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The United State's No. 3 airline has
promised its employees they will be rewarded
when the carrier emerges from bankruptcy
later this Spring. After a series of deep
pay and benefit cuts since 2004, Delta Air
Lines employees are about to get improved
pay and cash bonuses. The airline sent a
letter to all employees in early March that
outlined broad outlines of what they might
expect when the Atlanta-based carrier emerges
from bankruptcy status. Delta's letter did
not cite any specifics regarding the augmented
pay or the size of the cash bonuses or stock
grants being planned. However, the airline
did disclose that it would be instituting
a profit sharing plan to distribute 15 percent
of its pre-tax income.
In the letter, company officials also
described how all employees would receive
a lump sum cash bonus equal to a percentage
of their pay once the airline emerges from
bankruptcy. Employees will also receive
a grant of unrestricted stock that they
will be able to sell without restrictions.
The airline's 1,000 top executives will
be granted restricted shares, options and
performance shares. The company said the
pool of money that Delta has allocated for
merit pay raises would be distributed based
on performance and current pay position.
There will also be new retirement benefits
into defined contribution plans. The company
terminated the traditional pension plans
for pilots while it was in bankruptcy. More
than 80 percent of Delta's employees are
not union members.
“We're moving towards an industry-standard
pay structure to ensure your pay rate becomes
and remains competitive with network and
low-cost carriers, including American, United,
AirTran, JetBlue and Southwest,” said the
company's letter. “While we won't be able
to do that all in one step, we'll take the
first step in that direction this summer
- and officers and directors won't have
any across-the-board pay increases until
all those steps are complete,” the letter
continues.
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Delta imposed or reached concession contracts
with unions that saved $1.6 billion in labor
costs in 2004 as it struggled to avoid bankruptcy,
but a year later rising fuel costs forced
it into bankruptcy court. While in bankruptcy,
it won or imposed an additional $930 million
a year in labor cost cuts. Delta had 55,700
employees as of its most recent filing with
the bankruptcy court.
See For
Yourself
We invite you to enjoy the accompanying
selection of video scenes showcasing
Delta Airlines jets in action. The
footage was filmed at the carrier's home
base (and one of the World's busiest
airports) at Atlanta's
Hartsfield-Jackson International
Airport.
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