Hawaiian Air gives
employees $3M bonus
The payout was part of concession
agreements and equaled 10% of
the $30 million by which the company
exceeded its operating profit forecasts
Hawaiian Airlines employees, who have had to endure the uncertainty of the company's bankruptcy filing after earlier agreeing to labor cost concessions, are getting early Christmas presents from Hawaiian in the form of $3 million in profit-sharing bonuses.
The carrier, which agreed to the profit-sharing plan in the spring as part of its negotiations for union and nonunion employee concessions, said yesterday it exceeded by $30 million its operating profit forecast for the nine-month period from April through December 2003.
Hawaiian said that at the end of September it already had generated $54 million in operating profits, easily topping the nine-month forecast of $24 million it made in the spring. The $54 million doesn't include a one-time $17.5 million grant from the Transportation Security Administration for the suspension of passenger security fees from June 1 through Sept. 30 and costs associated with installing strengthened flight deck doors and locks.
Under the concession agreement, 10 percent of the profits above the forecast -- which in this case represents $3 million of the $30 million -- will be paid out as a bonus. Most employees are expected to receive the bonus this month. The payout doesn't have to be approved by U.S. Bankruptcy Court because it was part of the collective bargaining agreement.
The $3 million is being allocated among participating employees on the basis of wages, with a minimum payment of $100 before taxes. Hawaiian said figures for average payout and maximum payout were not immediately available. The program excludes company officers.
"Hawaiian Airlines has enjoyed an extraordinary six-month period," Hawaiian trustee Joshua Gotbaum said.
The airline, in fact, has shown an operating profit every month since it filed for Chapter 11 reorganization on March 21.
Hawaiian's profit-sharing agreement, which continues through June, will result in additional bonuses to employees if the airline's operating profit exceeds the amounts projected in its labor negotiations. Those payouts could occur after the current quarter, incorporating any excess above the forecast from Oct. 1 through Dec. 31, as well as after the March 2004 and June 2004 quarters.
"There are no guarantees about the future, but if we continue to do well, then everyone who participated will benefit," Gotbaum said in a note to employees.