WeAAsles
Veteran
- Joined
- Oct 20, 2007
- Messages
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And since this was brought up. The decision to give up Profit sharing for a structural increase was a good decision then and is still a good decision now. The 4.3% amounted to almost a $1.00 per hour increase. Roughly $2000.00 per year not factoring in extra hours worked and contributions to our 401k. To equal that amount just on the first year for PS the company would have had to make almost 4 Billion in profit. Now in each subsequent year as our pay rises the company would have to earn more to equal our direct rate.
Now you think it doesn't matter because of the averaging next year? Wrong. Our averaging would have been based on a lower wage. $22.52 rather than $23.48. So we would have been held back by our own wage.
Profit sharing is also taxed at a higher rate than payroll taxes so a larger chunk would have came out of each individuals pocket . So the decision to accept the change on the expedited notice was a good one.
Also to point out that even though the payout was on AA's first dollar of pre-tax earnings, the formula for payout to Fleet was horrible. Some companies pay out PS on an equal basis but AA was not one of those companies.
Now you think it doesn't matter because of the averaging next year? Wrong. Our averaging would have been based on a lower wage. $22.52 rather than $23.48. So we would have been held back by our own wage.
Profit sharing is also taxed at a higher rate than payroll taxes so a larger chunk would have came out of each individuals pocket . So the decision to accept the change on the expedited notice was a good one.
Also to point out that even though the payout was on AA's first dollar of pre-tax earnings, the formula for payout to Fleet was horrible. Some companies pay out PS on an equal basis but AA was not one of those companies.