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24 March 2021
On 11 March 2021 the Rescue Plan Act 2021 was signed into law, providing much-needed relief that will enable airlines and aviation contractors to keep employees on payrolls. The act provides eligible air carriers and eligible contractors with $14 billion and $1 billion in financial assistance, respectively, exclusively for the continuation of employee wages, salaries and benefits.
Unlike previous payroll support legislation, the Rescue Plan Act payroll support funding is not available to all US carriers and contractors. To be eligible for relief, air carriers and contractors must have received financial assistance under the Consolidated Appropriations Act (CAA) 2021, which was passed in December 2020. Additionally, 'eligible air carriers' are those that:
Similar restrictions apply to aviation contractors which seek relief under the act.
The amount that individual air carriers will receive will be proportional to the amount that they received under the CAA. Aviation contractors will receive the same amount that they received under the CAA.
The bill required the Treasury Department to issue streamlined procedures by 16 March 2021 to enable eligible air carriers and contractors to request financial assistance. Initial disbursements were expected to have followed by 21 March 2021.
For further information on this topic please contact Rachel Welford or Kathryn Sobotta at Cozen O'Connor by telephone (+1 202 912 4800) or email (email@example.com or firstname.lastname@example.org). The Cozen O'Connor website can be accessed at www.cozen.com.
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