Delta Air Lines to pay $8.1 million over alleged pandemic relief violations

Delta Air Lines has agreed to pay $8.1 million to settle allegations that it violated federal rules tied to COVID-19 relief funding by giving excessive pay to some top employees, according to the U.S. Justice Department.

The settlement stems from Delta’s participation in the Payroll Support Program (PSP), a program established by Congress in March 2020 under the CARES Act to provide financial support to airlines during the COVID-19 pandemic.

In exchange for federal assistance, carriers agreed to specific conditions, including limits on compensation for certain executives earning over $425,000 per year.

According to the Justice Department, Delta entered into PSP agreements with the U.S. Treasury in 2020 and 2021, but between March 2020 and April 2023, awarded compensation to some officers and employees that exceeded those limits.

The company also allegedly submitted inaccurate quarterly compliance certifications and failed to notify the government once the breach was discovered, which would have allowed Treasury to seek repayment.

“The PSP was intended to provide critical assistance to the airline industry during the pandemic,” said Assistant Attorney General Brett A. Shumate. “The department is committed to holding accountable those who failed to abide by the terms and conditions governing their receipt and use of federal funds.”

The settlement also resolves a lawsuit filed by a whistleblower under the False Claims Act, which allows private individuals to report fraud on behalf of the government and share in any recovery. In this case, the whistleblower, H. Remidez LLC, will receive $850,500 as part of the settlement.