United Continental Holdings Inc. canceled Chief Executive Officer Oscar Munoz's expected elevation to chairman next year as the carrier continues to deal with the fallout from a public-relations disaster after a passenger was dragged off a plane.
Future determinations related to the chairmanship will be left to the discretion of the board, the carrier said in a regulatory filing Friday. Munoz had been expected to add the role at next year's annual shareholders meeting.
The change to Munoz's contract came less than two weeks after passenger David Dao was forcibly removed by security officers from a Chicago flight to Louisville, Kentucky. Dao suffered a concussion, broken nose and two lost teeth after he refused to give up his seat for a United crew member, his lawyer said.
Munoz, who had been expected to add the role at next year's annual shareholders meeting, initiated the change, according to the filing. He already agreed last year to delay taking on the chairman's position after the board was revamped as part of a deal with two activist shareholders. The company named Robert Milton as chairman, and three incumbent directors decided not to stand for re-election.
$18.7 Million Pay
Munoz earned $18.7 million in compensation last year as he collected a multimillion-dollar signing award, according to a separate filing by the Chicago-based carrier. The company granted him stock valued at $6.8 million to entice him to join the company in September 2015. The payout came well before the April 9 incident with Dao, which sparked global outrage.
Munoz said earlier this week that Dao's treatment was a "humbling learning experience" for United and accepted full responsibility.
The CEO's initial reaction drew scorn worldwide last week when he called the incident "upsetting" and apologized for having to "re-accommodate" the passengers who were asked to leave the plane. Hours later he told employees that Dao had been "disruptive and belligerent," based on early reports.
He finally went on ABC's "Good Morning America" with a more contrite message and promised a full review of United's policies regarding oversold flights.
Michael Sasso and Anders Melin, Bloomberg
