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Delta Says it is in “Dire Straits”, Requires Another Bailout After Paying Manager Bonuses

Delta Says it is in “Dire Straits”, Requires Another Bailout After Paying Manager Bonuses

An airline trade group that represents major U.S. carriers including Delta Air Lines is expected to tell lawmakers that the industry remains “in dire straits” and is in urgent need of billions of dollars more in government financial support. The plea comes just days after it was revealed that Delta paid out bonuses to an unspecified number of managers of as much as $250,000 in at least one case.

The one-off bonus payments, which were doled out to dozens of managers even as thousands of other Delta staffers have their paid working hours cut by up to 25 per cent, were first revealed by Gary Leff who runs travel industry blog View from the Wing.

Around 18,000 Delta workers also accepted buyouts or early retirements and around 50,000 took extended periods of voluntary unpaid leave to help the Atlanta-based airline through the pandemic. The high uptake of voluntary measures, along with salary cuts helped Delta avoid involuntary furloughs.

Chief executive Ed Bastian said it was an issue of “fairness” that managers should receive bonus payments even as the airline presses for more taxpayer funds to pay lower-paid workers. Frontline employees like flight attendants and airport staff will not receive a bonus.

“Fairness is one of the fundamental values we share at Delta, as is our mandate to always do right by our people,” Bastian told workers in a memo soon after the bonus scheme was leaked. “That’s why we made the decision to make a one-time adjustment payment to better align the percentage impact to overall compensation for everyone below the executive officer level.”

According to a Delta insider Grade 8-10 managers will receive $8,000, while a senior vice president could earn a windfall of as much as $25,000. General managers are set to receive up to $25,000, while directors could receive between $25,000 and $250,000 under the bonus scheme.

Bastian said the payments would return manager earnings to between 70 and 80 per cent of pre-pandemic levels. Manager salaries had been slashed by half at the start of the pandemic to help the airline cut costs.

But Nick Calio, president and chief executive of Airlines 4 America, a trade group that represents big U.S. airlines including American, United and Delta Air Lines is set to tell the House Transportation and Infrastructure’s aviation subcommittee on Tuesday that airlines deserve billions of dollars more in financial assistance.

Without a further $14 billion in taxpayer-funded payroll support, thousands of aviation workers will “lose their jobs — or experience reductions to wages and benefits — effective April 1,” Calio will tell the committee according to testimony seen by Reuters.

The “funding is an explicit recognition that the industry remains in dire straits, even before factoring in the certainty that it will be inundated with debt for years to come,” the testimony continues.

Delta alone has already received more than $5 billion in payroll support.

“As the company has not yet reached its zero daily cash burn target, and many employees are still shouldering financial burdens brought on by the pandemic, we find these bonuses are ill-timed and tone-deaf, especially for a management team that has stressed the need for shared sacrifices throughout the pandemic,” Jason Ambrosi, chairman of the Air Line Pilots Association unit at Delta noted.

Delta plans to slowly start bringing back pilots who were put onto ‘inactive status’ later this month but the process to get every pilot back to work won’t be complete until the fall.

Photo Credit: Jan Rosolino via Unsplash

View Comments (34)
  • Giving out bonuses to executives while cutting the little folks out and then wanting another bailout? I fully expect the Biden administration to fall for that lie.

    • It would be Congress that would approve the bailout, not the POTUS. We’re you also upset when United was bailed out last year, while Trump was POTUS?

  • They’ve received billions and want more, at the same time rewarding management staff up to a quarter of a million dollars? As a retired DAL f/a I’ve always seen right through the mess the company puts forward. My proposed solution. 1) Get rid of Bastian, 2) Unionize. Very simple.

    • You’re so full of Mis-information..go be another sheep in the heard of Unionized F/A worker’s…There’s a reason Delta just got Named #2 Airlines… IN THE WORLD

      • Jerk wad, when you spend decades @ DAL you are well aware what goes on. The “family” may be scared to say anything but trust me, they know. Love how you call me a sheep. Sounds to me like you’re just upset that loser orange man is, in fact, a loser, crying his eyes out in Palm Beach. baaaaaaaa.

        • Petty childish name calling is all the desperate left has. You managed to cram two into your posting. Firing Bastian would not solve this done deal, and it is delightful.tjat you still have Trump living in your brain 24 hours per day. No wars, prosperity, ISIS gone , wages up, taxes down and gas prices 20-30% lower than now.

  • This is a little misleading… The people who got bonuses had their pay cut for the last year in order to ensure front line workers could be paid, they aren’t just getting a bonus, this is making up to the managers that sacrificed pay for the last year.

    The bonuses also aren’t why they need money, they need money because travel hasn’t rebounded yet, especially lucrative business travel. If they didn’t pay out these bonuses, that would buy them about anoyher day or two.

    • Bottom line NO BONUSES should be given out when you’re asking and receiving a bailout! Front line workers are always screwed over. Bastien should give up his salary and stock options to help Delta and the employees during the pandemic.

