Boeing Grants Vested Shares To Some Employees; Halts Merit Pay Raises
Boeing Co has said that it is suspending annual merit salary increases in 2021 for most employees, managers and executives, as the embattled US plane maker grapples with fallout from the coronavirus pandemic and 737 MAX crisis.
Boeing also said that it is awarding employees - excluding executives and tens of thousands of engineers and machinists covered by union contracts - a one-time grant of Restricted Stock Units (RSUs), determined by level.
The mixed bag of news, delivered just before the US holiday break in a memo to employees from chief executive Dave Calhoun, caps a year in which Boeing has shed thousands of jobs and cut production as it looks ahead to a recovery still years away.
"The next chapter of our history will be built on a culture of excellence anchored by shared accountability and ownership," Calhoun told employees.
The grant, which is the first of its kind at Boeing in recent memory, will be awarded to approximately 82,000 employees and will vest three years from the grant date, Calhoun said.
Boeing said days earlier that it is cutting production of its 787 Dreamliner for the fourth time in 18 months after posting zero deliveries in November, as recent production flaws compound delays from the COVID-19 crisis.
The pandemic decimated air travel and jet demand just as Boeing was working to win regulatory approval to return its best-selling jet, the 737 MAX, to the skies after a worldwide ban following crashes in Ethiopia and Indonesia that killed 346 people.
The MAX is expected to resume US service later this month following flights in Brazil and Mexico.
In late October, Boeing said that it was eliminating approximately 30,000 jobs to reach a workforce of approximately 130,000 by the end of 2021 - thousands more than previously discussed.
Calhoun has predicted that airline traffic will end the year at approximately 30% to 35% of 2019 levels, with a return to pre-pandemic levels in about three years.
Expecting to Emerge As A Better Company
"I know we will emerge from this a better company, one that is recognised for safety, transparency and quality," Calhoun told employees.