A leaked internal memo reveals that United Airlines is offering its employees special benefits if they decide to leave their jobs at the airline. The memo, leaked by Business Insider yesterday, was sent to management and administrative (M&A) employees. What are these benefits and could they be enough to encourage some workers to resign? Let’s find out.
Airline workforces are shrinking
It’s no surprise that airlines around the world are looking to reduce their respective workforces. With the steep drop in demand and reductions in flights, there are now tens of thousands of employees across the aviation industry who are no longer needed in their current positions. In fact, we found out very recently that Air Canada has plans to cut its workforce by at least 50% – shedding approximately 20,000 jobs in the weeks to come. Closer to home, Delta Air Lines is also warning its employees to expect layoffs later this year.
United Airlines finds itself in a similar situation and has been encouraging its employees to accept voluntary separation packages. According to Live and Let’s Fly, the number of workers taking these packages has been limited.
Incentives added to separation packages
According to Business Insider, which shared the leaked memo, several new incentives have been put on the table to convince employees to take an early leave. Here’s what’s being offered by United:
- Those who accept the voluntary separation offer will end work in June but be considered employed and on leave through December 1, 2020.
- Full pay will be issued through June 30, 2020. This decreases to 33% pay between July 1 and November 30.
- Employer-subsidized healthcare benefits will remain through November 30
Further sweetening the deal, those who accept the offer will also receive the following from the airline:
- 250,000 MileagePlus miles
- Top-tier (1K) frequent flyer status (validity period unknown)
- Five years of active employee travel benefits
- After the five years, this changes to retiree travel benefits
- Priority access to job postings if and when the situation improves at the carrier
United Airlines tells us that new voluntary separation programs would be introduced soon, and rolled out this week. They add,
“We are providing our employees with multiple options so that they can make the decision that’s right for them. Already tens of thousands of United employees, in an extraordinary show of loyalty to the company, have voluntarily agreed to unpaid leaves because they want to help the company survive the crisis.”
It’s difficult for us to say if this is a deal worth accepting. As some point out, what’s the purpose of having frequent flyer status when you don’t have the money to pay for flights? Of course, being paid 33% of your salary while being free to seek other employment could be highly beneficial to those who might be lucky enough to find work elsewhere.
United’s M&A employees will have to take some time to consider what is best for them and their families while also evaluating how long this crisis will drag on. Without a doubt, some hard decisions will have to be made.
If you were working at United and received this offer, do you think you would take it? Let us know in the comments.