Leaders of AMR Corp.’s unions have said that executives of the American Airlines parent company should not be taking bonuses due to declining performance and monetary losses. The unions have gone as far as to parallel these bonuses with AIG’s bonus fiasco. Notably, AMR bonuses are primarily based on stock performance the past three years; shares of AMR have fallen sharply in the past year. “This is simply another PR stunt to try and force the company into making decisions favorable to union interests,” said Missy Latham, an AMR spokeswoman.
Over the past year, there has been plenty written here about AMR’s unions, and unions in general. It’s sometimes really hard to tell who is right and wrong in these cases. American’s pilots have asked for 50 percent raises and increases to their benefits. The average pilot at American earns about $130,000 annually, according to the Airline Data Project at MIT. Not too bad, but they’re still unhappy; and rightfully so.
Back to the AIG thing for a bit, “If you compare us to AIG, American’s executives took bailout money from the employees in 2003, and they’ve rewarded themselves with millions of dollars in bonuses ever since,” said Scott Shankland, an American pilot and spokesman for the Allied Pilots Association. “And in the meantime, the airline is doing terrible.” Apparently, it’s not just the C-Level and VP positions that get rewarded, it’s the top 1000 managers for the airline; all rewards are paid in company stock.
The exact number won’t be known until the Wall Street bell rings at 4PM on April 15. The bonuses will be derived from last price of the trading day. Do you think airline executives should receive bonuses? Feel free to comment and voice your opinion.
