American Airlines has warned about 25,000 frontline employees of possible job cuts because of a downturn in the demand for flights during the COVID-19 Pandemic.

25,000 employees account for roughly 29 per cent of its US mainline workforce.

In order to get as many employees as possible out of the payroll before the actual work cuts, the company urged the employees to take up to two years of extended leaves and early retirement benefits.

"And with infection rates increasing and several states reestablishing quarantine restrictions, demand for air travel is slowing again," CEO Doug Parker and President Robert Isom said in the letter to staff, as quoted by CNBC.

In June, revenue from American Airlines declined by 80% year on year.