On Friday, March 2, United Airlines President Scott Kirby reportedly sent a memo detailing the changes in their policy for giving performance bonuses to employees. The company will shift to an unconventional program, which is a lottery-style drawing. Prizes for the United Airlines lottery will include luxury vacations, new cars, cash prizes ranging from $2,000 to $40,000, and a quarterly grand prize of $100,000.
New Bonus Plan
According to a report by the Chicago Business Journal, United Airlines plans to make employees feel the excitement and at the same time get a sense of accomplishment by changing the bonus system.
“As we look to continue improving, we took a step back and decided to replace the quarterly operational bonus and perfect attendance programs with an exciting new rewards program called ‘core4 Score Rewards’.”
United Airlines rolled out the Core4 program in January. This program aims to improve the degree of care that the airline extends to its guests.
Memo Ignites Firestorm
Unlike what the management expected, employees were disappointed, and there was reportedly a “firestorm.” Given the new format for earning bonuses, it’s not surprising why employees met the changes with disappointment and disbelief. The move means employees will forego bonuses ranging from $63 to $7,589 and that prizes will be distributed randomly with someone receiving $100,000 each quarter.
In the old incentives program, all qualified employees could receive a bonus. However, the changes mean that only who whose names come out in the lottery will enjoy rewards.
The United Airlines incident involving a passenger who was dragged off a flight inspired this program. By changing the bonus scheme in the company, United’s president hopes to encourage staff to pay closer attention to the needs of customers. Airline management also wants employees to start using personal judgments rather than sticking to a rigid set of rules.
While employees have been disappointed in the incentives plan, this should not be confused with the profit-sharing program. Maggie King, a spokesperson for United, clarified that the new bonus program is separate from profit-sharing. Last year, employees received profit-sharing bonuses amounting to $349 million.
King did not comment on the new bonus plan by United Airlines, but she revealed that there would be other new rewards for the company’s employees, not just the $100,000 lottery.