Smisek, who suddenly stepped down from his top spot at United on Tuesday afternoon, is going to make out incredibly well — so if you know him and he starts hitting you up for cash to buy some scratch-off lotto cards, don’t feel bad when you say no.
According to the airline’s SEC filing with regard to Smisek’s exit, his golden parachute includes:
• A lump-sum cash “Separation Payment” of $4.875 million.
• An “Annual Incentive Award” for fiscal year 2015 and other longer-term financial awards for 2013-2015 if the company meets certain performance targets.
• 60,746 shares of the company’s common stock. At the current stock price of around $56.70, that’s worth more than $3.4 million.
• “Flight benefits,” meaning the former CEO can continue to fly on United planes for free. He also gets free parking at United airport lots in Chicago and Houston for the rest of his life — and he’ll be parking the company car that will belongs to him after the airline transfers the title to his name.
For all this, Smisek agrees to not do anything for two years that would compete with United, nor can he solicit any United staffers or clients.
He also can’t disparage United, which he doesn’t have any reason to, since they are paying him well for his silence.
In all, Smisek could receive compensation worth upwards of $28 million — just for being let go amid accusations that his airline created an entire flight from Newark, NJ, to Columbia, SC, just to curry favor with the Chair of the Port Authority of New York and New Jersey, which operates United’s hub airport in Newark.
While it’s not uncommon for top executives to be paid gross sums for being bad at their jobs, some United employees aren’t happy that Smisek is getting off so easily.
“From the worker’s perspective, it’s obviously a different mentality,” a spokeswoman for the flight attendants’ union tells the Washington Post. “We believe there’s something wrong when an executive is awarded over $25 million for failing to do his job.”
by Chris Morran via Consumerist
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