SCOOP : As American Airlines prepared to lay off thousands of employees, management was promoted.
Gary Leff at 12. March 2021.
In early February, American Airlines sent out 13,000 WARN Act notices to notify its employees that they could be placed on unpaid leave in early April. At the same time, Americans have been preparing for big pay raises for executives.
The View from the Wing has learned that American has given a pay raise to employees at level 5 (manager) and above starting in February.
This week, President Biden signed the US bailout package, which includes $14 billion for a third airline. The agreement requires American to pay its employees by the 30th. September to keep them on the payroll in exchange for about $3 billion. (Hiring the employees who would have been sent on unpaid leave would have cost them less than $100 million a month for six months, according to a statement at the recent earnings conference.)
But the airline handed out gifts during his address to Congress. And now, with the third airline bailout bill, taxpayers will foot the bill forpay raises for executives.
American Airlines says it has restored executive salaries to 2019 levels in many cases and that non-union employees below the executive level can also expect salary changes in the near future. According to the airline’s spokeswoman, Andrea Cus,
Following the elimination of our annual merit program in 2020, we have reinstated the program for non-represented members of the executive team for 2021. During the first quarter, we completed the annual process for some of our management and support staff.
The total compensation for these group members has not changed and the total compensation for each individual remains at the 2019 level. Of course, those covered by the CARES Act will not receive an increase in their total compensation – that includes Doug, Robert and the entire management team.
In the coming quarter, we will begin evaluating the performance of our senior management team (levels 1 to 4). In addition, our advanced team members will continue to receive their salary increases in accordance with their 2021 contracts, and increases for union-represented team members are unchanged and will be implemented in 2020.
Nonetheless, support for a government pay system places limits on pay increases for airline executives, and American does not appear to have exceeded those limits.
- Employees earning more than $425,000 in 2019 will not be able to earn more than they do now.
- Anyone who earned more than $3 million in 2019 cannot be paid out more than $3 million plus 50% of the amount over $3 million in 2019.
The story is about how former CEO Don Carty lost the respect of his employees after his resignation in the aftermath of 9/11. September had paid bonuses to managers to keep their jobs, while asking union members to return them. The controversy forced Carty to retire from the game in 2003.
American Airlines is not the only airline to reward its executives after laying off 30% of its workforce by 2020. Last month, Delta Air Lines awarded bonuses ranging from $8,000 to $250,000 or more to all executive employees.
The airline must retain the management talent that left while having more than 10,000 union employees than it needs for the flights for which it believes it needs passengers. But the pay increases at a time when a massive staff turnover was expected are especially deafening given the history of the airline, which under previous management rewarded management at the expense of frontline workers.
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frequently asked questions
How many flight attendants will American Airlines cut?
According to American Airlines’ application, 4 245 flight attendants, 3 145 fleet employees, 1 850 pilots, 1 420 maintenance employees, 1 205 passenger service employees, 100 dispatchers and 40 trainers will be laid off.
What is the difference between resigning and being fired?
To cut to the chase: Layoff is a complete separation from the company. And while your employer may decide to take you back at some point, layoffs are usually permanent. Holidays, on the other hand, are temporary. In most cases, employers plan to put employees back to work.
What does holiday mean?
Generally, leave is defined as a temporary absence of employees due to special needs of the business or employer, which may be caused by economic conditions at a particular employer or in the economy at large. … According to her, 850,000 federal employees were laid off in 2013.
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