Union leaders for Air Canada's pilots and flight attendants say Robert Milton's pay package has left employees in a foul mood, jeopardizing recent improvements in labour relations.
Mr. Milton, chairman and chief executive officer of ACE Aviation Holdings Inc. , saw his compensation more than double to $14.7-million last year. From 2005 through 2009, his remuneration exceeded $82.7-million at ACE.
ACE is a holding company that until recently was the controlling shareholder in Air Canada. It sharply cut its stake in the airline last year, but still owns 27 per cent.
"If you're asking employees to tighten their belts at the same time as these obscene payouts, then that is not leading by example and does not motivate us or make us feel very good," said Captain Paul Strachan, president of the Air Canada Pilots Association.
Mr. Milton's pay packet last year included $7.6-million in severance and other payouts, though he declined to take it in cash, choosing instead to acquire and retain 784,350 ACE shares.
Barrick CEO tops the list with $24.2-million
In 2009, he also received $5-million in "incentive awards" related to the process of winding down ACE, almost $1.3-million for "the credit or early vesting of additional years of pensionable service," $504,167 in salary and $157,500 in "standby consulting fees."
Mr. Milton, who ran Air Canada from 1999 to 2004, could not be reached for comment Wednesday. But his supporters have emphasized that the veteran airline executive unlocked billions of dollars in "hidden value" at Air Canada, partly through the spinoff of assets such as Groupe Aeroplan Inc., the loyalty company. They also point out that he spearheaded ACE's participation in a financial rescue package of the carrier last summer, when the airline appeared to be headed towards a cash crunch.
"I was the head of this company, and billions of dollars were made, and billions of dollars were invested … in the form of aircraft. A lot of things happened because of what we did at ACE, and they stand in stark contrast with what's happened at, really, all other airlines in North America," Mr. Milton said last year in an interview with The Globe and Mail's Report on Business Magazine.
Mr. Strachan said Air Canada's labour climate has been gradually improving, helped by a deal that allowed five unions to hold a total of 17.6 million Air Canada shares, or a 6.3-per-cent stake, effective last October. But he said Mr. Milton's compensation erodes union leaders' efforts to convince employees that they're making a difference with wage sacrifices and productivity concessions.
ACE, created in 2004 after Air Canada emerged from bankruptcy protection, later spun off or sold a number of businesses, including Aeroplan and regional carrier Jazz Air. It sold a 25-per-cent stake in Air Canada during the carrier's initial public offering in 2006.
"The creation of ACE is still a very sensitive topic with the union membership," said Katherine Thompson, president of the Air Canada component of the Canadian Union of Public Employees, which represents flight attendants. "It was our concessions that made the renewal of Air Canada possible in 2004. But the airline was broken into pieces and sold off."
ACE now has 32.5 million shares outstanding, or a stock market value of $253-million.
of pay for performance."
More from Executive Compensation 2009:
Recent rankings on Globeandmail.com: