United Airlines reconsiders swapping employee bonuses with lottery

United Airlines reconsiders swapping employee bonuses with lottery

"We announced a new internal program based on United meeting certain operational and dependability metrics as a way of offering meaningful rewards to our employees", said a United spokesperson in an email with Inc.com.

"Our intention was to introduce a better, more exciting program, but we misjudged how these changes would be received by many of you", United President Scott Kirby said in a note to employees.

United announced to employees March 2 that the company planned to change its company-wide employee bonuses from a quarterly payment (of up to $375) based on the airline meeting operational goals to a quarterly lottery system, in which only employees with a flawless attendance record could participate.

The proposed lottery system - which offered prizes ranging from a Mercedes sedan to a one-person $100k payout - would've only affected 1,361 employees, and cost the company around $18m. The lottery idea was introduced two months later, and it was not received with the kind of enthusiasm that executives of this airline had hoped for.

Kirby's decision comes at a particularly challenging time for United Airlines as the carrier grapples to reassure shareholders and appease employees amid lagging financial performance compared with rivals' and demands for better wages and benefits.

The lottery would have caused a majority of the airline's 90,000 workers to lose bonuses that paid up to $1,500 over the course of the year. Other employees stated that the lottery system does not appeal to them and could thus opt out of participating simply by not doing a good job.

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According to United's latest earnings report, employees earned approximately $30 million in incentive payments for achieving operations performance goals in the fourth quarter ending in December, and approximately $87 million in earned bonuses in 2017.

"We are pressing the pause button on these changes to review your feedback and consider the right way to move ahead".

United's line: A rep's explainer: "We believe that this new program will build excitement and a sense of accomplishment as we continue to set all-time operational records that result in an experience that our customers value".

"The employee group that would have been eligible for those bonuses was much larger" than that of the lottery system, Taylor Garland, spokeswoman for the Association of Flight Attendants, said in a phone interview. United Airlines did not immediately respond to a request for comment from Fortune. United Continental has about 88,000 employees.

A company's culture is indelibly intertwined with an organization's brand. Employees are said to be pretty displeased with the new approach.

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