Labor’s Plan Puts Workers First with Jobs and Paychecks
March 26, 2020
An Op-Ed by AFA President Sara Nelson
March 23, 2020 — The Coronavirus pandemic shut down nearly our entire economy overnight.
We must act quickly, with solutions as bold and unprecedented as the crisis we face—solutions that attack the root of the economic danger for working people like the Flight Attendants I represent.
We built a relief package that is centered on workers and built from the ground up. It directs government aid to keep people in their jobs, getting their paychecks, and connected to healthcare. It's a historic and fundamentally different approach. Never before have we required grants to go directly to the workers, directly back to the taxpayers. We need money for payroll to go straight to workers on the frontlines, not through executives to line their own pockets.
We need solutions that deliver for American workers and match the scale of the problems we face. Congress should start by adopting our plan. Keep as many people as possible in their job and out of the unemployment lines.
Yesterday, the President of the Federal Reserve Bank of St. Louis predicted that the unemployment rate could reach as high as 30% by the second quarter as companies nationwide begin shedding workers in response to flagging demand. That’s an astonishingly high jobless rate, a full 5% higher than the all-time high unemployment rate of 24.9% in 1933, at the height of the Great Depression.
During a typical recession we rely on a combination of unemployment insurance and stimulus checks to jumpstart demand and provide some income replacement for those who are out of work. But this is not a typical recession. The sharp slow-down in economic growth we are seeing is planned, the direct result of state and local officials’ decision to shutter businesses and encourage Americans to stay home and isolate themselves to slow the spread of COVID-19. The more we isolate, the more likely we are to “flatten the curve,” keeping the number of deaths down and ensuring that our country’s health care infrastructure is not further overwhelmed.
The measures to combat the pandemic require a fundamental reordering of American life: abandoning travel plans, canceling concerts and sporting events, and shuttering bars and restaurants. The typical goal of an economic stimulus -- to generate spending activity -- is crashing into the non-negotiable steps that will hopefully cause the pandemic to subside. Even if people have a little more money to spend, they can’t buy airline tickets, go to the movies, or take their family to dinner.
Our focus must not only be on stimulus in the short-term, but also ensuring rapid economic activity when American life returns to normal. Keeping workers on the payroll will shave critical weeks, months, and even years off the recovery time. This is particularly true in the airline industry since aviation workers have to pass background checks and attend training for safety qualifications. If these certifications lapse, the airlines will be slow to restart and other industries will be too. Travel to business conferences, Disneyland, cruises, and casinos is all dependent on a functioning aviation industry.
That’s why last week we proposed a plan to tie any taxpayer relief for the airline industry to the taxpayers themselves. Airlines executives have no choice but to direct the federal money to payroll and benefits at 100% until the threat of the virus is contained. This would be historic because it’s a stimulus that’s built from the ground up, but we won’t be alone in this approach.
Last week the Danish government announced that it would cover salaries at private companies as long as the companies didn’t fire workers. The UK adopted a similar approach shortly thereafter. Under the Danish model, companies who are planning to lay off 30% of workers, or fire at least 50 people, file a notice with the state, who then steps in with assistance to the company to cover 75% of workers’ salaries, up to $3,288 a month. This preserve precious government resources to focus on fighting the virus rather than becoming the HR solution for the whole country. With the aviation industry as an example, the government need only interface with a few dozen employers, instead of managing unemployment claims of a million people.
America should never repeat the Bank Bailouts of 2008. In the midst of this crisis, we have one chance to do something fundamentally different: to put workers first. A workers first package puts an end to stock buybacks, stops executive bonuses and dividends, and comes with strong oversight and real penalties to make sure companies play by the rules. By building a relief package from the ground up, we can keep payroll flowing to the workers who keep our planes in the air. This is our chance to chart a different course. Let's put workers first.
Sara Nelson is the international president of the Association of Flight Attendants, which represents 50,000 flight attendants across 20 airlines.