In September 2023, the head of Australia's flagship carrier Qantas Airways (QUBSF) ended a 15-year career with an undignified resignation amid a growing scandal around the airline selling seats for flights it never intended to run during the covid-19 lockdowns.
As part of his exit package, former CEO Alan Joyce was offered a compensation package of $23.6 million Australian dollars ($15.5 million USD) — A$14.4 million ($9.46 million USD) of which was connected to long-term bonuses and payouts proportional to corporate outcomes that was at risk of being taken back by the board upon review.
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In the months that followed Joyce's resignation, Qantas lost a lawsuit in the country's High Court over the firing of 1,700 airline workers during the pandemic and faced multiple fines related to its handling of ticket sales during that period.
'Caused considerable harm to relationships with customers, employees and other stakeholders'
On Aug. 8, the airline announced that A$9.26 million ($6.09 million USD) of Joyce's bonus will be taken back due to leadership during "events that damaged Qantas and its reputation and caused considerable harm to relationships with customers, employees and other stakeholders."
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"While there were no findings of deliberate wrongdoing, the review found that mistakes were made by the Board and management which contributed to the Group’s significant reputational and customer service issues," Qantas said in a media statement.
The clawed-back portion of Joyce's buyout includes A$8.36 million ($5.5 million USD) of Qantas stock based on current share price and a cut of approximately A$900,000 ($592,000 USD) to his short-term incentive bonus. The latter cut is part of a wider decision to cut short-term bonuses for current and past executives by 33%.
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'Overall accountability and responsibility for the outcomes of the business'
"Mr. Joyce was the chief executive officer of the Qantas Group," the airline said in a further statement. "In this role he had overall accountability and responsibility for the outcomes of the business and this is reflected in the forfeiting of his 2021-2023 LTIP [Long Term Incentive Plan] shares that vested in August 2023. Current non-executive directors who were on the board at the time will take a 33% reduction to their directors’ base fees this year."
The decision was announced after the board concluded its review of finances for the 2021 to 2023 period. Qantas' full-year earnings will be released to the public on August 29.
Since the multiple scandals around the airline started gaining steam in the fall of 2023, Qantas has been on a mission to repair its reputation in whatever way possible. Former Chief Financial Officer Vanessa Hudson, who took over the airline's leadership after Joyce's resignation, ended up releasing an apology video in which she admits that the airline has "let you down in many ways."
Frequent Qantas customers were a lot less forgiving — every post Qantas has put out in the last nine months was met with jibes over the ongoing issues.
"Please don't forget that loyalty isn't limited to corporate accounts with deep pockets," reads one of the most upvoted comments under the apology video. "Real loyalty is found in the people who choose to spend their own money to fly Qantas."
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