Two days after the current 2019 Novel Coronavirus pandemic was officially declared by the World Health Organization, Edward H. Bastian — who is the current chief executive officer of Delta Air Lines — was quoted as saying on Friday, March 13, 2020 that “In light of these developments, I’m foregoing 100 percent of my salary, effective immediately, for the next six months” and “We are in discussions with the White House and Congress regarding the support they can provide to help us through this period. I’m optimistic we will receive their support.”
$12.36 Million in Compensation Earned in 2021 by Chief Executive Officer of Delta Air Lines
Delta Air Lines indeed did eventually receive that support in the amount of $4.5 billion dollars as a result of the Coronavirus Aid, Relief, and Economic Security Act — which is also known as the CARES Act and is an economic stimulus bill that totaled $2.2 trillion. The official financial results of the full year of 2021 reports that the airline earned a net income of $280 million dollars…
…and the total compensation for Edward Bastian in 2020 was $13,134,012.00, according to page 40 of the Schedule 14A statement of the Securities and Exchange Commission of the United States pertaining to the top executives of Delta Air Lines. Approximately 94 percent of that compensation was in the form of “at risk”, which means that most of that compensation was dependent on the performance of the airline and its stock price.
The actual salary for the chief executive officer of Delta Air Lines was $237,500.00 in 2020 as a result of the pledge to forego his salary. Delta Air Lines was struggling through the early months of the pandemic, as the airline significantly decreased its payroll through unpaid leaves of absence and cut the hours and total pay of many of its employees — as well as retired both the entire fleet of McDonnell Douglas airplanes and the entire fleet of Boeing 777-200 airplanes.
In 2021, the total compensation decreased by approximately $774,012.00 to approximately $12,360,000.00 — even though his actual salary was restored to $950,000.00 for the year. The compensation also included $4.1 million in stock, $4.1 million in stock options, $3 million in incentive pay, and $121,630 in other compensation. His stock award payout was approximately 50 percent of what he received in 2020 — but it was partially offset by incentive pay.
Final Boarding Call
The chief executive officer of Delta Air Lines is required to hold either a minimum of 400,000 shares of stock in the airline or shares which are equal to the multiple of the base salary — so he cannot sell or otherwise dispose of all of his shares of Delta Air Lines, which closed down by 36 cents at $42.67 per share at the closing bell earlier today, Monday, May 2, 2022. The stock price plummeted from $57.87 on Friday, February 21, 2020 to less than half its value of $21.35 per share on Friday March 20, 2020; and on Friday, May 15, 2020, each share was worth $19.19 — which was its low point over the past five years…
…so while I believe that what Edward Bastian did was generally a good gesture — he certainly was not required to volunteer to forego his salary for greater than half of the year 2020 — some people are incensed that he received a total compensation package of seven figures when the airline accepted the aforementioned $4.5 billion; and that some of the foregone salary was partially replaced with other incentives…
…especially as some people believe he has not done his best as chief executive officer of the airline — using as one example an e-mail message which was sent out to customers on Tuesday, July 27, 2021 as evidence in which he publicly apologized for the long times in which customers waited for service both via telephone and at airports, which was a result of failing to adequately staff both the reservation center and customer service center of the airline as demand for travel unexpectedly returned with a vengeance.
All photographs ©2007, ©2009, and ©2016 by Brian Cohen.
