WASHINGTON, D.C. (April 1, 2020) — Unions representing 100,000 Flight Attendants across the U.S. aviation industry today sent a letter to Treasury Secretary Steve Mnuchin demanding he not exercise warrants on the CARES Act payroll grants that were designed to keep aviation workers on the job. The letter from AFA International President Sara Nelson, representing Flight Attendants at 20 airlines, APFA National President Julie Hedrick, representing American Airlines Flight Attendants, and TWU 556 President Lyn Montgomery, representing Southwest Flight Attendants, reads in part:
TAKE ACTION: Tell Secretary Mnuchin: You Can't Leverage People!
“The CARES Act ensures that pilots, flight attendants, gate agents, ramp workers, and mechanics, as well as airline caterers, cleaners, and wheelchair attendants, will continue to receive a paycheck and benefits. It keeps our entire industry out of the unemployment line, on the tax rolls, on our health care, and on the job so that we’re ready to fly and get the American economy moving again as soon as the “all clear” sounds.
“While the payroll grants program proudly puts workers first, an eleventh-hour provision snuck into the bill threatens whether workers will ever see the promised relief. It gives the Secretary the authority to take ownership stakes in the airlines in exchange for any funds that keep workers on payroll (Sec. 4117). If the airlines were required to pay back the grants in full with an equity position of $25 billion, that would give the government the equivalent of a 40% stake in airlines in exchange for keeping workers on the payroll for six months. This effectively renders the payroll grants a poison pill that will cost us our jobs and push us onto taxpayer-funded unemployment insurance - the opposite of what this bipartisan agreement intended.
“Aviation workers are taxpayers. We believe that when the public steps in to keep companies afloat, the public deserves a share of corporate profits. That’s why we support the inclusion of warrants on the loans carriers can receive. But these payroll grants are different. They’re not loans to help replenish corporate coffers, and they can’t be spent on general business purposes. They’re a direct pass-through to workers. Like the forgivable loans Congress created in the CARES Act for small business owners, the purpose of the payroll grants is to give employers an incentive to keep their workers on payroll.”
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