American Airlines plans 30% reduction of management, administrative staff

American Airlines is planning to cut 30% of its management and support staff, a reduction of about 5,000 jobs, because of the toll coronavirus is taking on the business, the company told employees Wednesday. The airline also started offering buyouts to these employees and said it plans to offer new voluntary leave and buyouts for frontline staff, such as flight attendants, next month, according to a company memo that was viewed by CNBC. “Although our pre-pandemic liquidity, the significant financial assistance provided by the government, and the cash we’ve raised in the capital markets provide a foundation for stability, we need to reduce our cost structure, including our most significant expense — the cost of compensation and benefits,” Elise Eberwein, American’s executive VP of people and global engagement, said in the staff note. “Additionally, running a smaller airline means we will need a management and support staff team that is roughly 30% leaner,” Eberwein wrote. Management and support staff will have until the end of June 10 to apply for the buyout and American is offering volunteers a third of their pay through the end of 2020 and five years of travel privileges. Employees that are laid off after Oct. 1 will not receive a severance, according to another company memo. American had about 130,000 employees as of the end of 2019 and so far, about 39,000 have taken voluntary leaves or early retirement.<br/>