American, United cancel 27,000 furloughs after stimulus package passes

American's CEO told employees they can "tear up" their furlough notices.

ByMina Kaji
March 10, 2021, 9:34 PM

American Airlines and United Airlines withdrew approximately 27,000 employee furloughs on Wednesday after the House passed its $1.9 trillion COVID-19 relief package that included an extension of the payroll support program.

American CEO Doug Parker and President Robert Isom told employees in a memo on Wednesday that the warnings about furloughs they received in February are "happily canceled -- you can tear them up!"

American and United had warned 13,000 and 14,000 employees, respectively, that they would be furloughed in April if the payroll funding, first included in the Coronavirus Aid, Relief, and Economic Security (CARES) Act wasn't renewed.

PHOTO: American Airlines CEO Doug Parker joins fellow airline executives, union heads and politicians, outside the U.S. Capitol, Sept. 22, 2020, in Washington.
American Airlines CEO Doug Parker joins fellow airline executives, union heads and politicians for a news conference to call on Congress to pass an extension of the Payroll Support Program to save thousands of travel jobs, outside the U.S. Capitol, Sept. 22, 2020, in Washington.
Chip Somodevilla/Getty Images

"By extending PSP, our teams will be able to remain current in their training and ready to match expected future demand," United CEO Scott Kirby said in a statement. "Thousands of frontline workers will now receive paychecks and health care through September, which is especially critical while vaccine distribution continues to ramp up."

To receive a portion of the $15 billion aid, airlines must agree to not furlough workers before Sept. 30.

Although airlines have recently seen promising signs of recovery as vaccines are rolled out, passenger volumes remain down nearly 60% compared with this time last year.

Airlines For America, which represents all major U.S. carriers, estimated passenger airlines are still burning an approximately $150 million of cash per day.

PHOTO: Passengers arrive for American Airlines flights at O'Hare International Airport on Feb. 05, 2021, in Chicago.
Passengers arrive for American Airlines flights at O'Hare International Airport on Feb. 05, 2021, in Chicago.
Scott Olson/Getty Images, FILE

"We appreciate the Administration's work on this legislation, and we urge President Biden to act swiftly to sign the ARP into law," A4A President Nick Calio said in a statement on Wednesday.

On Monday, A4A, along with nearly 30 travel groups urged the Biden administration to develop temporary COVID-19 health credentials that would allow travelers to show digital proof of their coronavirus test results and vaccination status. They believe it would boost passenger confidence and eliminate restrictive quarantines that deter travelers.

"The U.S. must be a leader in this development," the groups wrote in a letter to COVID-19 Recovery Team Coordinator Jeff Zients on Monday. "The current diverse and fragmented digital health credentials used to implement different countries' air travel testing requirements risk causing confusion, reducing compliance, and increasing fraud."

White House press secretary Jen Psaki said the U.S. government's focus is "on getting more people vaccinated" when asked on Tuesday about support for a standardized digital health passport.

The Centers for Disease Control and Prevention has said that even those who've already been vaccinated should avoid traveling.

ABC News' Will Gretsky and Amanda Maile contributed to this report.