Customers making their way through airports Tuesday may notice the normally warm and caring Delta people have a little extra bounce in their step. That’s because the airline is celebrating Employee Appreciation Day – a day that comes with a big show of gratitude: more than a half-million dollars in profit sharing.
Delta’s Employee Appreciation Day is no ordinary office party with cupcakes, pizza and balloons. Every employee woke up Tuesday morning with a fresh deposit in their bank account – their share of the company’s $563 million profit sharing payout. That comes out to about 5.57% of each employee’s eligible 2022 earnings. (Don’t worry. There’s pizza and cupcakes, too.)
"Delta people rose to the challenges of 2022, delivering industry-leading operational reliability and financial performance, and I'm looking forward to recognizing their achievements," Delta CEO Ed Bastian said in the company's earnings report on Jan. 13. He along with other company executives will be meeting with employees throughout the operation across the U.S. and around the world Tuesday to commemorate the company’s celebration.
The annual profit sharing is just the latest good news for employees. Last week, Delta announced that eligible employees have earned a 5% pay increase effective April 1, 2023 as the company continues to invest in the people who lead the industry in operational and customer care excellence. This latest pay increase provides employees with a total 9% pay increase within the last year (4% in May 2022 and 5% in April 2023).
“Delta people are the best in the business, and thanks to your efforts, we’re well-positioned to take back the skies, and soar into the future together,” said Bastian.
Since 2007, Delta has rewarded employees with industry-leading profit-sharing payments: more than $9.2 billion since 2010 (including nearly $6 billion in the five years leading up to the pandemic). Delta's 2019 employee profit-sharing payout was $1.6 billion, equaling 16.71% of our employees' earnings – or nearly two months of additional pay for each employee.
The profit-sharing payouts can have a massive, cascading impact for employees and the communities where Delta operates. Some of that money will be spent locally, allowing small businesses to expand; that expansion enables a second round of spending, which then further fuels local business growth that can then boost a third round of spending.
Delta funds the annual profit-sharing pool with 10% of the first $2.5 billion of profits and 20% of profits in excess of $2.5 billion. The pool amount is then divided by the total earnings of all eligible employees. The result is the percentage of earnings Delta will pay out in profit sharing to each eligible employee.
While employees can opt to receive the profit-sharing payment in cash, they also have the option to use a portion of their profit-sharing payment to fund their 401(k). Delta matches 100% up to 6% of any profit sharing that an employee contributes and contributes an automatic 3% of profit sharing to their 401(k) account. Employees also have the option this year to contribute to the Spirit of Delta Campaign benefiting the Delta Care and Scholarship Fund.
Delta people earned a total of $61 million in our Shared Rewards program, tied to achieving internal operational goals. Delta kept that program intact throughout the pandemic while other airlines suspended theirs, allowing us to grant our employees an extra $1,575 between April 2020 and December 2021.
In 2021, we did not have a full-year profit but did report a profit for the year's second half. Consistent with our philosophy of sharing our success, Delta issued a special profit-sharing payment of approximately $100 million. Each employee received a flat amount of $1,250 (if hired before Jul. 1, 2021) or $625 (if hired on or after Jul. 1, 2021).