Delta's Retention Program isn't working

[altimaklr]

Here's the story...

 

[Timebuilder]

In the world of business, it takes big money to keep key executives. In this case, perhaps not enough money.

 

[altimaklr]

In Delta's case, it was about $1.8 million per employee.... if that's not good enough, what is?

 

[Timebuilder]

Just watch where they go for your answer.

Is this another "class warfare" post???

This reminds me of the hurt feelings I had when I was a young radio announcer. As an "on air personality" I was one of a dozen or so people that actually put the station on the air. I was the literal voice of the station when I was on duty. My pay, and those of the other jocks, was the LOWEST of any at the station, except for the part-time secretary. It was the account executives, the "salesmen" and their bosses who made the real cash. Note that this was the number one rock station in the fifth largest market in America.

As pilots, we may feel that WE alone should get the big bucks, but that is NEVER the case in the business world. The big cash goes to the overseers, the deal makers, the "movers and shakers".

As long as there is an oversupply of pilots, pilot wages will descend even further in a competitive environment. Expereinced executives, on the other hand, those with top level experience at major corporations, are harder to come by (and retain) and command not aircraft, but high salaries and benefits.

So, if you want the big money, transfer out of your flight program and work hard to get into the Harvard, Penn, or NYU business school.

Then, call me to fly your airplane. I could use a job.

 

[jarhead]

I am having a "disconnect" with something in this report of Delta executives bailing out with the money that was designed to keep them on board. Would it have not been possible to design the program, so that leaving Delta prior to some date(pick it), that the money would be forfeited?

On the other hand, I find nothing wrong with the stockholders of any company, through their elected board of directors, to establish compensation packages to keep top talent from leaving the stable. On the other hand, perhaps with the billions of $$$ in losses going down the toilet, I can't see that these current crop of executives are worth much at all. I believe I could lose money just as fast, for a fraction of the dough these guys are being paid. Maybe they need a "new broom to sweep clean", instead of hanging on to folks who can't run it for a profit. Some airlines are managing to do it.....why can't Delta?

 

[NYRANGERS]

I am having a "disconnect" with something in this report of Delta executives bailing out with the money that was designed to keep them on board. Would it have been not been possible to design the program, so that leaving Delta prior to some date(pick it), that the money would be forfeited?

Yes they could have. All management did was find a tricky way to issue bonuses under the guise of pensions and a retention program. For any of these crooks to get "their" money, they just have to make a request for it and they get the check three days later.

There was a pretty good segment on CNBC about this (this morning). It was the first time I have seen a reporter and AJC reporter claim they understand why our union is asking for protections before concessions.

Fly safe,

NYR

Kind of funny how just a few months ago when M. Burns was asked about this she said........"oh, thats old news"...........as if that was some kind of defense.

 

[Timebuilder]

On the other hand, perhaps with the billions of $$$ in losses going down the toilet, I can't see that these current crop of executives are worth much at all. I believe I could lose money just as fast, for a fraction of the dough these guys are being paid.

The reason that guys like this have to be employed instead of you and I is that these guys are recognized "players" in the business community, and you and I are not. Had I stayed in the NYU business school instead of switching over to the School of Arts, I might be one of those players now. No thanks.

These recognized players are a necessity for banks, creditors, and vendors to work with Delta during these hard times. You and I might be able to arrange a meeting with these people, but conversation would certainly reveal that we had no known track record of guiding a major corporation, and we would not be extended the same arrangements that these known, experienced players would receive.

Maybe they need a "new broom to sweep clean", instead of hanging on to folks who can't run it for a profit. Some airlines are managing to do it.....why can't Delta?

Most likely: costs vs revenue.

 

[Timebuilder]

All management did was find a tricky way to issue bonuses under the guise of pensions and a retention program. For any of these crooks to get "their" money, they just have to make a request for it and they get the check three days later.

This is where the board of directors in particular and the stockholders in general need to exercise their ultimate authority, as the "ownwers" of the corporation. While we can call something "sneaky", we have to remember that everything that happens at a company has someone who is responsible for it's execution. When poor judgement or illegal accounting are discovered, executives need to be brought up to either give a full explanation or face justice.

If you are a Delta stockholder on any level, this is your opportunity to make yourself heard, both through letters and the annual meeting. YOU, as a stockholder, are an authority to be reckoned with, and it is up to YOU to bring pressure when you feel that something wrong is afoot.

 

[surfnole]

I don't think Delta will have any problems finding willing and able takers for their jobs. This sounds more like a sweetheart deal for the Delta mgmt.

