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At most companies, changes in employee bonuses don't resonate much beyond corporate headquarters. But airlines are different, and United Airlines created a global public relations saga in March when it decided to alter how it allotted extra money to employees. It's not a surprise the airline walked it back.

United Airlines has revamped its employee bonus program to ensure all workers still will benefit when the airline hits key operational and customer service goals. The move comes roughly nine months after president Scott Kirby angered workers when he sought to swap the scheme for a lottery that would reward some workers with lavish prizes but shut out everyone else.

In changing the program, United is placing less of an emphasis on operational performance, such as on-time arrivals or the number of canceled flights, and slightly more on customer satisfaction. All eligible workers can earn $125 per month if United hits its new marks, similar to before.

“Based on employee feedback, we’re keeping the structure of the program the same but simplifying to focus on just two key metrics,” Kate Gebo, United’s executive vice president of human resources and labor relations, wrote in a note to employees.

Kirby’s plan, which would have awarded prizes including money (up to $100,000 per quarter to one employee) vacation packages and cars, was shelved in March, after employees complained. While some workers would receive exciting gifts — a Mercedes was dangled as a possible prize — many more would get nothing.

Kirby’s plan almost certainly would have saved the company considerable money, but with it set aside, Gebo was charged with formulating a new incentive plan more similar to the previous one.

The biggest changes come in the metrics United must meet before the airline will pay extra money. Employees had been receiving bonuses mainly for reaching important operational metrics, and as United has become a more reliable airline in recent years, they had been accustomed to receiving money in most quarters.

The new plan will place more of a focus on service, and employees will be able to earn the biggest extra chunk — $75 per month — if United raises its customer satisfaction scores by one point, year-over-year. United asks customers to rank the quality of their flights on a five-point scale, and it wants to have a certain percentage rank it above four. If United reaches its goal — Gebo did not share details on exactly how it will be calculated – it will pay bonuses.

“Our goal for 2019 is to achieve a [satisfaction] score that’s at least one point higher than in 2018, and we’ll share monthly goals as we go,” Gebo said.

Employees can also earn $50 if United tops its three main competitors — American Airlines, Delta Air Lines, and Southwest Airlines on D0, an airline term for flights that depart exactly on-time or early. While all airlines like to depart on-time, some are more fanatical about it than others. Among large carriers, American has placed the biggest emphasis on it in recent years. (Some workers call American President Robert Isom, Capt. D0.)

“These are two metrics that we can all influence, whether we interface directly with the customer or support the operation behind the scenes, and they both reflect our commitment to serving our customers,” Gebo said.

Major Kerfuffle

United seemed to be caught off guard with the reaction to its March plan to begin holding a lottery.

“We want every United team member to picture themselves walking home with a grand prize, or driving home in a beautiful car that announces for all to see that you are committed to your success and ours,” Kirby said while announcing it.

But almost from the start, the new plan faced severe criticism from some employees, who accused United of cutting their pay to save money.

One employee created an online petition, and others more quietly criticized management. A pilot union spokesman even took a swipe at the airline to, saying “This just puts a bad taste in our mouths.”

After the complaints, and media coverage that followed, United sent a note to workers putting the lottery plan on hold. “Our intention was to introduce a better, more exciting program, but we misjudged how these changes would be received by many of you,” Kirby told employees.

On Friday, Gebo said United met with employees in 33 locations and read emails from workers before formulating the new plan.

A United spokesman declined to comment on the new bonus structure, saying he would let Gebo’s note for employees speak for itself.

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Tags: airline innovation, labor, united airlines

Photo credit: United Airlines front-line workers will have a chance to win as much bonus money as before. But the metrics for the internal program are changing. United Airlines

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