United Air hits pause on changes to bonus program after employee uproar
- Author: David Armstrong Mar 07, 2018,
Mar 07, 2018, 11:40
"Our intention was to introduce a better, more exciting program, but we misjudged how these changes would be received by many of you", President Scott Kirby said in a message to employees.
United announced to employees March 2 that the company planned to change its company-wide employee bonuses from a quarterly payment (of up to $375) based on the airline meeting operational goals to a quarterly lottery system, in which only employees with a ideal attendance record could participate.
"We believe that this new program will build excitement and a sense of accomplishment as we continue to set all-time operational records that result in an experience that our customers value", a United spokeswoman told CNBC.
"As we look to continue improving, we took a step back and chose to replace the quarterly operational bonus and ideal attendance programs with an exciting new rewards program called "core4 Score Rewards", Kirby wrote in the memo. Under this system, quarterly drawings would be held with prizes ranging from thousands of dollars in cash to resort packages and luxury cars, the Chicago Business Journal reported. United Airlines did not immediately respond to a request for comment from Fortune.
The airline described the new scheme as a "more impactful and meaningful program" for its employees who used to be eligible for a bonus if they attained flawless attendance.
Under the lottery system, just 1,361 employees would receive bonuses, according to the United Airlines memo, and only one would be chosen for the top cash prize of $100,000. This time, however, they are in the news for replacing their employee bonus system with a lottery system, according to reports.
"I can't imagine driving the Mercedes into the employee lot while everyone around me that worked just as hard, or harder got nothing".
The post also complained that employees did not receive a $1,000 bonus after the new tax law passed.
Based on employee reactions, the program wasn't inspired by United's staff needs and requests.
As detailed in United's recent 2017 fourth quarter earnings release, the company distributed approximately $30 million in earned incentive payments for achieving operations performance goals during the quarter. Last year, the company paid out $87m in such rewards.
Now United says it was a 'misjudgement'.
Kirby said Monday that United is now halting these changes to consider employee feedback, though he did not specify when the airline expects to have a decision about their next move.