Originally published February 13 2006
Union leaders objected to stock-based bonuses
by Mike Adams, the Health Ranger, NaturalNews Editor
Two American Airlines union leaders object to stock-based bonuses for executives. The president of the Allied Pilots Association said: "It is absolute insanity to pay out seven-figure bonuses at a time when the company is suffering nine-figure losses."
Leaders of two unions at American Airlines have objected to stock-based bonuses that executives of the money-losing carrier are due to receive in April.
Last week, the company provided more details about bonuses for about 1,000 executives, from the airline's No. 2 official to midlevel managers.
The bonuses, first spelled out in 2003, were increased because AMR's stock price increased more than any other major U.S. carrier through the end of 2005.
The company also estimated last week that stock options granted to all employees in 2003 could be worth more than $500 million when they vest, also in April.
Still, leaders of unions for American's pilots and flight attendants said the executive bonuses were poorly timed because AMR has lost more than $7 billion since the beginning of 2001.
"Saying that many of our pilots are outraged would be a significant understatement," said Ralph Hunter, president of the Allied Pilots Association in a letter to his members on Monday.
AMR has cut costs sharply, largely through layoffs and pay cuts, but analysts still expect the company to lose about $675 million for the year when final 2005 figures are released this month.
On Monday AMR shares rose 13 cents to close at $22.79 on the New York Stock Exchange, near their 52-week high of $23.53.
Tommie Hutto-Blake, president of the Association of Professional Flight Attendants, told her members in a message posted Friday that the "very poor timing of management bonuses" wasn't in the best interests of the company and employees.
AMR has disclosed the management bonuses in regulatory filings since 2003, although it hasn't put a dollar figure on the total cost.
He said the plan, in which executives depended on bonuses for a high percentage of their compensation, held managers accountable for the company's fate.
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