Times are turbulent for airlines right now. Many are in the process of massive layoffs or have asked their staff to take unpaid leave in order to slow the rate of cash burn. Most would agree that ‘good leadership’ is one that leads by example. To that end, here is a list of airline CEOs that are currently working without a salary during the COVID-19 pandemic.
“The only way to make an employee-wide pay cut possible is if management leads by example.” -Michael Maslansky, CEO of communications advisory firm maslansky + partners via Bloomberg
Below is a list of CEOs and their airlines who we know will not be taking any portion of their salary during part or all of this crisis. We’ll include additional information or quotes where applicable:
AirAsia CEO Tony Fernandes: Fernandes announced in April that he and Executive Chairman Kamarudin Meranun “will not be taking a salary during this period.” Other airline staff “have accepted temporary pay reductions of anywhere between 15-75%, depending on seniority, to share the impact this is having on [their] business”.
airBaltic CEO Martin Gauss: Gauss will not receive any of his €1.3 million ($1.42 million) salary throughout the crisis.
Air Canada CEO Calin Rovinescu: A spokesperson confirmed with us that Rovinescu, as well as Michael Rousseau, Deputy CEO and CFO, are currently waiving 100% of their salary given the impact of the COVID-19 pandemic upon the company.
Alaska Airlines CEO Brad Tilden: Both Alaska Airlines CEO Brad Tilden and airline President Ben Minicucci have reduced their base salaries to zero. This was announced in a regulatory filing on March 16, 2020, but was effective from March 7, 2020.
British Airways CEO Alex Cruz: The head of BA decided to forego his salary for two months, beginning late March. This means that decision will ‘expire’ at the end of this month. There is no news as to whether or not he will continue foregoing his salary.
Delta CEO Ed Bastian: In early March, Delta’s CEO wrote a letter to his employees saying, “I’m foregoing 100 percent of my salary, effective immediately, for the next six months.” An airline spokesperson adds that all of Delta’s officers have also taken base pay cuts of 50%, and managing directors and directors have had their base salaries reduced by 25%.
Emirates President Sir Tim Clark: The head of the Dubai-based carrier said he would forego his salary for three months from late March.
Jazeera Airways CEO Rohit Ramachandran: The airline’s CEO isn’t receiving a salary at all while the airline’s entire management team has taken a 50% pay cut since February.
Qantas CEO Alan Joyce: Joyce will take none of his AU$23m ($15.5m) salary for the rest of the year. He is joined by chairman Richard Goyder and has said that upper management and board members will be taking a pay cut of 30%.
United Airlines CEO Scott Kirby: An SEC filing states that Kirby’s salary cut began on March 10 and will go through the end of the year. Kirby began his role as CEO this month. Starting on March 16, Mr. Brett Hart waived 50% of his base salary in his role as the Company’s Executive Vice President and Chief Administrative Officer and, in connection with his transition to the position of President, has waived 100% of his base salary from May 20, 2020, through the end of the year.
One interesting note is reserved for Doug Parker, the CEO of American Airlines. A few years ago, Parker elected to forgo salary and bonuses and instead gets paid solely in ‘equity awards’, according to Bloomberg. Equity awards include options, restricted stock, and performance shares.
Less than 100%
There are many airline heads missing from the above list. Many have made the decision to keep a portion of their salary. This ranges from 10% and 15% reductions such as Gary Kelly of Southwest and Greg Foran of Air New Zealand respectively, all the way up to the 80% pay cut of Kenya Airways’ CEO Allan Kilavuka. Ed Simms and the executive team at WestJet, and Michael O’Leary of Ryanair fall right in the middle at 50%.
JetBlue’s CEO Robin Hayes was one of the first to announce a salary cut, advising a 20% pay cut in March. However, JetBlue has told Simple Flying that this reduction has now been increased to 50%. Other JetBlue executives have also taken salary cuts in a bid to preserve the airline’s cash flow.
On the lower end of the scale we find a number of chiefs that have settled on a 20% salary reduction. These include:
- Andrés Conesa of Aeromexico
- Willie Walsh of IAG
- Pieter Elbers of KLM
- Shai Weiss of Virgin Atlantic
- Finally, while Lufthansa CEO Carsten Spohr hasn’t been singled out in news sources, we do know that the airline’s senior management will take a 20% pay cut. Presumably, Spohr is included in this as well.
And then there’s Air France-KLM head Ben Smith, who is taking a 25% pay cut while Singapore Airlines’ Goh Choon Phong and Cathay Pacific’s Augustus Tang are both on record as foregoing 30% of their salaries. Tang’s commitment runs through to December.
It’s challenging to make a judgment one way or another for those still taking a salary. After all, these people also have families to support and bills to pay. But without a doubt, those at the bottom of the airline’s organization are much, much closer to financial hardship.
Therefore, it certainly is admirable that some have made the decision to forego 100% of their pay. While it’s certainly not enough to save airlines, moves like these have more value in their principle and symbolism.
Certainly, if and when these executives ask more of their employees, those same workers will be responding to their leaders, asking, “and what sacrifices have you made for your company?”
What’s your initial reaction to reading this list? Does it change your opinion of some airlines and their leadership? Let us know in the comments! (Also, please let us know if we’re missing anyone.)