Last Update: at 1:26

Bad Timing

Management of Austrian Airlines criticized for accepting bonus

Shortly before the state aid was granted, the Management Board of Austrian Airlines was paid out its bonus for 2019. This provoked fierce criticism.

On Monday Alexis von Hoensbroech expressed his joy. The CEO of Austrian Airlines said he was very grateful «that we are being helped in this historically unprecedented crisis and pandemic». Earlier, the German Economic Stabilization Fund had approved the government aid packages for all Lufthansa subsidiaries.

This paved the way for the payment of 150 million euros in fresh equity from the Austrian treasury. The Austrian government in Vienna is also helping the national airline with a guarantee for 90 percent of a bank loan of 300 million. The parent company Lufthansa is injecting a further 150 million. The initial funds are to be injected at the end of August.

Disbursement postponed during the crisis

But von Hoensbroech’s joy did not last long. On Wednesday (19 August), it was announced that the Board of Management and around 200 other executives had been paid bonuses by Austrian Airlines. The total amount in question is 2.9 million euros. Of that amount, the top management will receive 500,000 euros.

Normally, AUA managers receive their bonuses in spring of each year. However, due to the Corona crisis and the tense financial situation, the payout was postponed until July. The deadline was thus earlier than the date on which the state money is paid out. Admittedly, the aid, of which EUR 150 million is non-repayable, had been negotiated for a long time at that time.

«Missing all sensitivity»

In addition, the employees of Austrian Airlines had already agreed to a deal at the time by which they would forego EUR 80 million annually. At the same time, millions in repayments to passengers for cancelled flights were still outstanding at that time. The criticism of the management’s behaviour was not long in coming.

A spokesman for the FPÖ party immediately described Austrian Airlines as a «self-service shop of the republic», because managers received bonuses despite short-time work and state aid. And Austrian Finance Minister Gernot Blümel said: «This approach is incomprehensible to me». The procedure «lacks any sensitivity».

Management Board reacts

The criticism was effective. On Wednesday (19 August), von Hoensbroech declared that it had been «decided to voluntarily put aside the bonuses paid out for 2019». This was in addition to the already fixed waiver of two thirds of the income for the coming years.

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