THE FORMER CHIEF EXECUTIVE of Aer Lingus is to be rewarded with a 12% pay increase as soon as he finalises the merger of British Airways with Spanish carrier Iberia.
Willie Walsh, who left Aer Lingus to take up the job as BA’s CEO, is to see his annual pay increase from £735,000 (€840,000) to £825,000 (€943,200) when the merger is completed, according to documents released yesterday.
Walsh’s pension contributions will also increase, from 12% of his salary to 25%, while the maximum bonus he can be paid will increase from 100% of his basic salary to 200% – meaning he could now receive €1.88m a year in bonuses alone.
As if that wasn’t enough, the Irish Independent reports that Walsh will also be in line for a ‘performance share award’, which will give him an extra bonus if the airline’s shares outperform those of rival airlines on the world’s stock exchanges.
Walsh’s pay as head of CEO had been frozen for the last two years, while the Irishman – a former Aer Lingus pilot before he became involved in the Irish flag-carrier’s operation – had also given up £334,000 (€381,000) in bonuses for 2009.
He had also agreed to forego his salary for the month of July 2009 as he was implementing a cost-cutting programme across the airline at that time.
The documents released yesterday also showed massive pay increases in the pipeline for other senior executives at the troubled British Airline.
The release, as the Guardian points out, comes at a sensitive time, however, with BA cabin crew set to hold ballots which would see them accept a new pay deal and end months of industrial dispute which has included several rounds of strike action.
BA and Iberia signed their merger deal on April 8, with the European Commission approving the action in July. The newly-created group, International Consolidated Airlines Group, will become Europe’s second-most-valuable airline after Lufthansa when the merger is finalised in January. Shareholders will vote to give their final approval to the deal on November 29.