Sun, Apr 23, 2017 - Page 16 News List

United CEO will not add chairman title as planned


United Airlines said chief executive officer Oscar Munoz, who came under withering criticism for the airline’s handling of a passenger-dragging incident, will not automatically add the title of chairman next year as planned.

The company on Friday said that Munoz proposed rewriting his employment contract to remove the expectation that he would become chairman at next year’s annual meeting of parent United Continental Holdings Inc.

United also said Munoz received US$18.7 million in compensation last year.

Munoz was widely faulted for his early responses to the April 9 incident on board a United Express plane in which he blamed the 69-year-old passenger who was dragged off by airport security officers.

Munoz later apologized repeatedly for United’s handling of the situation.

The incident is under investigation by the US Congress and the US Department of Transportation.

Lawyers for the passenger, Kentucky physician David Dao, have hinted at a lawsuit, and there have been calls online to boycott the company.

United executives said this week it was too early to know if the widely publicized incident has affected ticket sales.

Its board of directors has supported Munoz, according to a statement last week from company chairman Robert Milton.

United said in a securities filing that management and the board “take recent events extremely seriously,” and will link executive bonuses partly to “progress toward improvements in the customer experience.”

Munoz has said no employees will lose their jobs and that he will not quit. He ordered a review of the airline’s policies on moving crews and handling oversold flights, including bumping passengers, which is expected by the end of next week.

After being named CEO in September 2015, Munoz has focused on improving United’s tattered relations with labor unions.

The airline has made some strides in improving its on-time performance, canceling fewer flights and losing fewer bags, but it still generally ranks poorly in surveys of airline travelers.

Most of Munoz’s compensation last year was in stock. The company on Friday said in a regulatory filing that about US$6.8 million of the total was related to a signing bonus that Munoz was promised last year.

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