      • Ummm he did and still is giving up his salary. And the managers in question gave up half of their salary for a year to help the airline as a whole be able to get paid. Frontline workers are already back to 40 hour pay and that’s because of good leadership. Don’t believe everything you read. This is just one perspective. I am a 2nd generation Delta employee and I can tell you that we would not be here if it were not for our leadership team.

  • They have passengers with negative CO-Vid tests that they aren’t having as customers because countries like the Netherlands haven’t given “permission” to them to enter even though they aren’t a health risk…..people who don’t have covid-19 can’t enter the country and fly their to see their family and Delta is supporting this request. That’s a joke….Delta needs to pull their flights from the country. A negative test result is what reduced the spread not what your reason of entry is. That’s preposterous and ridiculous and as long as you are going to cut your own revenues by supporting that idiotic request Delta you don’t deserve any bail out. Grow a pair and help your own economic strain and force countries with these ridiculous travel restrictions to do the right thing…..a negative test result. Not this letter from the embassy or consulate that meets a reason acceptable by the EU govt…..when these sanctions are in place simply because the EU is upset that the USA is controlling the vaccine distribution. The EU is slitting their own throats with a nearly 75% tourism decline.

  • Just keep bailing them out..forever.Our congress are idiots.They had to take a pay cut so we gave them a hoo..most of us lost our jobs or companies went under.We certainly can’t have our airlines to suffer at all.They are special

  • Maybe they should stop banning passengers over nonsense theater. Just a thought. I wonder how far they money they turned away over mask stupity from their moronic banning policy could have helped. 700 pax isn’t anything to scoff at.

    • Sounds like you’re one of the actors Delta laid off 🤣. Mask up or fly someone else. Delta doesn’t need your drama.

  • Frontline employees gave up 25% of their pay to help Delta. Pay Grades 7 and below gave up 25% as well. Thousands took early offers to help save the airline. Many haven’t received approved unemployment which they are entitled by now. Large bonuses have been awarded annually to this same classification of employees for many, many years. The pandemic should have mandated a change to this discriminatory practice. An analysis of the pay grades at Delta indicates that only a handful of the managers, Pay Grade 8 and above, are classified as non-white. Meaning, nearly 92% of the bonus (more than $650 million) goes to mostly white employees.

    The Biden Administration should not award Delta or any other airline taxpayer funds, unless or until every employee is offered reinstatement at their last salary or wage and seniority level. This country is always profiting on the backs of the low-income. The shear number of low-income workers make this practice affordable to large companies. An internal investigation should be conducted before another penny is awarded to Delta.

  • As far as I understand from my research these were not bonuses. Also I understand Delta didn’t take the bailout in the first round and didn’t furlough any US based employees. And was the only airline in the US to do that.

  • The clickbait headline pulled all of you trolls in and the only thing this article accomplishes is to make the author ad money. The headline states “Delta” said they are in “dire straits” and then the first sentence literally says “a airline trade group that represents major US carriers” is messing this claim. The reality is that Delta has made good on salary cutbacks to help retain management talent that they have been losing over the last year to non-airline companies given the tough times this industry is facing. To call what Delta is paying out a “bonus” is a far cry from the yearly success sharing it has paid out to ALL employees pre-pandemic. The government has made it incredibly challenfing for the airline and hospitality industries to stay afloat with their inconsistent and unfounded “health” mandates. Meanwhile “essential” businesses like Target, Walmart, Amazon, Home Depot have had record setting years. Where is the outcry for those businesses to invest the majority of these windfalls that are leading to huge bonuses/stock grants tonbe paid in the next month to frontline employees instead of their non-diverse corporate leaders?? And the whole POV on Bastian… he had been taking no pay since the compant pay reductions went into effect. Do some research and fact checking before you buy into this biased and misleading garbage.

    • You’re not the only insider who wants the truth to be told. Except, you’re being feed talking points by leadership.

  • Delta does what Delta can do. I’m certain that pay concessions for flight attendants or layoffs are in the future, especially with variants that affect young people and those who are not getting vaccinated.
    There’s not much any company can do in this mess.
    Bastian has the capacity to do the best, and Delta has always done that, with the exception of managing their flight attendants unwelcome verbage to customers.
    Delta will prevail, and they can start by laying off on the unwelcome ugly sass towards customers.

  • This is borderline libelous. Delta is a member of Airlines 4 America, but Delta did NOT say they were in a perilous situation. Their trade association, speaking of the industry as a whole, stated the industry remained in a perilous situation.

    This headline needs to be changed ASAP.

  • The staff was taking 50% paid cut. The full time employee was paid part time salary with full time benefit. If they give bonuses to the management, its should be share with all the staff that was working. Many of airline staff die of covid, or got covid. It’s was never in the news. It’s hard time for the travel industry

  • I am one of the people that received what this article calls a bonus. I started at Delta two years ago, as part of salary negotiations Delta considered 10% of my pay to be variable, based on performance. If you remove that 10% variability I took a pay cut to join this company. That 10% is considered part of base pay not a bonus. At this level you are expected to perform, and if you don’t pay is taken away. Bonuses are paid on top of that based on profitably. We obviously did not receive this bonus.

