Bombardier pay hikes spark protests, Trudeau ire

Mon Apr 3, 2017 6:14pm EDT
 
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By Allison Lampert and Leah Schnurr

MONTREAL/OTTAWA (Reuters) - Canadian plane and train maker Bombardier Inc tried to contain a public relations debacle on Monday after protests and a dressing down by Prime Minister Justin Trudeau over hefty executive pay hikes just weeks after its latest government loan.

Bombardier, which has received more than $1 billion in federal and provincial government aid since 2015, awarded its top five executives and board chairman raises of up to 50 percent for 2016.

The pay hikes, disclosed in public filings last week, sparked protests outside Bombardier's Montreal headquarters on Sunday and calls by opposition leaders for a company freeze on executive compensation.

Bombardier retreated on Sunday, saying that more than 50 percent of the total planned compensation will be deferred until 2020 and will be payable only if the company achieves performance goals. Executive Chairman Pierre Beaudoin also renounced his raise on Friday.

"We didn't do a good job of communicating it," Chief Executive Alain Bellemare told a Quebec radio show on Monday. "If you look at it at face value, I can understand why people were so angry, so unhappy."

The compensation packages for the executives and the board chairman included salary, bonuses and stock options. The company was able to defer part of the raises because the remuneration tied to options is forward dating, a spokesman said on Monday.

Bellemare said the pay was needed to retain top talent.

But Quebec and Canadian government officials said they were not surprised by the public anger against Bombardier, which announced plans in 2016 to lay off more than 14,000 people in the province and globally over two years.   Continued...

 
Canadian Prime Minister Justin Trudeau speaks to the press following a robotics demonstration at Kinova Robotics in Boisbriand, Quebec, Canada March 24, 2017.  REUTERS/Christinne Muschi