80 days of cash.
As such, I expect the following in the next few days:
1) Massive surplus reduction lines in the neighborhood of 40% of pilots
2) 50% pay cuts on top of those. You won’t get a vote.
3) Furlough announcement of 20-30% of all employees.
The break even on pilot furloughs is one year.
These measures are all preferable to a Chapter 11 Bankruptcy filing, but they might take it into CH11 anyhow so they can renegotiate all of our lucrative union contracts.
After 9/11, flying was halted for three days, and everyone besides SWA and AA was driven into Chapter 11. Management will ensure the survival of the corporation first, but once they have accomplished that they will also find a way to screw the employees.
The government will give us money this time, but not without the unions getting crushed in the process. They wouldn’t give us a $2.1B loan guarantee in 2004, which led to the dissolution of the pensions and another $1.5B in pilot givebacks, but they had no problem giving AIG a $120B bailout four years later.
They (AIG, Merrill Lynch, etc.) then gave themselves bonuses with government money. For the banks and Wall Street, no problem. Unions? Take a number.
Get ready. It’s coming.
Last edited by Big John; 03-16-2020 at 01:18 AM.