United Airlines Replaces Employee Bonus with Lottery System; Angers Employees

The previously proposed bonus system would have offered employees lottery drawings for cash prizes, luxury cars and vacation packages instead of the now approved quarterly performance bonuses.

While the bonuses were discretionary and not part of any contract, "it starts to become a counted-on piece of income, and now that income might not be there", said Mike Klemm, whose International Association of Machinists and Aerospace Workers represents around 28,000 United employees. A United spokesperson did not say how many people complained about the change, but it was a "significant enough number". "Completely against what the word United means", wrote a flight attendant on the airline employees' private Facebook page.

Many consumers criticized the move on social media, and both journalists and analysts ridiculed the program.

Upon reading comments made by staff members and seeing negative press coverage, it did not take long for United Airlines leaders to cancel the bonus lottery scheme and return to the old system.

United, which has more than 80,000 employees, did not respond to specific questions about either the lottery program or the current bonus program.

Chicago Business Journal, which first reported the change late Friday, noted that Kirby's memo had largely failed to create the "caring" attitude the company has been trying to develop and that the CEO can not afford to jeopardize the company's improving on-time performance. The quick and unified backlash from United's flight attendants and other employees has seen United, temproarily at least, put the proposed change on ice.

A United Airlines plane with the Continental Airlines logo on its tail, sits at a gate at O'Hare International airport in Chicago October 1, 2010. Workers at the Chicago-based carrier are reportedly less than pleased. "We are pressing the pause button", he wrote. Last year, the company paid out $87m in such rewards.

"Our intention was to introduce a better, more exciting program, but we misjudged how these changes would be received by many of you", Kirby said in a memo to employees obtained by Reuters. How a company treats and compensates its employees should reflect not only the values and beliefs of the company itself, but should encourage and reward every employee in the business for delivering the company's brand promise. Employees are said to be pretty displeased with the new approach.

Though internal programs should support your organization's mission statement, vision and goals, this crisis can stand as a lesson for communicators to consider employee needs when implementing a program-not just numbers.


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