Delta Air Lines saves 24% in pay and benefits costs due to voluntary leave arrangement

Delta Air lines saves 24% in staff expenses due to voluntary leave schemes

Delta Air Lines has saved 24% in salary and benefits costs after more than 45,000 employees choose to take voluntary unpaid leave.

The airline introduced the option for employees to take voluntary unpaid leave in June 2020 to help it deal with the financial ramifications of the Covid-19 (Coronavirus) pandemic.

Separately, the airline has also launched voluntary redundancy and early retirement programmes. Under the terms of these schemes, eligible employees who choose to participate will receive a cash severance payment, fully paid healthcare cover, enhanced retiree healthcare for certain employees, and travel privileges.

The application window for these voluntary departure options closed on 14 July 2020. So far, 17,000 US employees have opted to take up one of these options.

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Paul Jacobson, chief financial officer at Delta Air Lines said: “Our June quarter cost performance reflects extraordinary work by the entire Delta team, as we removed more than 50% from our adjusted cost base,”

“We expect to achieve a similar 50% year-over-year reduction in the September quarter despite a sequential increase in capacity, reflecting the increased variability we have achieved in our cost structure.”