In the months after Congress allocated of hundreds of millions of dollars to keep airline industry employees working, passenger airlines applied for shares of that money and then then laid off less than 1% of their workers, until the funding ran out.
Airline contractors similarly applied for money and then laid off about 58,000 people, about 35% of their workers, a new report says.
“Contrary to congressional intent, Treasury permitted aviation contractors to lay off thousands of workers and receive full payroll support calculated based on the companies’ pre-pandemic workforce,” according to a report, released Friday by the House Select Subcommittee on the Coronavirus Crisis.
The report, “Unnecessary Costs: How the Trump Administration Allowed Thousands of Aviation Workers to Lose Their Jobs,” was issued by the House Select Subcommittee on the Coronavirus Crisis.
It blasted both the slow pace of work by the Treasury Department and airport contractors’ allocation of the funds they received.
“This staff report documents how the Department of the Treasury’s implementation of the Payroll Support Program (PSP) caused thousands of workers at aviation contractors to lose their jobs,” said the introduction to the report.
“Documents uncovered during the Select Subcommittee’s investigation show that aviation contractors sought to avoid ‘unnecessary costs’ by terminating employees before executing PSP agreements,” the introduction continued.
In comparison with passenger airlines, “Aviation contractors reported conducting 57,833 layoffs and furloughs prior to applying for PSP assistance—more than 17 times the number reported by passenger air carriers,” the report said.
The Cares Act was approved by Congress on March 27. The report makes a distinction between the 57,833 layoffs and furloughs before PSP applications were filed under the act, and the16,655 layoffs between