Introduction
Labor relations and human resource management are the fields of study that deal with different aspects of relationships between organizations and employees. The presence of strategies to guarantee employee satisfaction and staff retention is specifically important in the airline sector of the aviation industry. However, the ongoing COVID-19 pandemic has become one of the biggest shocks for the aviation industry in the U.S. and globally, which cannot go unnoticed for airline employees and employee-employer relationships. This essay explores the impacts of the COVID-19 pandemic on airline labor relations with special attention to labor unions’ functions and factors that increase the need for effective workforce management in the industry.
Old and Current Factors in Airline Labor Relations
Product Perishability and the Resulting Dangers of Industrial Action
Even without the pandemic, the airline sector of the industry in question was associated with employee relations issues due to the unique characteristics of air transportation services. Prior to the start of the pandemic, the international airline industry employed over 8 million employees directly and supported more than 49 million jobs (Harvey and Peter 307). In the U.S., those figures were over about 700 thousand people and 10 million jobs before the disease outbreak (Harvey and Peter 307). In the airline industry, labor relations and workforce management processes have always been attached much importance due to the presence of different but interconnected factors.
To start with, regardless of disease pandemics, natural disasters, and other circumstances, the need for effective labor relations practices in the industry is enormously high due to the issue of product perishability. Most importantly, the finite seat inventory of an airline is widely regarded as an example of perishable assets. Obviously, unlike many types of sellers, airline service providers are incapable of treating passenger seats on canceled flights as a strategic resource (Harvey and Peter 309). Any canceled flight has immediate consequences for the organization’s operations and increases the risks of reputational losses. Taking that into consideration, any attempts of employees to start industrial action due to being dissatisfied with labor relations practices are extremely costly for employers in the airline sector, both financially and reputationally. History knows multiple examples of very costly airline strikes in the U.S. and Europe, and the repetition of such events today would exacerbate the situation and decrease the aviation industry’s chances to survive the pandemic even more.
Demand for Air Travel and Labor Relations
The peculiarities of the demand for air travel present another factor that supports the need for effective labor relations and employee-employer communication strategies in the airline sector. As is highlighted by Harvey and Peter, the demand for airline services is cyclical and is dependent on the rate of economic growth, which involves the elevated risks of uncertainty for airline employees after major crisis events (308). Fluctuations in economic growth have a tremendous impact on the demand for airline services, especially when it comes to business class flight deals (Harvey and Peter 308). Considering these characteristics of demand, airline employers should be able to build workplace relationships in which airline staff members would be ready to make concessions during periods of low demand (Harvey and Peter 308). The expected concessions may include employees’ readiness to accept temporary wage restraints, reductions in travel allowances, or salary cuts.
At times of the worrying epidemiological situation, the cyclic nature of demand is problematic for labor relations in the global airline industry since it exacerbates misunderstanding between employers and the workforce. During the period of low demand for air transportation services, for instance, now, airline employees are anticipated to face job losses, reduced work schedules, and associated changes in personal income (Harvey and Peter 308; Josephs). In theory, demand does not stay low forever, and when downturns are finally over, airline employees assume that the returning financial prosperity will provide enough resources for the complete removal of wage restrictions. From the perspective of airline management teams, increases in demand can be misleading and are often followed by even greater reductions in demand. Considering this and the need to restore airlines’ competitiveness, employers in the sector foresee financial risks and avoid rapid improvements in employment conditions, which adds to the risks of industrial action (Harvey and Peter 308). Therefore, demand fluctuations play an important role in labor relationships in the airline sector.
The impact of uncertainties related to the demand for services on labor relations is especially high today, during the ongoing crisis linked with the need to pay as much attention as possible to the struggles affecting the healthcare sector. After the relaxation of lockdown restrictions in the United States and due to essential seasonal demand fluctuations, the demand for internal flights has increased in recent months, and the first signs of labor market recovery have also appeared (Josephs). Among other things, recent improvements include the trend towards the normalization of the airline flight completion rate after the peak of flight cancellations in March and April 2020 (Airlines for America 10). Despite that and a six-time increase in the percentage of the active fleet (5% in February and 30% in September), U.S. airlines do not guarantee consistent improvements in labor conditions for their employees (Airlines for America 22; Josephs). All of this may affect labor relations in the industry by motivating industrial action and protests caused by employees’ and labor unions’ attempts to keep the number of those losing jobs to a minimum.
COVID-19 and Employment Trends in the Airline Sector
To predict future issues in labor relations and spot some emerging trends, it is essential to study the current situation with employment in the industry. When discussing the long-term economic effects of the pandemic and the resulting job losses, some authors believe that the crisis will create financial conditions similar to those at the times of the Great Recession (Sobieralski 1). Having used the vector autoregression model to draw comparisons between different uncertainty shocks affecting the airline sector in the past and today, Sobieralski makes predictions regarding the effects of the pandemic on airline employment (1). The effects on employment are expected to be the most pronounced for major airlines, which is related to the inflexibility of their business models and larger payroll liabilities compared to other carriers (Sobieralski 4). For low-cost carriers, large industry shocks result in sharp declines in employment, but business model flexibility and relatively low employee wages are expected to help them to recover faster than major airlines (Sobieralski 4). Probably due to the effects of contracting, regional airlines are expected to demonstrate an increase in employment levels after the lifting of restrictions (Sobieralski 4).
