U.S. AIRLINES CONTINUE TO OFFSHORE JOBS DESPITE ACCEPTING BILLIONS IN TAXPAYER BAILOUT FUNDS
Perhaps no industry has been hit harder by the coronavirus than the airline industry, but that industry has also received more governmental – meaning taxpayer – largesse than just about any other business sector, both historically and recently in response to the pandemic. Just last week, with Congress stalled on another package of economic support for unemployed workers and crippled small businesses, the President’s Chief of Staff reached out to Senate Democrats to restart talks over a big new airline bailout, threatening that the President is “weighing executive action to avoid massive layoffs” in the industry by giving cash to the airlines without congressional authorization if Democrats don’t get on board.
And yet, the very next day after the administration’s renewed bailout outreach, United Airlines announced hiring plans to fill a series of job openings – but in India, not here at home. Moreover, its plans do not reflect the normal offshoring of call c
enter or customer service operations – no, United is looking to fill high-level positions such as senior analyst – network planning, senior analyst – revenue strategy, senior manager – sales programs, and manager – revenue strategy. And to underscore the cost-saving motivation driving this move, the company announced it will not consider transferring U.S. employees to India to fill those positions, even if such employees are willing to uproot and move around the world.
The unpatriotic gall of this latest outrage by Corporate America is impossible to overstate. Earlier this year, United received from the government – again, meaning taxpayers – almost $5 billion in payroll support funds to “save U.S. jobs,” and it has lobbied for another $5 billion as a “clean extension of the CARES Act.” Because it accepted CARES Act payroll grants, United cannot legally terminate employees (union or non-union) until October 1, but it has already told swaths of employees they will lose their jobs as soon as that restriction ends and induced many to accept severance packages rather than await termination.
This latest move, however, raises the hypocrisy meter to unprecedented levels. United is essentially asking U.S. taxpayers to continue to subsidize jobs the company has no intention of filling in the United States. And not just call center or customer service jobs, but managerial positions traditionally paying healthy salaries and offering advancement opportunities.
Nor is United alone among airlines which continue to offshore U.S. jobs despite receiving gobs of federal funding. Earlier this month, American Airlines warned 10,000 crew members based in the United States they would be furloughed in October when federal payroll support (and its resulting restrictions) terminates. The flight attendants’ union promptly accused American of offshoring those jobs to cheaper labor in Latin America, noting that the company did not threaten layoffs to foreign flight attendants who earn lower wages.
American’s offshoring of flight attendant positions traces back to its acquisition of Eastern Airlines’ Central and South American routes in 1989. The purchase included foreign-based crews employed by Eastern, which caused the flight attendants’ union to attempt (unsuccessfully) to block the deal.
More recently, in 2018 the transport workers’ union accused American of offshoring U.S. jobs by performing nearly 50% (by value) of maintenance work on U.S.-registered aircraft at foreign maintenance facilities. The union promptly branded the airline “UnAmerican Airlines” as part of its campaign to repatriate maintenance jobs back to America.
Shady business practices targeting consumers are not unusual in the airline industry. Just last week, United announced a new program to cancel flights that have not booked enough passengers. Under that program, United will inform affected customers just 18 to 24 hours prior to departure that they will be traveling on different flights at earlier or later times, with almost 25% of the new arrival times expected to exceed four hours difference from the original schedule.
In almost any other business, selling a service at a specific advertised time, only to cancel for reasons entirely within the provider’s control – and for its own, exclusive benefit of cutting costs – would be condemned as an unfair and deceptive practice, i.e., consumer fraud. For airlines, however, it appears to be standard operating procedure.
But to continue to offshore American jobs when they are desperately needed – and after receiving billions of dollars in U.S. taxpayer funding and lobbying for billions more – is not merely deceptive. It is but the latest example of unpatriotic hypocrisy by American corporations designed to harm Americans who are sustaining their existence, all for the cause of cutting costs.
Devastated by pandemic-triggered unemployment rates, U.S. workers continue to discover the hard truth about how their corporate bosses (and fellow citizens) regard them when foreign offshoring will save their businesses a few bucks – if you are not sitting at the table, your jobs are on the menu.
Lauren Irwin-Szostak is the President of Business Processes Redefined, LLC, a call center solutions management firm headquartered in Fairfield, New Jersey which is certified as a woman-owned business enterprise by both the New Jersey Woman-Owned Business Enterprise (NJWBE) and the Woman’s Business Enterprise National Council (WBENC).