United Airlines tied $500,000 CEO bonus to customer satisfaction results

The manhandling of a doctor dragged off an overbooked United Airlines flight in Chicago—and CEO Oscar Munoz’s response—doesn’t figure to help his cause


United Airlines CEO Oscar Munoz has 2016 target compensation of about $14.3 million, according to his employment agreement. Photo: Reuters
United Airlines CEO Oscar Munoz has 2016 target compensation of about $14.3 million, according to his employment agreement. Photo: Reuters

New York: Angry United Airlines customers can now vent their fury at a juicy target: the chief executive’s pocketbook.

United ties about $500,000 of CEO Oscar Munoz’s annual bonus to customer satisfaction questionnaires. The manhandling of a doctor dragged off an overbooked flight in Chicago—and Munoz’s response, widely viewed as ham-handed—doesn’t figure to help his cause.

Each day, United collects about 8,000 customer surveys on items such as legroom and the quality of in-flight coffee. Fliers were already pretty disgruntled. In 2016, researcher J.D. Power rated United dead last of traditional North American carriers. Early returns are now even less promising.

“United Airlines just sent me a customer survey about my flight yesterday,” Meredith Tucker deadpanned on Twitter after the overbooking episode. “Looking forward to sharing my thoughts.”

Of course, Munoz won’t be begging on street corners if he’s docked the half a million. The CEO has 2016 target compensation of about $14.3 million, according to his employment agreement. The actual amount for last year is expected to be disclosed by month’s end.

In a filing, the company’s board said executive pay is “designed to further our objective of aligning the interests of our employees with those of our stockholders and customers.” United declined to comment.

Hashtag: awkward

Southwest Airlines Co. also ties part of CEO Gary Kelly’s bonus to a measure of customer loyalty. Delta Air Lines Inc. links a part of CEO Ed Bastian’s annual long-term stock award to customer service.

At the airline officially known as United Continental Holdings Inc., the board mentions “customer satisfaction” in the pay filing no less than 20 times. The company didn’t specify exactly how that’s calculated, though the bonus is tied to improvement of the survey results.

Presumably, dragging customers out of their seats won’t help. A Twitter wag named Joe Householder wrote, under the hashtag, #awkward: “Based on experience, the guy on the #united flight is getting his, ‘tell us about your trip,” email survey about now.”

Another Twitter commentator said he actually received one, which asked, “According to you, why do we consider ourselves the best airline to fly with?”

His answer: “beats me.” Bloomberg

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