Southwest Airlines Co. (NYSE: LUV) will share USD 586m through its ProfitSharing plan with its employees for 2016, equaling approximately 13.2% of each eligible employee´s eligible compensation, or the equivalent of six weeks´ pay, the company said.
This is Southwest Airlines´ 43rd consecutive ProfitSharing award. For the 2016 plan year, Southwest announced a new funding structure that will pay part of the ProfitSharing award to the retirement plan and part in cash.
Most employees will receive 10% of eligible compensation as a contribution to the ProfitSharing plan and the remaining approximately 3.2%, in cash, both of which will be paid on April 20, 2017. Some employees will receive the entire ProfitSharing award in the retirement plan as specified in their collective bargaining agreement.
This USD 586m award is equivalent to more than USD 1.6m per day. When added to the company´s USD 351m in contributions to Southwest´s 401(k) plans for 2016, the airline will have rewarded employees with approximately USD 937m, USD 852m of retirement benefits plus a cash payment of USD 85m.
Southwest Airlines also invested approximately USD 746m in its employees´ other benefits during 2016, including healthcare coverage, and other welfare and wellness programs. In total, the amount dedicated to the wealth and wellbeing of Southwest employees for 2016 is USD 1.7b, on top of base salaries.
Through the ProfitSharing plan, Southwest Employees currently own more than 4% of the company´s outstanding shares.
Dallas-based Southwest Airlines (NYSE: LUV) operates a network of 101 destinations in the United States and eight additional countries with more than 3,900 departures a day during peak travel season. Its 53,000 employees serve more than 100 million customers annually.