Top Air Canada executives have waived their bonuses amid controversy in Ottawa.
“Air Canada’s vice presidents general and current president and CEO have voluntarily chosen to return their bonus and stock appreciation rights for the year 2020 voluntarily,” the company said Sunday evening in a statement.
Former Air Canada President and CEO Calin Ruvinescu, who retired in February 2021, will donate the value of his bonus and 2020 stock appreciation rights to the Air Canada Foundation.
“Neither a single taxpayer dollar nor money from the Canadian government sector financial support is used to fund bonuses for Air Canada employees or officers,” the airline said.
At the start of 2020, CEOs and 3,200 managers voluntarily agreed to a total cut of $11.5 million from their base salaries. The company said that this decline could be offset by the rights to raise the value of shares.
‘A step in the right direction’
“Despite the fact that this situation could have been avoided entirely by Air Canada, we recognize that this is a step in the right direction on the part of the five CEOs in terms of the remuneration payment and the units of recognition measures they have received,” said Canadian Deputy Prime Minister Chrystia Freeland. and Transportation Minister Omar Al-Ghubra in a joint statement, Sunday evening, for the year 2020. Canadians are right to expect companies to act responsibly — particularly when it comes to executive compensation — when receiving financial support from the government during the pandemic.”
Last Wednesday, Justin Trudeau expressed his displeasure with the payment of these bonuses. During the question period in the House of Representatives, he called on Air Canada to “clarify its decision and its reasons to Canadians” who were “shocked” to learn the news.
“We signed an agreement that limited, among other things, the salaries of CEOs […] We can see that perhaps even while Air Canada was negotiating its contracts with us, Air Canada was offering huge bonuses to CEOs, which is completely unacceptable.”
On Thursday, deputies unanimously approved a motion by Representative Xavier Barceló Duval.
“This Chamber deplores Air Canada’s senior management decision to award itself bonuses.” […] While the company has received nearly $6 billion in public aid,” the movement states.
The federal government and the company struck a $5.9 billion deal three weeks ago, largely in the form of loans. The agreement provides for compensation for customers whose flights have been canceled, as well as the purchase of shares totaling $500 million.
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