Steenland To Receive Millions In Stock Options
Add another airline to the list, whose pilots are unhappy with
some big executive bonuses. Pilots at Northwest Airlines say they
gave up $358 million in annual salary, as part of a nearly
24-percent cut in pay the pilots agreed to last year... which makes
the $26.6 million stock bonus Northwest CEO Doug Steenland may soon
receive a bit tough to swallow.
"Mr. Steenland grossly overreached and missed another
opportunity to share the gain with the employees whose excessive
concessions funded the airline's turn around," said Capt. Dave
Stevens, chairman of the Northwest Airlines unit of the Air Line
Pilots Association. "His compensation will be increased to $26.6
million while pilot payroll was slashed by more than 50 percent in
bankruptcy causing morale to plummet. Employees expect a fair
return, not 20 cents on the dollar while executives receive
millions in pay and equity."
Pilots at the still-bankrupt carrier tell ANN last year's pay cut --
agreed to by the pilots union -- was on top of a $265 million
annual concession Northwest pilots gave in December 2004. Northwest
pilots' total concession of $623 million a year totals over $4
billion through 2011, the union states.
"It is incredible that the CEO profits from Northwest's
bankruptcy at the expense of pilots, other employees and
stakeholders," said Bob Elflein, secretary treasurer of the
Northwest Airlines unit of the Air Line Pilots Association.
"Northwest management's mantra seems to be 'we will reap the gain
while labor bears the pain.'"
Snappy catchphrases aside, pilots at Northwest are the latest
airline workers to express disbelief and outrage over executive
bonuses. As ANN reported, pilots at
American Airlines vehemently protested against bonuses and stock
options awarded to management at the airline, which the union said
exceeded American's $231 million profit for 2006 -- its first in
Pilots at Northwest say their airline is also profitable once
again -- thanks in large part to the severe labor cost reductions
workers at the carrier agreed to under Chapter 11.
"Management must recognize and reward the employees with an
equitable share in the company's success. To disregard our
legitimate concerns is a recipe for continued labor unrest," said
Capt. Ray Miller, vice chairman of the Northwest Airlines unit of
the Air Line Pilots Association. "Pennies on the dollar from profit
and success sharing programs are grossly inadequate compensation
for our draconian 40 percent pay cuts and onerous work rules.
Continued pilot concessions based on the Chapter 11 business plan
that has already been far exceeded is absolutely unacceptable."
Northwest states Steenland's bonus isn't set in stone... and it
dependent on the carrier's continued positive earnings.
"The actual equity compensation realized by Mr. Steenland for
both restricted stock and stock options will be a function of
Northwest's business performance and stock price over the four-year
vesting cycle of the award," the airline told Reuters.