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Law360 (May 21, 2020, 6:27 PM EDT) -- Delta Air Lines and JetBlue should reverse their decisions to cut employees' hours after they received assistance under the Coronavirus Aid, Relief, and Economic Security Act, a group of Democratic and independent senators said Thursday.
The airlines' policies are inconsistent with the intention of the CARES Act and "potentially illegal," according to the senators, who included Democrats Elizabeth Warren of Massachusetts and Sherrod Brown of Ohio along with independent Bernie Sanders of Vermont.
"Your decision to cut employee hours is inconsistent with congressional intent and is a blatant and potentially illegal effort to skirt your requirements to keep workers on payroll, and you should reverse this policy immediately," wrote the senators in the separate letters to Delta CEO Ed Bastian and JetBlue CEO Robin Hayes, which were sent Wednesday but announced Thursday.
The "law is clear" regarding the requirements of companies receiving money under the CARES Act, said the group of 13 senators, which also included Democrats Robert Menendez of New Jersey, Kamala Harris of California and Kirsten Gillibrand of New York.
The section they cited, 4114, outlining the requirements does not explicitly address cuts to hours, but does state that air carriers are prohibited from "conducting involuntary furloughs or from reducing rates of pay and benefits" until Sept. 30.
"When it comes down to what's in an employee's paycheck, reducing hours and cutting pay have the same effect: less money for workers to take care of themselves and their families," the senators wrote. "Your workers supported relief for airlines on the condition that their jobs, pay, and benefits would be protected."
The senators cited reports that Delta has "cut ground crew hours by as much as 40% without consulting with workers" and is planning to slash flight attendant hours. Meanwhile, JetBlue has cut the hours of mechanics, passenger service agents and ramp workers, they added.
Delta and JetBlue received $5.4 million and $935 million in grants from the CARES Act, respectively, the senators said.
JetBlue said in a statement sent to Law360 that it has put in place "a variety of programs with an emphasis on voluntary time off and unpaid leave programs" that are "in full compliance" with the CARES Act requirements.
"The payroll support funds give much-needed relief to keep our crewmembers employed during this period, and we are fairly allocating these dollars using a standard for minimum guaranteed hours that are consistent with union agreements," the statement read.
Delta did not respond to requests seeking comment.
In calling out Delta and JetBlue, the senators pointed to a decision by United Airlines earlier this month to reverse its decision to cut employee hours following a union-led lawsuit, suggesting that Delta and JetBlue follow suit.
United received $5 billion from the program, including an approximately $3.5 billion direct grant and roughly $1.5 billion low-interest-rate loan, a spokesperson confirmed.
The spokesperson shared with Law360 internal emails from Greg Hart, United's chief operations officer, showing that the company did change its position on the hourly cuts five days after the original announcement.
Hart's May 1 email noted that, effective May 24, full-time employees would be reduced to part-time status and have their hours dropped to 30 hours. Alternatively, it stated that they could choose a voluntary layoff, retirement or an option that would allow them to separate from the company while retaining certain travel benefits.
The email applied to roughly 15,000 frontline workers unionized with the International Association of Machinists and Aerospace Workers, including baggage handlers and customer service agents, but excluded management, pilots, flight attendants and others, the spokesperson said.
But on May 5, the day the union filed a lawsuit in federal court, Hart followed up with a memo stating that the hour cuts were strictly optional and that those who chose to participate would retain their full-time status and associated benefits.
--Editing by Jack Karp.
For a reprint of this article, please contact reprints@law360.com.
