Embattled airplane manufacturer Boeing said it’s overhauling its bonus structure to tie payouts more closely to safety as it scrambles to recover from the crisis caused by the Alaska Air door-plug blowout.
Boeing staffers — including managers and executives — will be awarded bonuses based on whether they meet safety-related performance metrics, according to an internal memo obtained by The Wall Street Journal.
It’s a shift away from incentive plans that were revealed in a securities filing flagged in January by Elon Musk, which showed that for the past two years, Boeing’s executives have been awarded bonuses based increasingly on whether they meet diversity, equity and inclusion goals.
The rest of Boeing’s nonunion workforce of more than 100,000 staffers had been given bonuses based on financial incentives.
The note, which was first circulated among employees, said that the biggest shift will be in the company’s largest department, its commercial unit, which assembles the likes of the 737 Max 9 — the model that was involved in the Alaska Airlines flight where the door blew off at 16,000 feet.
It turned out that key bolts had been missing from the door plug, which had been removed to fix rivets that were damaged in the production process, according to the independent US National Transportation Safety Board report.
Boeing announed this week that 60% of bonuses for its nonunion workers in its commercial unit will be derived from safety and quality metrics — a switch up from the financial incentives that used to determine year-end bonuses. AFP via Getty ImagesIt wasn’t immediately clear if staffers who overlooked the fact that the plane was missing important parts would have their bonuses slashed. However, it appears that moving forward, Boeing will be awarding employees who ensure that the airliners’ doors stay intact.
In the commercial unit, 60% of workers’ annual bonuses will now be derived from safety and quality metrics, according to The Journal.
Criterion that will determine the rewards include employee safety, work done out of sequence on the assembly line and so-called rework required to fix problems, The Journal reported.
Previously, financial incentives comprised the lion’s share, or 75%, of the annual award, while the remaining quarter was tied to operational objectives, including quality and safety.
In Boeing’s two other units — defense and services — financial metrics will still determine three-quarters of staffers’ year-end bonuses.
However, quality and safety will be the only factors to determine the operational scores in these units, per The Journal.
Executives and managers who ovesee all units — including CEO Dave Calhoun — will be awarded bonuses on the average performance of Boeing’s three departments.
Boeing has been overhauling parts of its operations ever since a midair fuselage blowout became a full-blown safety and reputational crisis for the plane manufacturer. APRegulatory filings that circulated social media in the wake of the now-infamous Alaska Airlines flight appeared to show the aeronautical giant has been using DEI and climate goals as incentives for executive compensation since 2022 — rather than employee safety and quality.
Boeing’s move to put safety first was announced in a webcast this week, where opetaing chief Stephanie Pope said: “It’s very, very important to drive the outcomes that we’re all committed to, and that’s to deliver a safe and quality product to our customer,” Boeing told The Post.
The change in bonus structure comes just after Boeing was given 90 days to develop “a comprehensive action plan to address its systemic quality-control issues” as part of the US Federal Aviation Administration’s harsh crackdown on the manufacturer.
The US Federal Aviation Administration has given Boeing 90 days, until May 28, to develop ” comprehensive action plan to address its systemic quality-control issues,” per a statement the government agency released last month. REUTERSSeparately, the US Justice Department has said that it’s investigating the company’s role in a near-disastrous midair door blowout on an Alaska Airlines flight last month where luckily, no one was sitting next to the door that blew off.
The DOJ said that it’s deciding whether the incident falls under the government’s 2021 deferred-prosecution agreement with the company.
If prosecutors determine that the door plug blowout constitutes a breach of that contractual agreement, then Boeing could face criminal liability, Bloomberg reported, citing a person familiar with the matter.
Boeing is also kicking off negotiations with the International Association of Machinists and Aerospace Workers union on Friday, according to The Journal, which represents more than 32,000 Boeing machinists in Washington state, including at its 737 factory in Renton.
On Friday, Boeing is beginning the first full contract negotiation with the International Association of Machinists and Aerospace Workers union in 16 years. AFP via Getty ImagesThe union is seeking 40% wage increases within th next three to four years, the return of a defined-benefit pension and a commitment from Boeing that the next new jet will be produced by its workers, The Journal reported.
The proposed perks are not a direct result of the fuselage blowout, and instead come as the union looks to make up for years of losses in a controversial 2014 contract that agreed to eliminate pensions and accept modest wage increases.
At the time, the IAM said the deal ensured the wide-body 777X would be built in the Puget Sound region in northwestern Washington, according to The Journal.






