Monday, October 3, 2022

Air Canada tells senior executives to voluntarily return 2020 bonuses

MONTREAL – Air Canada says it has chosen its senior executives to return their 2020 bonuses in response to ‘public disappointment’.

The airline said in a news release that the president and CEO, as well as executive vice presidents of Air Canada, voluntarily wanted to return their share bonuses and units for valuation.

Former President and CEO Calin Rovinescu, who retired in February 2021, says he will also donate his share to the Air Canada Foundation.

The statement does not include middle managers, whose bonuses account for more than $ 8 million of the $ 10 million bonus program, among those who voluntarily offer their bonuses.

Finance Minister Chrystia Freeland on Wednesday expressed her displeasure over the million-dollar packages handed out to airline executives while the company negotiated a federal bailout and called the bonuses ‘inappropriate’.

The airline last Monday released its annual power of attorney circular to shareholders giving the bonuses to the investor document that was crucial to the airline’s continued existence over the past year, while air travel declined during the COVID-19 pandemic.

“Air Canada’s leadership is fully focused on Air Canada’s recovery from the COVID-19 pandemic and preparations to welcome returning colleagues and travel customers back as soon as possible,” the statement said on Sunday.

“The airline looks forward to working with all stakeholders, particularly the Government of Canada, in many areas, including the safe restart of our industry.”

In April, the airline and government agreed on a $ 5.9 billion loan package that includes money to help repay passenger tickets, but also a maximum compensation of $ 1 million up to 12 months after the loan is repaid in full.

The government also paid $ 500 million for a six percent stake in the country’s largest airline, which according to Freeland was done to ensure taxpayers could benefit once Air Canada’s revenue rises when regular travel resumes.

In early 2020, senior executives and 3,200 executives voluntarily agreed to a total reduction of $ 11.5 million in their base salaries, subject to compensation by stock appraisal units that would allow employees to recover from the forgotten salary as the share price in December 2022 rises higher. than in December 2020, the company says.

Freeland and Transport Minister Omar Alghabra said Canadians “expect legally responsible corporate behavior, especially with regard to executive compensation, from companies receiving financial support during the pandemic.”

“While Air Canada has been able to completely avoid this situation, we recognize this step in the right direction by the top five executives to repay 2020 bonuses and the rating units they received,” they said in a joint statement Sunday night.

The Canadian Press


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