Aer Lingus staff furious over Mueller's €500,000 bonus
Aer Lingus chief executive Christoph Mueller received almost a €500,000 bonus in 2010 -- more than his basic salary, as the airline posted a €33.4m pre-tax profit for the year, according to the company's annual report published yesterday.
But there was an angry response from airline staff over the "exhorbitant" payments.
The €483,000 bonus payment, coupled with his €475,000 basic pay, a €119,000 pension contribution and further extras including a health plan and relocation expenses of €55,000, brought his total remuneration for the year to €1.13m.
That's more than the total of €1.1m that was paid to former Aer Lingus chief executive Dermot Mannion in 2007, when the airline recorded a €105m profit.
That year, Mr Mannion received a basic package of €433,000 and a performance-related bonus of €335,000. He also received a €312,000 pension contribution that year and €35,000 in other benefits.
Mr Mueller replaced Mr Mannion as chief executive in September 2009. Mr Mueller was paid as much last year as British Airways chief executive Willie Walsh in that airline's financial year ended March 2010.
That year, Mr Walsh received a basic salary of £674,000 (€748,000), but no cash bonus.
He was awarded deferred shares worth £334,000 and other expenses of £16,000 which brought his package to £1.024m (€1.13m).
BA, which recently merged with Iberia, made a £531m (€589m) loss that year, however.
Michael O'Leary, the boss of Ryanair, which owns almost 30pc of Aer Lingus, was paid a total of €900,000 in the airline's financial year to the end of March 2010, including a €595,000 basic salary and a €241,000 bonus. Ryanair made a €341m pre-tax profit that year.
When Mr Mueller joined Aer Lingus in 2009 he also engineered a stock option structure that includes 500,000 shares with a strike price of 58 cent.
Aer Lingus shares were trading yesterday at around 73 cent, having touched €1.17 back in November. A sum of €192,531 was charged to the Aer Lingus income statement last year in relation to those options granted to Mr Mueller.
The chief executive also has a further 1.5m options that will vest on dates between September 2012 and September 2014 at prices of between 57.3 cent and 88.6 cent a share.
Compared to chief executives of other Irish mid-cap companies, Mr Mueller's remuneration for 2010 compares well.
Gene Murtagh, the chief executive of Cavan-based insulation maker Kingspan received a total package worth €756,000 in 2009, the latest year for which the company's annual report is available.
That included a basic salary of €635,000, but Mr Murtagh received no bonus for the second year running, despite the company having posted a €56.7m pre-tax profit.
SIPTU, which represents over 1,500 Aer Lingus staff, said they were angry at the "exorbitant" payments to Mr Mueller t made "on the back of their labour".
National organiser Jason Palmer said he had received almost a dozen phone calls from staff complaining about Mr Mueller's bonus yesterday.
"Staff are not happy," he said. "They've taken a pay cut to facilitate change, while people at the top are now getting a bonus for implementing it."
He said his members would be making their feelings known to Mr Mueller when he attended the next meeting of the union group, the central representative council, in a few weeks.
"We'll make our displeasure known at that. Workers have taken the pain to swing the company's fortunes and people at the top end of the scale are being rewarded for that."
He said the company may argue that staff would benefit from a gain-sharing scheme, but the amount they would get would be nowhere near Mr Mueller's pay. "They are happy to see the company's fortunes turn, but not to see this exorbitant amount of money paid on the back of their labour."