KLM is refraining from the intended increase in the variable salary of CEO Pieter Elbers. The agenda at the upcoming shareholders ‘meeting was that this long-term remuneration would increase from 75 percent to a maximum of 100 percent of Elbers’ base salary of 525,000. However, due to the turmoil caused by the proposal, the item has now been dropped from the agenda, KLM reported.
The supervisory board now took the decision in consultation with Elbers. The latter regrets the commotion that has arisen and calls it unfortunate.
“All my and my KLM colleagues’ focus is on the continuity of the company and the retention of KLM for the Netherlands. That should be about it and not about rewards,” said the KLM boss.
According to KLM president-commissioner Cees’ t Hart, a false picture has been given, also with regard to the support measures that are being granted to KLM to keep the company afloat.
“It would have been better not to put this topic on the agenda and it is now off the table.” KLM’s works council also supports the decision.
KLM is in talks with the Dutch and French governments about a support package to guide Air France-KLM through the corona crisis. Reportedly, Finance Minister Wopke Hoekstra and his French colleague Bruno Le Maire are willing to partially guarantee billions of loans so that fixed costs can be paid, even now that almost the entire fleet is grounded. The House of Representatives wants hard conditions to be attached to this support. Hoekstra previously called the increase “unwise”, having already indicated that he would discuss the proposal with KLM.
KLM previously said that putting the wage increase on the agenda is the culmination of a process that started more than a year ago. So amply before the corona crisis, KLM and the entire sector paralyzed. This is about equalizing rewards within Air France-KLM. In the eyes of KLM, the agenda item was a hammer piece, also because it concerns long-term rewards that do not affect payments this year anyway.
The chance that Elbers would actually get a higher bonus this year was already zero. The payment of profit sharing and bonuses has been postponed at KLM due to the corona crisis until further notice. Salary increases are also not on the agenda for the time being. Furthermore, KLM does not pay a dividend.
Leah Kunze just graduated MBA and is proud of it. She is interested in automotive industry and innovations. She well be glad to receive a mail to leah.kunze@economicinform.com
