United and it's problems

[MikeD]

United and it\'s problems

Still no mention of execs and Board members taking a pay cut in order to pare back labor costs. How come the line people are seen to be able to handle a pay cut, but executives are invulnerable from such cuts as well?

Cut the execs' pay proportionally with cuts line personnel are experiencing. That would show a serious effort to save the company. I bet that would save a few million bucks right there.

My only beef is this:

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A bankruptcy judge Friday approved United's amended financing plan, giving it an additional $500 million in borrowed money, and extended the airline's deadline for filing a reorganization plan by a month to Sept. 30

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STOP giving federal money to these airlines that just flush it down the toilet. The airlines need to get their act together themselves, and not stay dependant on federal bailout money. The market will take care of itself with the strong surviving, and the weak falling by the wayside.

http://www.usatoday.com/money/biztravel/2004-08-22-united_x.htm

On a related note:

Both United and Continental, along with US Air, ceased funding pension plans. According to a press release, ALPA concedes that something needs to change with pilot pension plans. But shouldn't execs also accept changes to their "golden parachutes"?

http://www.atwonline.com/indexfull.cfm?newsid=4516

 

[MarineNav]

Re: United and it\'s problems

Hello Mike,

Whatever happened to good 'ol performanced-based compensation and retiring on ones company stock portofolio. Seem these things should be considered once again and be implemented if at all possible. Using the parachute analogy, being that they're "captains" of industry, shouldn't they be the last (after the crew) to bail from the plane (company) rather than be the first and only?

Regards,

JR

 

[flyover]

Re: United and it\'s problems

[ QUOTE ]
Still no mention of execs and Board members taking a pay cut in order to pare back labor costs. How come the line people are seen to be able to handle a pay cut, but executives are invulnerable from such cuts as well?

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This was in April :

United CEO takes another cut in pay

CHICAGO (AP) — UAL Corp. CEO Glenn F. Tilton will be taking another salary cut due to bankrupt United Airlines' continued financial woes, the company announced Friday.

In December, Tilton reduced his and the annual salaries of 36 other executive officers by 11%. The action was taken at a time when the airline announced the layoff of about 350 pilots and other cost cutting measures.

The airline said Tilton's salary will be reduced by an additional 14%, effective April 1. The net effect is a 25% reduction in his annual salary, or a reduction of $237,500, to $712,500.

[ QUOTE ]
Cut the execs' pay proportionally with cuts line personnel are experiencing. That would show a serious effort to save the company. I bet that would save a few million bucks right there.

[/ QUOTE ]

I don't know of any airline where management hasn't taken cuts. For Tilton personally took a cut coming to UAL. My only point is they rarely get any credit for taking cuts. I'm not sure if they worked for free they'd be well thought of by the rank and file who are bitter about their own situations.

Regardless, exec pay cuts save millions, employee pay cuts save billions. Not fair but it is the way it is.


[ QUOTE ]
My only beef is this:

[ QUOTE ]
A bankruptcy judge Friday approved United's amended financing plan, giving it an additional $500 million in borrowed money, and extended the airline's deadline for filing a reorganization plan by a month to Sept. 30

[/ QUOTE ]

STOP giving federal money to these airlines that just flush it down the toilet. The airlines need to get their act together themselves, and not stay dependant on federal bailout money. The market will ake care of itself with the strong surviving, and the weak falling by the wayside.

[/ QUOTE ]

I think the government agreed. I don't believe this is federal money but instead debtor in possession financing. These debtors get first pickings on the carcass in exchange for providing bk financing.

 

[kellwolf]

Re: United and it\'s problems

[ QUOTE ]
I don't know of any airline where management hasn't taken cuts.

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Let's not forget US Air's golden boy. Right before SWA started service to PHL, he jumped the sinking ship to the tune of up to a $5 million golden parachute.

http://www.sptimes.com/2004/04/20/Business/US_Airways_CEO_quits_.shtml
http://www.msnbc.msn.com/id/4781677/

Then there was the American debacle. They convince their lower ranks to give some concessions and other give backs, then give themselves bonus pats on the back.

http://www.cnn.com/2003/TRAVEL/04/25/american/

Sad thing is, both of these companies would probably be doing a lot better with better leadership. I'm glad to see United's execs taking cuts right along with their front line people. I think if more execs did this, it would go a LONG way towards building positive labor relations. When Herb was renegotiating with the SWA pilots, he asked them to freeze their salary for x amount of years. He followed that up with volunteering to freeze his own salary for the same amount of time. I'm a big believer in management not asking the people below them to ask things they wouldn't do themselves.