Tue, Mar 20, 2007
Will Receive $480 Million In Benefits; Grinstein Won't Collect
Employees at Delta Air Lines who
stood up to fend off a hostile takeover attempt by US Airways will
be rewarded for their loyalty, when the carrier emerges from
Chapter 11 bankruptcy protection.
The Financial Times reports Delta workers will receive $480
million in cash and stock options, as part of a restructured pay
and incentives package. The plan also includes profit-sharing
options and bonuses for staff and executives.
Under the plan, some 39,000 Delta employees will receive a 3.5
percent stake in the airline. Approximately 12,000 managers will
receive a further 2.4 percent stake in "equity opportunities," the
airline announced Tuesday.
Interestingly, one Delta won't receive any such bonus: CEO
Gerald Grinstein, who stated last year he plans to retire from the
airline once it emerges from bankruptcy.
Though many credit Grinstein with leading the charge against the
US Airways bid, he says Delta's employees should be rewarded for
sticking with the carrier through difficult times.
"They let it be known how miserable and unhappy they would make
life [under US Airways]," Grinstein told the Financial Times. He
emphasized the incentive plan was not a ploy to "buy" employee
support and morale.
Meanwhile, Delta CFO Ed Bastian said the effort in fending off
the US Airways bid helped the airline gain leverage with its
creditors' committee, to win support for its reorganization
"They said 'No' to US Airways and 'Yes' to investing $500m in
our people," said Bastian. "That was certainly something that [US
Airways' CEO] Doug Parker was not planning to provide."
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