Finnair deploys staff incentive plan, trims winter capacity

Two days after reporting a 91% drop in traffic in September year-on-year, Finnair (AY, Helsinki Vantaa) announced another raft of cost-adjusting measures on October 9, this time aimed at personnel costs. Its new “comprehensive adjustment and cost-savings programme” includes, among other things, “jointly agreed decreases in personnel costs for several personnel groups,” it said without elaborating. Meanwhile, a new three-year incentive plan for the executive board has been cut to equate with that of a broader personnel incentive scheme, whose incentives are paid only if Finnair achieves common targets from 2020 to 2022. “Finnair has launched an incentive programme for personnel and management, aiming at in due course rewarding the Finnair team for their contributions to Finnair’s future. The targets and key performance indicators we have set for the programme are ambitious and in line with the company’s best interests. They are also aligned with the interests of the company’s shareholders,” explained Jouko Karvinen, chairman of the board. The idea is to pay an incentive to participating groups if Finnair succeeds in rebuilding its business over the coming three years in line with performance indicators and targets. At maximum, the incentive payout can amount to around two months’ salary, payable in the third quarter of 2023. The majority state-owned airline revealed on October 7 that it carried just 115,500 passengers during September, representing a drop of 40% from August 2020 and 91% lower than September 2019. There were 61,400 passengers on its Europe routes, down 92.7%; 6,400 on its once-coveted Asia routes, down 96.9%; 47,700 on its domestic routes, down 74.5%; and there were no scheduled flights at all across the North Atlantic.