Profit Sharing Proposal

[seeking the truth]

Below is an excerpt of a profit sharing plan being drawn up by the company. The full text can be viewed on the hub under news then special bulletins. This may be a step in the right direction.

But the question has to be asked, how many of todays emplyees will be around to share in it, assuming it happens. I started a thread, an Open letter to Mr. Lakefield on this very point.

The carrot is being dangled, but no clue to how many get to take a bite from it !!!!


The Board of Directors has authorized US Airways to
present a profit-sharing proposal to negotiators of
the company's labor groups as part of the process to
reach consensual agreement on the Transformation Plan.

"This would be a unique plan within the airline
industry. It also represents a generous gesture on the
part of our majority owner, the Retirement Systems of
Alabama, which would sacrifice a portion of its upside
potential to share profits with employees," said CEO
Bruce Lakefield.

 

[Schatzee]

"This would be a unique plan within the airline
industry. It also represents a generous gesture on the
part of our majority owner, the Retirement Systems of
Alabama, which would sacrifice a portion of its upside
potential to share profits with employees," said CEO
Bruce Lakefield.

Oh thank you so much Mr. Bronner for making such a generous gesture. You are asking for concessions for the 3rd time with some employees possibly having their pay reduced over 35%. That is so nice of you to offer to sacrifice some of your profit to the people who made this company. :angry:

 

[cavalier]

Profit Sharing Plans,

Structured properly can go a long way towards curing many of the ills facing US Airways.

Personaly my profit sharing which has a 401K element yields about 16% of base salary when fully leveraged by the employee.

Ford and UAW did one that has been well recieved by the workers. Don't dismiss it out of hand.

They can hang all kinds of carrots in front of the employees but it's my opinion that without spirit which is dead, it's all moot. Moral has be bad in the past, now it's nonexistence. How can anything that has no spirit continue and even prosper, which is necessary for profits to become a reality? Even a dog who is probably one of the most forgiving creatures on the planet when kicked too many times will lose it's spirit, and we don't have dogs working at U.

 

[700UW]

US Airways tries to cushion blow of concessions

Friday August 6, 5:37 pm ET
By John Crawley


WASHINGTON, Aug 6 (Reuters) - US Airways (NasdaqNM:UAIR - News) will offer its employees a sweeter profit-sharing plan to help the carrier secure another round of labor concessions as it tries to operate more like low-cost rivals and avert another bankruptcy, the company said on Friday.

The struggling carrier is looking for $1.5 billion in cost cuts by summer's end. More than half the concessions are expected to come from labor groups, which represent roughly 24,000 workers at the struggling airline.

Bruce Lakefield, the airline's chief executive, has warned unions that another round of deep cost savings are necessary to compete with low-cost carriers like Southwest Airlines (NYSE:LUV - News) and avoid the carrier's second Chapter 11 filing in two years.

That downcast scenario has yet to produce giveback agreements from any of US Airways' labor groups. But to facilitate talks, the company's board has authorized management to offer a profit-sharing plan that is richer than the one that took shape during the airline's restructuring.

The deal would be open to all employees except company officers, but would not go into effect if US Airways were to slide into bankruptcy, Lakefield said.

He called it a "good faith gesture" by the company's principal owner, Retirement Systems of Alabama, to cushion the blow of concessions and reassure skeptical employees that management was committed to viability.

"RSA would be giving up a significant portion of its upside potential in any turnaround US Airways would enjoy to share these profits with the employees," Lakefield said.

Details of the proposal are still to be worked out, but employees would receive cash on a percentage of annual pretax profits excluding unusual items.

The payout would be 10 percent if profit margins were between 0 and 5 percent. Awards would be 25 percent for margins exceeding 5 percent. There is no cap on the amount employees can receive and employees would receive lump sum amounts 60 days after the end of the fiscal year.

The current profit-sharing plan starts payouts when margins reach 7 percent.

 

[PITbull]

"The deal would be open to all employees except company officers, but would not go into effect if US Airways were to slide into bankruptcy, Lakefield said".


Folks,


The profit sharing plan incentive is only....

IF WE DON'T GO INTO BANKRUPTCY.
Which part of the message did you all not get????


This profits sharing would be great if the company would have put no "contingency" or restriction on it.

The question remains...how many believe we won't go into bankruptcy?

Those are the folks that this kind of incentive would think would B) be great.....

 

[ELP_WN_Psgr]

Profit sharing plans are good and can be used to tie the well being of the employee to the well being of the company.

That being said, does anyone really think, for even an instant, that the crew running the show in CCY would hesitate for a second to tak a walk thru Ch 11 if, for no other reason, just to render the profit sharing plan null and void?

 

[PITbull]

Profit sharing plans are good and can be used to tie the well being of the employee to the well being of the company.

That being said, does anyone really think, for even an instant, that the crew running the show in CCY would hesitate for a second to tak a walk thru Ch 11 if, for no other reason, just to render the profit sharing plan null and void?

Exactly!

 

[700UW]

Profit sharing plans are good and can be used to tie the well being of the employee to the well being of the company.

That being said, does anyone really think, for even an instant, that the crew running the show in CCY would hesitate for a second to tak a walk thru Ch 11 if, for no other reason, just to render the profit sharing plan null and void?

Could not agree anymore with you!

 

[USA320Pilot]

US Airways announces profit-sharing plan

ARLINGTON (theHub.com) - A Special Bulletin today reported that the Board of Directors has authorized US Airways to present a profit-sharing proposal to negotiators of the company’s labor groups as part of the process to reach consensual agreement on the Transformation Plan.

“This would be a unique plan within the airline industry. It also represents a generous gesture on the part of our majority owner, the Retirement Systems of Alabama, which would sacrifice a portion of its upside potential to share profits with employees,†said CEO Bruce Lakefield.

The plan would trigger at the first dollar of annual profit, which is defined as a fiscal year’s pre-tax earnings, excluding unusual items. If the company’s profit margin is between zero and 5 percent, the proposed payout would be 10 percent of the profit.

If the company’s margin exceeds 5 percent, the total payout would be 25 percent of any pre-tax profit above that level. Payment would be in lump sum cash 60 days after the end of the fiscal year, and there is no cap on the amount of profit that could be shared. Company officers would not be included, but other details about eligibility and the basis for distribution are still under consideration.

So, if for example the company were to post a pre-tax profit of $300 million with our planned revenue levels, a profit-sharing pool of approximately $30 million would be created. The proposed profit-sharing plan is contingent on avoiding a Chapter 11 filing.

Among the low-cost airlines, AirTran and America West have no profit-sharing plans, while Southwest and JetBlue do. However, neither Southwest’s nor JetBlue’s payouts are straight cash, which is what the US Airways plan contemplates based on preferences expressed by employees. Instead, Southwest and JetBlue distribute into employee 401(k) accounts, and it could be a combination of cash or stock.

“We believe the proposed profit-sharing plan would go a long way toward our goal of changing the company’s culture by rewarding employees for their contributions to our profitability. As a cash-based plan, it also would provide a more immediate return for the significant sacrifices we are asking employees to make to return US Airways to financial health,†Lakefield said.

After the Special Bulletin was sent, employees raised questions, which the following clarification addresses:

All employees who participate in cost savings measures under The Transformation Plan would be eligible to participate in the profit-sharing plan. This includes both union and nonunion employees. This newly proposed plan would replace the current profit sharing plan, which was put into place following the August 2002 restructuring.

Respectfully,

USA320Pilot

 

[PITbull]

So USA320,

I am assuming from your copy above that you too believe the company will avoid Bankruptcy by sharing all this good fortune with the employees?

Huh?

Its like saying..."Hey, if I hit the lottery for $300 million, i'll give you some, and that is if there is not a cloud in the sky that day....

 

[mwereplanes]

So it seems to me that the union response should be something to the effect of:

"We agree to the concessions as negotiated providing we stay out of C11. If C11 is entered at any point all contracts will snap back to the contracts prior to the entry of C11. If for any reason the profit sharing is eliminated all contracts will snap back to the contracts prior to the concessionary contracts." Further, all contracts will snap back to previous contracts in the event any upper level manager is retained after the company shows 2 quarters of successive losses. Further, all contracts will snap back to previous contracts when ANY executive is paid ANY amount higher than ANY executive who is employed by JetBlue. ETC......

Why is it we allow them to set the requirements?

mr

 

[Winglet]

How about a nice ESOP plan? Worked great for UAL. Everybody loved it.

 

[robbedagain]

How about a nice ESOP plan? Worked great for UAL. Everybody loved it.

until the company went into a tailspin and then a ch11 now ask them how it went!!! from what i had been told by a few friends at ual at my city it wasnt pretty but then again i dont know

 

[unit4clt]

FSA's have had profit sharing since 1999. Nothing new here, just another promise.

 

[oldiebutgoody]

0-5% of what?