Many at Delta to get lump-sum payment

ATLANTA — Delta Air Lines Inc. plans to issue a lump-sum cash payment to many employees when the airline emerges from bankruptcy this spring, according to a newsletter sent this week to workers from Chief Executive Gerald Grinstein.

The exact amount of money was not disclosed, but the newsletter said all regular employees, not including officers and directors, will receive a lump-sum payment representing a percentage of their pay.

A majority of employees also will receive grants of unrestricted stock in the reorganized Delta.

About 1,000 leaders of the company will be granted ownership stakes in Delta, but those shares will come in different forms, such as restricted stock, stock options and performance stock, and will vest over periods of up to three years, the newsletter said. In addition, some pieces of the management awards will require Delta to meet specific performance goals for them to have any value.

Profit-sharing and other reward programs also will be set up, the newsletter said, adding that profit-sharing will pay at least 15 percent of the company's annual pretax profit, which is what's left after subtracting expenses from net revenue.

Grinstein said the company would move to an industry standard pay structure, on par with other carriers, and he said some employees would receive their first pay increases this summer.

Atlanta-based Delta, which operates a hub at Salt Lake City International Airport, has said before that employees would share in Delta's successful emergence from bankruptcy but previously had not released details. The newsletter said employees would receive further details later.

The news follows several years of heavy pay and benefit cuts for all employees, including executives and pilots. Since 2001, Delta also has announced it would cut more than 30,000 jobs.

"Delta's transformation is a remarkable success story from a bankrupt company nearly out of cash to a company that some speculate will once again be the industry leader — and that is certainly our goal," Grinstein said in the newsletter.

Delta, the nation's third-largest carrier, filed for bankruptcy in September 2005. It projects it will be worth $9.4 billion to $12 billion when it emerges from Chapter 11, possibly as early as next month.