Isn't this the same mgmt that lost hundreds of millions of dollars on the Comair strike? They could have given the pilots at Comair everything they wanted and still saved a ton of money.

 

[jarhead]

surfnole

What? Do you mean to infer that it was not the Comair Management that was pulling all the strings during the strike?
You think it was not Randy and Seibs conducting that symphony?
I am stunned!

 

[~~~^~~~]

In information presented by Fred Reid last week at his Delta Pilot "Town Hall" meeting, he said his executives are paid about 10% of the industry average. He cited examples at the bankrupt carriers, like Tilton at UAL, who makes 200 million and Dave Siegal at US Air.

European airlines have been making them offers well in excess of what Delta is paying.

Kind of takes the wind out of the DMEC's arguement that these executives are overpaid, corrupt, fat cats who don't need retention bonuses because no one would hire them.

 

[surfnole]

In information presented by Fred Reid last week at his Delta Pilot "Town Hall" meeting, he said his executives are paid about 10% of the industry average. He cited examples at the bankrupt carriers, like Tilton at UAL, who makes 200 million and Dave Siegal at US Air.

I am by no means an expert on this industry. However, isn't Delta the most financially sound of all the majors? Perhaps one reason is because they hold down the salaries of their mgmt while everyone else chooses the path to bankruptcy.

Aren't European airlines subsidized by their government.

 

[jarhead]

I would submit that after 9-11, and the billions doled out to the major airlines by the tax payers in the U.S., that Europe does not have a monopoly on government subsidized carriers.

 

[FlyingSig]

In information presented by Fred Reid last week at his Delta Pilot "Town Hall" meeting, he said his executives are paid about 10% of the industry average. He cited examples at the bankrupt carriers, like Tilton at UAL, who makes 200 million and Dave Siegal at US Air.

European airlines have been making them offers well in excess of what Delta is paying.

Kind of takes the wind out of the DMEC's arguement that these executives are overpaid, corrupt, fat cats who don't need retention bonuses because no one would hire them.

Fins,

I addressed this misinformation that you also stated in another thread. You ignored it there, care to answer it here?

http://forums.flightinfo.com/showthread.php?s=&threadid=20996

 

[surplus1]

jarhead

I love it when you "wax sarcastic".

surfnole

Maybe they saw what you call "a ton of money" as a drop in the bucket.

Based on what "they" say the strike cost them ($680 millions) over 89 days and what I think in would have cost ($50 million over 5 years) to give the Comair pilots "everything they wanted" the net difference was a mere 630 millions of the shareholders money that was thrown away.

It's amazing how a ton of money can be seen as a pittance when its somebody else's money.

 

[jarhead]

Surplus1

I am glad you can see my sarcasim when I use it. It tends to be in my nature, but I sometimes worry afterwards, that it may not be picked up on by some, as to what it was

 

[Be200pilot]

a post regarding delta that lacks a response from general lee? weird.....

 

[skykid]

Do you really believe any airline executive makes 200 million a year? Bill Gates might make 200mil this year if you added up all his income, maybe.

 

[skykid]

We all know that executives get perks and signing bonuses - these will be hard to quantify on a yearly basis since their impact may span the whole time the CEO is at the helm. If you look at Tilton's base salary for 2003, the number quoted from whatever town hall meeting was off by 199,154,500.

 

[Birdstrike]

$5 Billion Short?

Posted from the referenced article:

"...Delta's employee-pension obligations are underfunded by about $4.9 billion..."

That is a significant chunk of change. Anybody know what percentage of the total obligation that is? If the paradigm truly shifts and and Delta's current furloughees end up returning to a job financially less lucrative than the one they left due to a permanent fall-off in revenues, how is that obligation ever going to be funded? If management can solve that one, then maybe they are worth something.

 

[N2264J]

Re: $5 Billion Short?

Posted from the referenced article:

"...Delta's employee-pension obligations are underfunded by about $4.9 billion..."

That is a significant chunk of change...If management can solve that one, then maybe they are worth something.

I suspect that ASA and Comair pilots find the Delta pilot's demand to management somewhat insincere that concessions from "all stakeholders" be obtained to, in effect, help pay that $5 billion dollar retirement bill.

I could be wrong but I don't think that debt is the responsibility of the ASA or Comair pilots.

 

[jarhead]

Not to worry......The Pension Guarantee Trust Corporation (translated: U.S. Taxpayers) will be required to make up most of the shortfall.

 

[N2264J]

Re: $5 Billion Short?

Not to worry......The Pension Guarantee Trust Corporation (translated: U.S. Taxpayers) will be required to make up most of the shortfall.

Ah yes. They'll stick it to the tax payers...hey, wait a
minute - that's me!