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Profit Sharing Update

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Source: AFA

Date: Jan 29, 2016

Source: Elines

Our Profit Sharing Program (Section 5.J. of our Contract) pays out when the adjusted pretax earnings at United Airlines exceeds $10 million dollars. Fifteen (15%) percent of United's pretax earnings forms the Annual Profit Sharing pool that is distributed pro-rata to all eligible Flight Attendants based on the ratio of the Flight Attendant’s Considered Earnings for the year to the aggregate amount of Considered Earnings for all eligible employees for that year. United’s Profit Sharing pool for all eligible employees $698 million  -  almost three times greater than the 2014 Profit Sharing pool of $ 235 million.

The 2015 Profit Sharing payments are scheduled to be included in the March 1, 2016 paycheck for all eligible employees.  It is important to take note that this year’s Profit Sharing payment will not be issued as a separate check.  Rather, the payment will be included in our March 1st paycheck which includes the advance on our February flying.  This is different from previous years.

Flight Attendants who do not make a special election to defer some or all of the Profit Sharing into their 401(k) account (either pre-tax or their Roth 401(k)) or who do not qualify** to make a special election, will receive their Profit Sharing in cash paid in the same manner in which the monthly paycheck is received – either direct deposit or as a paper check. 

The Profit Sharing special election window is now open through Monday, February 8, 2016 at midnight Central Time.  

Flight Attendants have the option to allocate their 2015 Profit Sharing into their 401(k) account by indicating the percentage of the Profit Sharing payment to be directed: 

  • On a before tax basis to the company sponsored 401(k) plan, and/or
  • On an after tax basis to a Roth 401(k) plan account, and/or
  • Any unallocated percentage will be paid to the Flight Attendant in cash, subject to applicable taxation and withholding.

**Flight Attendants on Leaves of Absence, including those on Special Leaves of Absence and Retirees are not eligible to defer any portion of Profit Sharing into their pre-tax or Roth 401(k) accounts under the terms of the Profit Sharing Plan.

Keep in mind, Profit Sharing contributed to a pre-tax 401(k) account is exempt from Federal taxes but is subject to certain State, Local, and F.I.C.A. withholding. Whereas contributions to a Roth 401(k) are made after taxes and are subject to Federal, State, Local and F.I.C.A. withholding.

We encourage everyone to review the company’s publication and Q&A to ensure you are aware of the implications now that the payment is part of your regular paycheck. If you have additional questions we strongly recommend you contact your professional tax advisor prior to making any election.  

For any general questions about Profit Sharing, eligible earnings, statement printing assistance, or Profit Sharing calculation, please contact United’s Employee Service Center (ESC) at 877-825-3729 and select the prompt for HR Operations

Speaking of Profit Sharing…..
Over the past several weeks we’ve received a number of questions from Flight Attendants asking about how the participation of other work groups in the Profit Sharing Program impacts the share of the profits to which any other group, specifically  pre-merger United Flight Attendants, are entitled based on the language in our Contract and the Profit Sharing Plan documents.  The fact is that the participation of any one work groups does not impact the percentage of the Profit Sharing Pool that is allocated to any other work group.  Each work group stands alone in the determination of the amount of money distributed to that work group and this is based on the ratio of the wages of that given work group to the wages of all employees during the year in which the corporation reports more than $10 million in Pre-tax Earnings. 

Once that amount is determined, each employee receives their individual share of the group’s Profit Sharing based on the unique wages of each employee based on the ratio of that employee’s wages to the total wages for their work group. 

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