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Bombardier delays most executive pay hikes amid rise in public anger

People hold up signs during a demonstration outside Bombardier's head office in Montreal, Sunday, April 2, 2017, to protest recent pay hikes and bonuses to the company's top executives.

Graham Hughes/THE CANADIAN PRESS

Bombardier Inc. is postponing most of its planned pay hikes to six top executives in the face of widespread public outrage and growing pressure from across the political spectrum in Quebec.

The about-face came in the wake of renewed signs of public anger over the hefty hikes. About 200 protesters descended outside Bombardier's headquarters in downtown Montreal on Sunday to criticize the increases, which were characterized as "inappropriate" and "indecent" in light of taxpayer aid and company layoffs.

The Canadian plane and train maker had awarded five top executives and executive chairman Pierre Beaudoin $32.6-million (U.S.) last year, a nearly 50-per-cent increase from the year before.

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Read more: Compensation to Bombardier senior executives rose nearly 50 per cent last year

Read more: Bombardier's compensation committee chair: Pay hikes for senior executives are justified

The compensation came during a year in which the company laid off thousands of workers, finalized an investment deal from Quebec and obtained a $372.5-million (Canadian) pledge in assistance from Ottawa.

But in a statement released late Sunday, Alain Bellemare, Bombardier's chief executive officer, said he has asked the company board to defer payment of more than half the compensation until 2020.

"This action further demonstrates the long-term commitment of the senior executive team to the successful transformation of Bombardier," Mr. Bellemare said.

Premier Philippe Couillard, whose government had been urging the company to reconsider the hikes, voiced satisfaction over the announcement.

"Important for the workers and population of Quebec," the Premier tweeted Sunday night.

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The company's pay raises had placed the Quebec Liberal government, which put $1-billion (U.S.) into Bombardier's C Series jetliner program, on the defensive. The opposition Parti Québécois said it planned to table a motion in the National Assembly on Tuesday asking Bombardier to forfeit the 2016 pay raises.

Government House Leader Jean-Marc Fournier turned up at the Sunday protest, joining a chorus of politicians from his own government, as well as all the opposition parties in the Quebec legislature, in publicly criticizing the move.

Mr. Fournier said Quebeckers have pride in Bombardier and its successes around the world. "We don't want there to be a breakdown in their confidence," he told Radio-Canada.

"If I am here today it's to express in the name of the government that we hear Quebeckers' voices, and we hope that Bombardier hears those voices [too], and reviews its decision," Mr. Fournier said.

Some citizens who turned out Sunday said they viewed the pay hikes as a "betrayal" after helping the company, which is considered a flagship of Quebec industry.

Michel Milette, a Bombardier employee for 17 years, says his pay has risen only 0.3 per cent over the past three years, and like other staffers, he has made concessions in his benefits.

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"We've been tightening our belts to help Bombardier. We did our share," Mr. Milette said. "We ask that our executives lead by example, and do the same."

Brian Leclerc, a union official who works for a telecommunications company in suburban Montreal, said he considers the pay hikes "socially unacceptable" after government austerity left cuts in daycares and schools.

"As a citizen, a taxpayer and a worker, it's an outrage," he said.

Mr. Beaudoin, who received $5.25-million, up from $3.85-million the year before, offered to forego his pay increase for 2016.

A Léger poll for TVA-Le Journal de Montréal over the weekend suggested that public confidence in the company is falling, while an overwhelming 93 per cent of respondents oppose the pay hikes.

Video: Trudeau defends Bombardier loan after executive pay hike (The Canadian Press)
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About the Author

Ingrid Peritz has been a Montreal-based correspondent for The Globe and Mail since 1998. Her reporting on the plight of Canadians suffering from the damaging effects of the drug thalidomide helped victims obtain federal compensation and earned The Globe and Mail a National Newspaper Award, Canadian Journalism Foundation award, and the Michener Award for public service. More

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