€1.5m in pay for Aer Lingus chief

Aer Lingus chief executive Christoph Müller saw his 2013 pay packet jump by nearly 18%, helped by nearly €1m in bonus payments and pension contributions.

The news came as unions said the firm had announced it was cutting payments to staff under an agreed gain sharing scheme.

The Impact union also said the airline’s annual report revealed plans to make €30m in savings through job cuts and increased productivity but no formal notice had been given about its plans.

The airline’s latest annual report, published yesterday, shows Mr Müller was paid €1.52m last year, up from just over €1.29m for 2012.

While Mr Müller doesn’t receive any additional fees for being a director of the airline, his basic salary remains subject to annual review.

In this regard, his pay remained unchanged at €475,000. However, Mr Müller’s pension contributions totalled €175,000, with “other benefits” amounting to €51,000. Although his performance-related bonus decreased from €647,000 to €420,000; his overall bonus essentially grew significantly as he was also awarded a special bonus of €400,000.

Last month, Aer Lingus reported a set of annual figures — featuring a 2.3% rise in revenue to almost €1.43bn, a 0.6% increase in total profit for the year to €34.1m but a near 12% drop in operating profit to €61.1m, with long-haul revenues climbing strongly, but short-haul sales falling — which Mr Müller described as the first sign of significant growth since the onset of the downturn.

He was quoted last month saying that he was “broadly satisfied” with the figures, but added the airline “could have done better”.

Outgoing chief financial officer, Andrew MacFarlane, voluntarily took a 23% reduction in basic salary last year to €330,000; with his overall remuneration package falling from €876,000 to €669,000. His annual performance-related bonus came to €177,000, with a pension contribution of €107,000 and ‘other benefits’ at €55,000.

Impact said staff were “dismayed” by Mr Müller’s remuneration package. It said it was insulting to staff who are likely to be facing a “substantial cut in their retirement incomes on top of a decision by the company to slash an agreed staff gain sharing payment by up to 80%”.

Impact national secretary Matt Staunton said the airline announced it is to cut payments under an agreed gain sharing scheme. “The Greenfield rescue agreement included a payment for profitability targets worth an average of less than €1,000 per worker for their contribution to keeping the company in profit. The company has announced it will now pay only €250 under the gain sharing agreement. This is in stark contrast to those bonus payments made to Mr Müller.

Siptu pension policy adviser Dermot O’Loughlin said: “It is ironic that Aer Lingus has chosen to increase its pension contribution to the chief executive from 25% to 40% at a time when it has continually failed to resolve the pension debacle for employees of the company.”