American Airlines Group is promising employees up to $150 a month in bonus pay if workers can outperform its three biggest rivals.
The newly formed entity consists of former rivals American Airlines and US Airways, which completed their merger about a month ago. Combined, the new American has more than 100,000 employees around the world and has almost 6,700 flights every day.
The program, dubbed “Ops Olympics,” has a three-tiered structure: To earn the maximum $150 award, the airline has to beat Delta Air Lines, Southwest Airlines and United Airline on three Department of Transportation metrics: on-time arrivals, baggage handling and customer satisfaction, measured by complaints passengers make to the DOT.
If they beat the other carriers on two out of the three criteria, employees earn $100. Scoring tops in one area, or having a 70 percent on-time departure rate for the month, nets workers $50 apiece. (The DOT’s definition of “on time” for ranking purposes is within 14 minutes of the published time.)
“One way we’ll restore American is by being an industry leader,” Chief Operating Officer Robert Isom wrote in an email to employees Thursday. “We will all know and be held accountable for these measures … they must be critical to each of us.”
Isom said all employees, not just those working in operations, were eligible, although the airline’s regional carriers aren’t part of the new push. The program replaces a similar one US Airways ran prior to the merger.
Experts in incentives and employee recognition say American’s program shows promise.
“American Airlines is doing a number of things right,” Melissa Van Dyke, president of the Incentive Research Foundation, said via email. “They have identified the unrealized work goal, are specific in the metrics, are showing strong organizational/leadership support, and are presumably building on a positive previous program.”
Roy Saunderson, chief learning officer at consulting company Recognition Management Institute, said reward programs that have everyone working toward a common goal are an especially good way to bond employees and forge a single corporate culture after a merger. “It’s a beneficial tool in that scenario,” he said.
But Van Dyke added that the program’s $150 top reward was “a little low” and that the Federation’s research showed the optimal award for this type of program more in the $250 range. “Maxing out at $150 could be a low motivator,” she said.
Saunderson cautioned that making the rewards part of compensation, which Isom said the company would be doing, could reduce its motivational punch. “One of the problems is sometimes rewards become so transactional,” he said. “If it’s not given in a meaningful way and is strictly on the paycheck, that’s a negative.”
Ideally, Saunderson said, monetary rewards should be meted out in conjunction with recognition — employee of the month, a letter from the CEO or some other form of acknowledgment of work well done. An American spokesman said via email that there are recognition programs in place.
“I think the key here is that they should not lose focus on individual exceptional performance, which does not have to be rewarded, but always has to be recognized,” Saunderson said.