    Last year everyone essentially took a 25% pay cut, managers and frontline employees. But then managers also weren’t paid the variable portion of their pay. This means managers, who were working 40 hour weeks on 30 hours pay (as did many non-managers), ended up having a 35% pay cut.

    There are plenty of pay grades in Delta that pay the equivalent of the manager level salary, but aren’t performance based. Those people only lost 25% of their pay. When this was pointed out, Delta did what they always try to do…make things right by their people. We all win together, we all suffer together.

    As for myself I also voluntarily took a leave of absence. Even with the pay correction I made only 65-70% last year of what I agreed to when I was hired. I choose to do that because I believe in the company, if I didn’t I’d go somewhere else and make a lot more money.

    Not everything is a conspiracy.

    • Two year employee. Oh please. You’re just a baby. Talk to the employee that has been there for decades. There are TONS. Your mommy and daddy weren’t even born when they started.

      • Assuming much? I’m 47. Many of my friends here are lifers with 20-30 years experience. I talk to them regularly.

        My parents were born in the 1940s.

        Did you have an intelligent point to make or just feel a need to make yourself look silly?

      • They flat rated the amount, so the percentage it works out to would vary based on each person’s base pay. For me it worked out to about 60% of what I contractually should get.

        • “salaried” employees pay is not based on 40 hours per week. It is a salary not an hourly pay ! And you sir, are a perfect example of the problems with present day Delta, hiring from outside for the big money jobs while promotion from within, which served the company wonderfully for more than 3/4’s of its existence is the new norm since the “carpetbaggers” have invaded the south for the 2nd time in history ! And I believe that when all industries recover that you will bolt the company for a higher salary. 2 years has not proved your loyalty to Delta.

          • I never discussed anything about salaried vs hourly pay. I’m well aware of how that works. People on salary are paid to accomplish their work…many work less than 40 hours a week. How is this relevant?

            I was hired for a job that sat on an internal posting for months. I have a technical speciality that is rare in the whole country. I actively pursued a job a Delta (turning down offers from Amazon, Google, and Facebook) because I wanted to work for Delta. I took a slight pay cut to come here.

            I literally chose to come here for my next job because of those people who have been here forever going above and beyond for me on a business trip that went sideways.

            I get job offers for higher pay nearly every week. Instead of taking them I chose to stay because I believe I can help. Why would I leave in two years when I could leave any time I choose?

            My first weeks here I insisted on bringing in a couple ACS below wing guys to our IT project since we were working on tech for them. I’ve been out and worked a plane with ALAs to learn that business and testvwhat wevwere building (I’m one of the only IT people I’ve met with a SIDA badge for ATL), currently I am working with FAs and pilots to improve their tech. I’ve helped TechOps and Cargo troubleshoot some of their problems. I’m lucky enough that my team works across all divisions here.

            Because of that I’ve seen the problems. There are many! I am currently fighting to get a below wing person promoted into a tech job that I’ve helped teach him how to do. I believe in promoting from within, but on the IT side that only works if internal employees are willing to take the time to learn the latest technology.

            Like you mentioned, I’ve seen some positions that should have been hired from within. I agree that it is a problem.

            Nowhere in any of my posts have I suggested there are not problems. All I am saying is in regards to this article this isn’t a bonus, and at the very least in my case still leaves me with a bigger pay cut than those not on this type of compensation program. I’m okay with making a less on a percentage basis. I have worked very hard to get to where I am in life, but my job will never be as physically difficult as loading a plane in -10 degree weather in MSP…which I’ve done while trying to make sure scanners worked in freezing temps.

            If you still feel I’m a perfect example of the problem, I’d ask how would you handle hiring for a position that no one in the company would even apply for? And if you did have to go outside the company what would you look for in a potential Delta employee?

            If there wasn’t anyone available internally for a position, wouldn’t you want someone like me, who isn’t here for the money and genuinely wants Delta to succeed, to come in?

  • People have a total misunderstanding of corporate pay structures. They see the word bonus and think that it must be something extra. When in fact it’s pay, it’s just labeled a different way. These employees have taken a pay cut year over year. The author of this article is an idiot and obviously has no understanding of modern pay structures.

  • I HATE CLICK BAIT! Delta didn’t say shit…the trade workers group did. And who said that group represents DAL, the author of this click bait article? Find something write about!

  • How about those that have been employees (non contract) with the company more than 2 years, who have also taken 50%+ pay/benefit cut and have never been restored to previous pay. Apparently the only way for them to be fair with all the employees is to get it in writing. Some employees have the option to negotiate their salary, which is great! Then there are those that get taken advantage of because they are not represented or protected by anything in writing. These pay corrections are being taxed as bonuses, btw.

  • This is a terribly misleading article. Trash clickbait and I won’t be visiting this webpage again

  • They need to stick with 777s & 787s that way the pilots can get training for both planes at the same time.also they need to do away with overbooking & flight bumping which would make them look better.

    • Trust me. Regarding sticking with certain aircraft types, overlooking and bumping, etc.: They may have alot of problems but they don’t need an armchair person to tell them how to solve those types of issues. This isn’t their 1st rodeo. Stick to what you do and know. They don’t need your input.

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