Statistical research methods also allow delving into some labor relations issues in the aviation industry by predicting the effects of the pandemic on different groups of employees. According to the study by Sobieralski, some employees will face “deeper workforce cuts” compared to other groups in the industry (9). Among them are major airline employees that fulfill passenger handling tasks and those in low-skilled jobs, whereas managerial staff will be the least affected by changes in employment (Sobieralski 9). Many low-skilled airline employees are not represented by specific trade unions, which is why lawmakers must make sure that employees from this category will receive enough funds.
Labor Unions and Their Current Role in Labor Relations in the Aviation Industry
The Rate of Unionization in Aviation
In aviation and the airline sector, employees’ membership in labor unions plays a significant role in the process of employee and labor relations by enabling airline employees to engage in collective bargaining. At the times of the crisis linked to the pandemic, a high degree of unionization continues to be among the major trends in aviation and the airline sector. Almost 43% of airline employees in the U.S. held membership in trade unions in the 1980s; that number reached 50% in 2005 and remains high today (Josephs; Walsh 19). Aviation and airline transportation is widely known as one of the most unionized industries, with specific organizations existing to protect the rights of airline pilots, flight attendants, air traffic controllers, and mechanics. The process of collective bargaining in the U.S. aviation industry has “often been contentious, protracted, and centered on carrier demands for concessions but remains central in determining airline workers’ employment terms” (Walsh 20). Taking today’s financial crisis into account, aviation and airline labor unions are now facing an extremely difficult task involving the minimization of negative changes in employment conditions.
Labor Unions’ Responses to the Ongoing Crisis
The COVID-19 pandemic has already become one of the key events encouraging aviation labor unions to initiate strong political action to ensure more protection for airline employees. These efforts mainly refer to advocating for the expansion of financial support measures implemented by the federal authorities of the U.S. Some airlines in the U.S. have already received federal financial support to protect a number of jobs in the industry. However, the most recent federal aid package has expired in October. According to estimates, it is expected to leave over 75.000 U.S. airline employees in a state of uncertainty about their jobs and future careers (Josephs). Financial losses due to COVID-19 are still tremendous for the industry, which cannot be left unnoticed in terms of employees’ career prospects and opportunities to protect themselves. In this situation, labor unions get into a political game and attempt to support airline workers.
Labor Unions as Intermediaries between Employees and Lawmakers
During the COVID-19 pandemic, employees in the sector continue to rely on labor unions when it comes to the labor relations process and negotiations. Bearing responsibility for negotiations with airline managers is what can be cited as the main and traditional function of airline labor unions. However, the COVID-19 pandemic and its economic repercussions have made perceptible amendments to labor unions’ role in labor relations. To some degree, the situation has created specific circumstances in which both airlines and airline employees are severely affected and need financial assistance from another external party – the government. Today, trade unions fulfill their role by directly interacting with the government and transforming into influential political actors.
This new role of labor unions in the aviation industry finds reflection in many news articles published since the start of the pandemic and covers industrial relations in the airline sector. First of all, the COVID-19 pandemic has encouraged different aviation labor unions to propel cohesiveness to the next level and work together in the name of the industry’s recovery and employees’ well-being. At the end of March, a group of thirteen aviation labor unions wrote a letter to the U.S. Congress (“Aviation Unions Call on Congress”). The signatories included organizations to represent safety workers, pilots, flight attendants, media/communications specialists, and aerospace professionals.
In the mentioned letter, the labor unions highlight the degree to which the selection of the right priority areas affects the effectiveness of any large-scale financial support measures and relief packages. The 9/11 events are mentioned as an example of the key crisis events affecting the industry in the past (“Aviation Unions Call on Congress”). As per the signatories’ statements, the country’s responses to the economic issues affecting the U.S. airline industry in the post-9/11period were not that effective and well-considered when it comes to frontline employees, not management teams. According to the signatories, the financial package that the U.S. Congress provided for the aviation industry nineteen years ago just did not prioritize people. That resulted in giving all support to executive leaders and shareholders, almost no benefits and support for frontline aviation workers, and abuses of the Bankruptcy Code by employers for the purpose of imposing harsher concessions (“Aviation Unions Call on Congress”). From the labor unions’ viewpoint, too many employees can be made to accept permanent and rather strict concessions one by one just because their interests and needs are not treated by authorities as to the priority area.
