United Airlines' Bizarre Bonus Plan Shows Company Still Can't Get It Right

Bizarre thinking has resurfaced at United Continental Holdings Inc.  (UAL)  again.

The airline revealed on Friday that it was replacing quarterly bonuses for eligible employees with a lottery in which only the winners get money or a prize. Reportedly, some 85% of employees oppose the lottery, and many flooded the hotline to management, which was shut down by Friday afternoon.

So much for making progress — and building up some goodwill — after the 2017 passenger debacle.  

The airline is fresh off the first annual gain in its stock price since it merged with rival Continental in 2010, Deutsche Bank points out. Sales in 2017 rose 3%.


Update: In an email from United President Scott Kirby, below, sent on Monday afternoon to employees, the company said it is rethinking its lottery plans.

A message from Scott: We hear you. Changing our ops incentive program.

Dear United colleagues,

Since announcing our planned changes to the quarterly operations incentive program, we have listened carefully to the feedback and concerns you've expressed.

Our intention was to introduce a better, more exciting program, but we misjudged how these changes would be received by many of you.

So, we are pressing the pause button on these changes to review your feedback and consider the right way to move ahead. We will be reaching out to work groups across the company, and the changes we make will better reflect your feedback.

Appreciatively,
Scott

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