Air Canada’s (TSX:AC) senior executives are returning the bonuses they received last year (2020) in response to what the airline called "public disappointment."
The Montreal-based carrier said in a news release that Air Canada’s chief executive officer, as well as executive vice-presidents, will return their bonuses. Former Air Canada CEO Calin Rovinescu, who retired in February of this year, says he will donate his 2020 bonus to the Air Canada charitable foundation.
The statement does not include middle managers, whose bonuses made up more than $8 million of the $10-million bonus program, among those who are returning their bonuses.
Federal Finance Minister Chrystia Freeland signaled her displeasure over the multi-million-dollar packages handed out to the airline's executives as the company negotiated a federal bailout, calling the bonuses "inappropriate."
The airline last Monday disclosed its annual proxy circular to shareholders that gave the bonuses to people the investor document called "instrumental" in the airline's survival over the past year as air travel plunged during the global pandemic.
In April, the airline and government agreed to a $5.9-billion loan package that includes money to help refund passenger tickets, but also capped executive compensation at $1 million until 12 months after the loan is fully repaid.
The government also paid $500 million for a 6% stake in the country's biggest airline, which Freeland said was done to ensure taxpayers benefit once Air Canada's revenue rises when regular travel resumes.
In early 2020, senior executives and 3,200 management employees voluntarily agreed to reductions of $11.5 million in their base salaries, subject to compensation through share appreciation units that might allow employees to recover some of the forgone salary if the share price rises higher in December 2022 than December 2020, said Air Canada.