From the letter, it is clear that one of the most critical goals that aviation labor unions are willing to achieve is to prevent the repetition of the post-9/11 scenario in terms of the measures to facilitate the aviation industry’s restoration. After expressing their deep concern for common employees in the U.S. aviation industry, the labor unions encouraged the U.S. Congress to plan industry support measures by placing special emphasis on common workers’ needs (“Aviation Unions Call on Congress”). The organizations’ specific expectations regarding federal aid include statutory guarantees that most of the money will be used to support frontline employees and minimize changes for these professionals (“Aviation Unions Call on Congress”). Thus, in the current circumstances, aviation labor unions unite in larger groups to communicate frontline employees’ interests to organizations with lawmaking and budget planning authority.
Aside from writing open letters to the U.S. Congress, aviation labor unions have taken an active part in advocating for the extension of federal aid to help airlines to survive the period of almost non-existent demand for air transportation services. At the end of March, the U.S. Congress approved a $32 billion aid package to support airline workers (Joseph). Being worried about the impact of demand that remained low at the moment, aviation labor unions contacted the U.S. Congress and presented the request to double the aid funding to prevent massive job losses (Joseph). Later, the executive leadership of American Airlines supported labor unions’ efforts to decrease the need for involuntary furloughs by extending federal payroll aid (Joseph). The request of aviation labor unions regarding doubling the aid package won massive support from lawmakers and the U.S. President, but the final decision regarding an extra $25 billion in funding was not made as quickly as expected (Joseph). Despite the speed of decision-making processes at the federal level, aviation labor unions were active in pushing their requests, thus motivating employers to follow their example.
At the present moment, airline labor unions continue efforts to increase the amount of money aimed at supporting frontline employees. For instance, on the 7th of October, the Association of Flight Attendants has reported the creation of another letter to the U.S. Congress. The letter signed by thirteen labor organizations presents a response to the unexpected suspension of negotiations devoted to the need for additional COVID-19 relief measures to support the aviation industry (AFA). The group of airline labor unions and trade associations in the travel industry continues to insist on the necessity to extend the Payroll Support Program to prevent the mass collapse of the aviation industry (AFA). Despite labor unions’ attempts to gather lawmakers’ support, no decisive and timely action followed their previous requests, and the PSP expired on the last day of September (AFA). Unfortunately, it minimized some airlines’ chances to avoid dozens of thousands of furloughs.
In addition to direct communication with the authorities, aviation labor unions and their members make use of other ways to voice their concerns, including rallies and protests outside of the workplace. In the context of labor relations, rallies are often used by employees to demonstrate support for political initiatives or even attract public attention to prominent issues surrounding their communication with employers. During the COVID-19 pandemic, the primary sources of uncertainty affecting the airline workforce are the future of federal aid packages and airline managers’ access to funds to keep as many jobs as possible.
In response to the sources of uncertainty, some local events have already been organized by airline employees and labor union members to use the available means to fight for their jobs. The airline employees’ rally that took place on the 15th of September near the Federal Court House Building in Cleveland is among the most recent examples of protests involving the participation of union members (Vandenberge). The participants’ claims were related to the increasing risks of massive furloughs and requests to take action to expand the Payroll Support Program before October to prevent negative implications for both employees and millions of jobs supported by the airline industry (Vandenberge). Although the rally did not result in the immediate continuation of negotiations over the extension of PSP, it demonstrated the degree of unity between the members of labor unions.
Conclusion
To sum up, uncertainty shocks from the pandemic have a huge impact on the aviation sector and labor relations processes. It is due to the sector’s unique characteristics and nature, such as being service-intensive, having comparatively high labor costs, and the popularity of aviation labor unions. Airline employees are well aware of the prerequisites to employees’ job satisfaction and intentions to stay at their jobs, but the current situation with federal aid extensions severely limits their opportunities to prevent job cuts. Although with mixed success, aviation labor unions fulfill the role of intermediaries between at-risk employees and the lawmaking authorities.
References
Airlines for America. Tracking the Impacts of COVID-19. 2020, Web.
Association of Flight Attendants. “Aviation Unions and Industry Urge Congressional Action to Extend PSP.” AFA News Release. 2020, Web.
“Aviation Unions Call on Congress to Prioritize Workers in Relief Package.” TTD. 2020, Web.
Harvey, Geraint, and Peter Turnbull. “Human Resource Management and Industrial Relations.” Air Transport Management: An International Perspective, edited by Lucy Budd and Stephen Ison, Routledge, 2017, pp. 307-318.
Josephs, Leslie. “A Flood of Job Losses Looms as Airline Industry Struggles in Pandemic.” CNBC. 2020, Web.
Sobieralski, Joseph B. “COVID-19 and Airline Employment: Insights from Historical Uncertainty Shocks to the Industry.” Transportation Research Interdisciplinary Perspectives, vol. 5, 2020, pp. 1-9. Web.
Vandenberge, Jordan. “In-Depth: Airline Workers Rally for Extension of ‘Vital’ Federal COVID-19 Relief Program.” News 5 Cleveland. 2020, Web.
Walsh, David. “Where Have They Landed? Observations on US Airline Labor Relations.” Labor and Employment Relations Association, vol. 21, 2017, pp. 18-22.