Embattled aircraft maker Boeing said it was overhauling its bonus structure to more closely tie payouts to safety as it scrambles to recover from the Alaska Airlines door plug explosion.
Boeing employees, including managers and executives, will receive bonuses based on meeting safety-related performance criteria, according to an internal memo obtained by the company. Wall Street Journal.
This is a shift from the incentive plan unveiled by Elon Musk in his January financial filing, and over the past two years, Boeing executives have focused on improving diversity, equity and inclusion. It showed that people are increasingly receiving bonuses based on whether they meet their goals.
Boeing’s remaining nonunion employees, more than 100,000, were given bonuses based on financial incentives.
The memo, which was first circulated among employees, says the biggest changes will be in the company’s largest division, Commercial, which assembles machines such as the 737 Max 9, the model used on Alaska Airlines flights. It was said that the door was opened and closed. It was blown away at 16,000 feet.
An independent National Transportation Safety Board report found a key bolt was missing from the door plug, which had been removed to secure a rivet that had been damaged during manufacturing.
It was not immediately clear whether bonuses would be reduced for employees who overlooked the fact that the plane was missing critical parts. However, Boeing plans to reward employees who ensure that plane doors remain intact.
In the commercial sector, 60% of employees’ annual bonuses will come from safety and quality metrics, according to the Journal.
Criteria for determining incentives include employee safety, out-of-order work on assembly lines, and so-called rework needed to fix problems, the newspaper reported.
Previously, financial incentives accounted for the majority of annual awards, or 75%, with the remaining quarter tied to operational goals such as quality and safety.
At Boeing’s other two divisions, Defense and Services, three-quarters of employees’ year-end bonuses are still determined by financial metrics.
However, according to the Journal, the only factors that determine the operational score of these units are quality and safety.
Executives and managers who oversee all divisions, including CEO Dave Calhoun, will receive bonuses based on the average performance of Boeing’s three divisions.
A regulatory document circulating on social media in the wake of the now-infamous Alaska Airlines plane crash states that the airline giant will use DEI and climate targets, rather than employee safety and quality, as incentives for executive pay starting in 2022. It seems to indicate that
Elon Musk stole the economic momentum. “Would you want to be on a plane where he prioritizes DEI jobs over your safety? That’s what’s actually happening,” he told X in January.
Boeing’s move to prioritize safety was announced in a webcast this week, with Operations Director Stephanie Pope saying: customers,” Boeing told the Post.
The changes to the bonus structure come as part of the US Federal Aviation Administration’s crackdown on Boeing, which has given Boeing a 90-day period to develop a “comprehensive plan of action to address systemic quality control issues.” This was done immediately after being granted a grace period.
Reuters
Separately, the U.S. Department of Justice announced it was investigating the company’s role in the near-disastrous situation. Last month, an air door exploded on an Alaska Airlines plane, but luckily no one was sitting next to the door that blew out.
The Justice Department said it is determining whether the case falls under the government’s 2021 deferred prosecution agreement with the company.
If prosecutors determine that the door plug explosion constituted a breach of contract, Boeing could face criminal charges. bloomberg The report cited a person familiar with the matter.
Boeing also plans to begin negotiations with the International Association of Machinists and Aerospace Workers union on Friday, according to the Journal. The union represents more than 32,000 Boeing machinists in Washington state, including the 737 factory in Renton.
The union is seeking a 40% pay increase, the return of defined benefit pensions and a promise from Boeing that workers will build the next new jet within the next three to four years, the newspaper reported.
The proposed benefits are not a direct result of the plane explosion, but rather a controversial 2014 deal in which the union agreed to eliminate pensions and accept modest wage increases as the union sought to make up for years of losses. It is something.
At the time, IAM said the contract guaranteed that the wide-body 777X would be built in the Puget Sound region of northwest Washington, according to the Journal.
It’s not immediately clear what Boeing’s goals are in these negotiations, the first full-scale contract negotiations in 16 years since unions agreed to extensions in 2011 and 2014, according to the Journal. It wasn’t.
