Raised eyebrows over TAP CEO salary hike
In what is an unwise and ill-advised move at cash-strapped Portuguese airline TAP, at a time when hundreds of cabin crew are losing their jobs, scores of pilots face redundancy and remaining staff are taking a 25% salary cut, the new TAP CEO, Ramiro Sequeira has seen his salary double.
He is one of three members of the board whose salaries have been reviewed upwards in recent months as the airline struggles to survive under a mountain of accumulated debt amounting to around €3Bn.
Yet despite giving the green light for a major restructuring programme, which will see routes cut, the fleet slimmed down by 80 aircraft, the government has sanctioned the pay rises.
The salary of Ramiro Sequeira is now €35,000 gross per month, an amount which is almost double what the CEO had been earning in his former post as chief operating officer (COO), but is below that of the salary of his predecessor, Antonoaldo Neves.
At no time has it been reported that the interim CEO offered to take a cut in solidarity of the hundreds of staff that will lose their jobs.
The uptick in salary was decided in October by the TAP Salaries Commission on which the State is not represented and will come into immediate effect.
Ramiro Sequeira received €17,000 gross per month and of this €12,000 has to do with fixed income to which €70,000 per year is added in complementary salaries (which divided by 14 give the remaining €5,000 per month.
It means that the CEO’s the gross annual pay rises from €238,000 to €490,000. The information is contained in documents which refer to the increases and which the news source ECO online has access to.
The board president, Miguel Frasquilho also saw his fat cat salary upped to €13.5,000 per month from a more modest €12,000 per month.
In this case, the review is related to taking on new functions at Portugália and at TAP SGPS due to the exit of executive board member, businessman and shareholder Humberto Pedrosa.
However, the minister for infrastructure Pedro Nuno Santos justified the salary increases of the two top managers and later confirmed that Miguel Frasquilho had declined to take his salary increase.
“TAP did not suffer any increase in costs from salaries from the functions undertaken by the three administrators, quite the contrary,” he said, also referring to Alexandra Vieira Reis, TAP’s new head of procurement who now earns €25,000 per month.
Quizzed by ECO, TAP stated “Comparing March with December, the financial expenditure of the Board in its current configuration was slashed by 33% in gross terms”.
The minister admitted that redundancies were similar to those made by the German carrier Lufthansa, affecting around 20% of the workers, with salary cuts of around 45% for pilots and 25% for all others. TAP pilots earn double that of their counterparts at Iberia with €84,000 gross per annum.