Southwest Airlines CEO Robert Jordan's compensation nearly doubled last year to $5.3 million after being promoted to the top job during a year that ended with massive flight cancellations that will cost Southwest more than $1 billion.
Southwest disclosed in a proxy filed Thursday that the estimated value of Jordan's compensation rose from $3 million in 2021 when he was executive vice president of the Dallas-based airline.
In 2022, Jordan received stock awards valued at $3.6 million, $676,875 in salary, a cash bonus and incentive compensation together worth $978,600, plus retirement-plan benefits. The eventual value of the stock awards will depend on the company's financial performance from 2022 through 2024.
A winter storm just before Christmas caused chaos across the airline industry, but Southwest took longer to recover than any of its rivals, as a crew-scheduling system was unable to keep up. The airline wound up canceling 16,700 flights in late December. The airline said the breakdown cost it about $800 million in lost revenue in the fourth quarter and up to $350 million more early this year.
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The Southwest board said in the proxy that it made no adjustment to incentives for executives because of the December cancellations, which it said reduced customer satisfaction scores and the airline's bottom line. Still, the board pointed out, the company posted record revenue of $23.8 billion and remained the only U.S. airline with investment-grade credit ratings from the three leading ratings agencies.
Southwest earned $539 million last year despite a $220 million loss for the fourth quarter.
Jordan has apologized several times for the holiday meltdown, and the airline has announced steps to avoid a repeat, including adding more deicing equipment and staff at key airports and improving its crew-scheduling technology.
