Thousands of airline workers could lose their jobs this week if lawmakers are unable to get closer to resolving disputes that have stymied negotiations over broad coronavirus relief for months.
Airlines agreed last spring not to lay off or furlough any workers until Oct. 1 as a condition of a $25 billion infusion of federal aid. Now, barring a last-minute agreement on how much to spend on a pandemic relief package for the country, more than 30,000 airline workers are set to be furloughed Thursday.
House Speaker Nancy Pelosi (D., Calif) and Treasury Secretary Steven Mnuchin emerged from a 90-minute meeting Wednesday without a deal on economic-aid legislation that could include airline funds. House Democrats will vote on a $2.2 trillion coronavirus aid package late Wednesday that includes over $25 billion in funds to continue covering airline salaries for six months.
That legislation has no chance of advancing in the GOP-controlled Senate. Many Republicans have also said they favor more aid for airlines, but they want to significantly reduce the price tag of the overall aid package.
Mr. Mnuchin and Mrs. Pelosi said they will continue to work toward an agreement, but it’s not clear whether that will be enough to persuade airlines to delay their plans.
The Treasury secretary said Wednesday at CNBC’s Delivering Alpha Summit that he had spoken with the top airline executives and hoped they would delay job cuts if a deal was under way.
Speaking on CNN shortly after those remarks, American Airlines Group Inc. Chief Executive Doug Parker said he would be open to postponing, but only if there is a “clear and concrete path” toward an agreement.
Airlines have raised billions of dollars from capital markets and in some cases from additional government loans and are in little danger of imminently running out of money. But they say they don’t want to pay workers they don’t need while they are burning through millions of dollars a day and flying a fraction of their usual schedules.
While air-travel demand has climbed from the depths it reached in April, it remains nearly 70% lower than a year ago. Analysts forecast that U.S. airlines will lose $30 billion this year, according to FactSet data.
Several airlines have whittled down the number of jobs they plan to cut, offering buyout and early-retirement offers and striking deals with unions to cut costs. Some, including Southwest Airlines Co., aren’t planning any furloughs at all this week, though they have warned they might not be able to avoid them indefinitely without aid.
American and United Airlines Holdings Inc. account for the bulk of the job cuts scheduled for this week. American has said it would furlough or lay off 19,000 workers on Thursday unless it receives more aid. United, which initially warned 36,000 workers that their jobs were at risk, said this week that it plans to furlough fewer than 12,000. The airline and its pilot union struck a deal to delay any furloughs of pilots until June.
With time running short, some attention is turning to a pair of bills in the House and Senate that would focus solely on aid for the aviation industry. Aviation unions wrote to congressional leaders Tuesday night, asking that Congress pass a stand-alone aviation bill if agreement on a broad relief package can’t be reached Wednesday.
Those efforts also face challenges, and Mr. Mnuchin said Wednesday he didn’t expect lawmakers to move forward with airline-focused legislation. Democrats have been reluctant to pass piecemeal bills that just help one sector of the economy, though several have signed on to co-sponsor the airline bills.
Sen. Rick Scott (R., Fla.) proposed amending such legislation to bar airlines that take aid from furloughing workers for five years—something he said is needed to protect workers longer term. Some industry officials described the proposal as a “poison pill.”
“We already gave airlines billions of dollars in taxpayer money,” Mr. Scott said.
For workers, the last-minute wrangling adds to months of uncertainty about their futures. “I’m scared,” said Leo Valladares, a flight attendant set to be furloughed this week. The coronavirus outbreak in Asia was barely on his radar when he began training in February after two years with a smaller carrier. Now he is faced with spending down his savings as he looks for work. “I thought it was going to be a steady job,” he said.
Write to Alison Sider at alison.sider@wsj.com
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