By Tracy Rucinski CHICAGO, Oct 9 (Reuters) - U.S. aviation
By Tracy Rucinski
CHICAGO, Oct 9 (Reuters) – U.S. aviation contractors laid off hundreds of staff on account of delays in payroll support from the U.S. Treasury that was meant to guard jobs, an investigation by a U.S. Home of Representatives subcommittee discovered.
Beneath the Coronavirus Help, Aid and Financial Safety Act (CARES Act), corporations within the aviation sector had been granted funds to cowl six months of their payroll because the COVID-19 pandemic prompted a precipitous decline in air journey.
The laws banned any job cuts by means of September, and requires the U.S. Division of the Treasury to start distributing funds to eligible corporations inside 10 days of the legislation’s approval on March 27.
However an investigation by the Home Choose Subcommittee on the Coronavirus Disaster discovered that prime contractors didn’t obtain the cash till months later, leading to greater than 16,500 layoffs and furloughs at 15 corporations, greater than 15% of the aviation contractor workforce.
“Had Treasury met the deadline set by Congress, many of those jobs would have been preserved,” the report stated.
Treasury didn’t instantly remark.
Among the many prime seven contractors, Swissport waited 99 days earlier than its payroll assist settlement with Treasury was finalized, Gate Gourmand 78 days and Flying Meals Fare 74 days, main to almost 12,000 layoffs and furloughs at these three corporations alone.
The businesses nonetheless acquired the total quantity of federal support based mostly on their pre-pandemic workforce, though that they had laid off lots of these staff, the report stated.
Swissport, Gate Gourmand and Flying Meals Fare didn’t instantly remark.
Aviation contractors had been awarded $three billion underneath the primary CARES Act and will see these funds prolonged for an additional six months if Congress passes a second stimulus package deal.
The report recommends one other spherical of support however stated layoffs ought to be prohibited till an organization makes use of all of its funds and urges Treasury to expedite funds to make sure that job retention is the highest precedence.
(Reporting by Tracy Rucinski; Modifying by David Gregorio)
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