United walks back new bonus lottery system that angered employees
United Airlines on Monday reversed plans to begin awarding employee bonuses through a lottery system that angered workers.
Scott Kirby, president of the Chicago-based airline, said United was “pressing the pause button” on changes that would have handed out much larger bonuses — including vacations and luxury cars — but to only a fraction of its workers.
“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 letter to employees on Monday.
Kirby said the airline would reach out to employee work groups and changes made would “better reflect your feedback.”
Kirby originally announced the new lottery-style system — called “core4 Score Rewards” — in a note to workers late last week, according to employees and union officials. The lottery system was intended to replace a program that allowed each employee to receive a bonus of up to $300 per quarter if the company hit certain operational targets.
The core4 system called for a small number of eligible employees to receive prizes per quarter, including cash awards ranging from $2,000 to $40,000, luxury cars and vacations. A single employee would receive a grand prize of $100,000 under the plan, media reports said.
United has more than 80,000 employees, although not all of them are eligible for bonuses. United spokeswoman Maddie King said that frontline employees — those that deal directly with customers — and some members of management would be eligible for the bonus program.
King said the company doesn’t have a timeline for re-evaluating the bonus program.
“Right now we are going to collect feedback from our employees to make sure we can create a new incentive program that will be meaningful to employees as we continue running a great operation and providing excellent customer service” she said in an email.
After the memo detailing the new lottery program was released last week, a petition was created on Change.org deriding the new system. The petition was addressed to the carrier’s management and signed “United Airlines Flight Attendants.”
The petition received more than 1,100 signatures before the poster, who is anonymous, commented: “I was told to take down this petition. Great job everyone but I’m sorry.”
In a statement after Monday’s reversal, the Association of Flight Attendants said it was “encouraged to see that United management has taken flight attendants’ feedback seriously and decided to pause any changes,” according to spokeswoman Taylor Garland. Earlier, the union had said that employees were “entirely opposed to and offended by this new ‘select’ bonus program.”
Airline industry experts had questioned the new lottery system and its impact on employee morale.
Seth Kaplan, managing partner of Airline Weekly, said he couldn’t recall another case where an airline swapped regular cash bonuses for a lottery system, “which I think is the problem,” he said. “If the idea is to motivate people, it doesn’t seem to be having its intended effect.”
Henry Harteveldt, travel industry analyst and president of Atmosphere Research Group, said he thought United had focused too much on the possible cost savings and failed to consider the core4 move, given the potential to divide employees and harm customer service.
“You can’t tell people, ‘If all of you do a good job, a percentage of you win,’” he said. “It’s exactly the wrong message to send.”
While $300 might not go a long way, “employees don’t want to lose something that makes a difference,” he said.