Exhibit 99.1
Special Jetwire – A Message from Doug Parker and Robert Isom
Dear fellow team members,
Today, we will begin issuing Worker Adjustment and Retraining Notification (WARN) letters to our unions and represented team members in some states. These are notices the company is required by law to provide in advance of potential layoffs or furloughs. In our case, the WARN notices are tied to the overages we may see starting Oct. 1 when our Payroll Support Program funding expires.
We hate taking this step, as we know the impact it has on our hardworking team members. From the time the CARES Act was signed in March, we had a stated goal of avoiding furloughs because we believed demand for air travel would steadily rebound by Oct. 1 as the impact of COVID-19 dissipated. That unfortunately has not been the case. Our passenger revenues in June, while we believe are better than others in the industry, were more than 80% lower than June 2019. And with infection rates increasing and several states reestablishing quarantine restrictions, demand for air travel is slowing again.
As a result, we currently anticipate having over 20,000 more team members on payroll than we will need to operate our smaller schedule this fall. For our Airports and Tech Ops teams, we are also accounting for displacements that could occur as team members shift to other locations, so those potentially impacted individuals are also included in the WARN process. Using those guidelines, we will issue WARN notices to approximately 25,000 team members. You can find workgroup details and a Q&A on Jetnet.
Please know that while we are issuing 25,000 WARN notices, we hope to reduce the actual number of furloughs significantly through enhanced leave and early-out programs for represented workgroups, which we are announcing today. These programs were created with input from our union partners and are open to frontline represented team members, excluding pilots. Pilots are in a different situation given their mandatory retirement age and required training cycles as they move across aircraft, so they have separate leave and early-out programs tailored to their circumstances.
The voluntary programs we are rolling out today for frontline represented workgroups:
Extended leaves of 15, 18 or 24 months that provide continued medical coverage at active rates, continued non-rev travel privileges and partial pay for certain eligible team members.
An enhanced early-out offering for team members with at least 10 years of occupational seniority. This program includes up to $150,000 in a Retiree Health Reimbursement Arrangement for 65-point plan retirement-eligible team members, as well as some positive space travel.
We have also introduced a new early-out program for team members who have less than 10 years of occupational seniority that will provide continuation of active medical coverage and non-rev travel privileges for a period of time.
Full details on the voluntary programs are available on Jetnet.
