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Home BUSINESSFinnair board approves incentive plan for pilots
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Tue, 14 Oct, 2014 12:43:34 AM
Ftimes Report, Oct. 14
 
File Photo Lehtikuva.
The board of directors of Finnair has approved a long-term incentive plan for its pilots, said the national flag carrier in a release.
 
Finnair said the planned period is 2015-2018 and the prerequisite for rewarding the pilots is materialisation of the agreed cost-saving measures over the time period. The airline said the share price of the company must at least be 4 euros at the end of 2018. The pilots will be entitled to cash payment, if these conditions are met, said the airline.
 
The total reward to pilots would amount to 12 million euros, if the share price is 4 euros, or a maximum of 24 million euros, if the share price reaches at least 8 euros. Divided over the four-year period, the annual earnings potential for an individual pilot is equivalent to 5-10 per cent of annual base salary.
 
According to Finnair, the number of pilots eligible to participate in the plan is approximately 700. The cash reward will be paid to pilots in spring 2019, provided that the aforementioned performance criteria are met, said the release.
 
“With this incentive plan, the savings agreement negotiated with pilots enters into force, which is essential to improve Finnair’s competitiveness. If the plan’s performance criteria are met, Finnair shareholders will have enjoyed a significant increase in the company’s valuation and the pilots will receive a one-time compensation for the permanent savings they have agreed on,” observed Finnair CEO Pekka Vauramo.
 
The plan is a part of the savings agreement inked between Finnair and the Finnish Air Line Pilots’ Association (SLL) that brings Finnair 17 million euros in permanent annual savings.
 
 
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