
United Airlines Replaces Bonuses with a Lottery - jacobkg
https://www.inc.com/bill-murphy-jr/17-united-airlines-employee-replies-to-uniteds-new-bonus-lottery.html
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iamleppert
This was done to try and boost morale and make United a more caring airline?
It looks like an attendance and compliance program in disguise.

How could people at the top be so inept at such basic principles of human
psychology? The only explanation is that Oscar Munoz is a complete sociopath
and cares nothing about his employees, or company for that matter. Makes
absolutely no sense at any level and will only lead to long term damage to the
company.

The net effect is that those people who actually tried harder in their job
because of the bonus will feel no such desire after the first few times they
don’t “win”. Those that do win will know it was pure luck and nothing in their
actions or performance contributed to the winning, so it won’t change their
performance either.

~~~
sk5t
Moreover, it is a very dim-witted program. sub-2% chance of a reward? Take a
sick day and lose elgibility? Welcome to an environment of malicious
compliance, UA.

~~~
13of40
Maybe I didn't drill deep enough, but I didn't see the part where they tied it
to sick leave. Wouldn't that be illegal?

~~~
sk5t
From the article:

> in order to be eligible for the lottery, employees would have to have
> perfect attendance during the time period. Employees took that to mean no
> sick days.

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scarface74
Yes this is dumb.

But how does the previous bonus based solely on company profit incentivize
anyone? In the grand scheme of things, most individuals at a company have very
little affect on the company profit and the affect of one person is so diffuse
it's meaningless.

I've never worked for a company that emphasizes perfect attendance, but my
wife has. Why would any company want to encourage any employee to come to work
sick and maybe contagious? Especially when they are confined to small quarters
like an airline?

~~~
bkor
> Why would any company want to encourage any employee to come to work sick
> and maybe contagious?

I noticed such policies at some companies which had a very high sick leave
percentage. Sometimes it's difficult to determine if someone is faking being
sick. I guess one way of to try and solve that is giving people money. I hope
nobody does this when the sick leave percentage is average due to mentioned
working while sick is bad result.

~~~
scarface74
I use to think why have sick leave at all and just give everyone a PTO bucket.
Instead of having 10 sick days and 10 vacation days, split it and give
everyone 15 days PTO. It would give people more flexibility and management
would have to worry about if someone was _really_ sick.

But then there are still issues...

1\. People come in sick to save their PTO and spread what they have if it's
contagious.

2\. It works well for most salaried employees. We can work from home, claim we
are working even if we aren't being productive and catch up over the weekend
or when we feel better (I don't see an ethical problem with that.) A lot of
hourly jobs can't time or place shift like that.

3\. Salaried employees, usually don't have to call in sick for a sick child
(we work from home), or for doctors appointments. We can usually make our time
up.

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noonespecial
You've just got to shake your head and wonder if the "management" who thought
this might be a good idea have ever met any actual human beings.

~~~
hinkley
How's your fiction writing? I think you have the basis of a dystopia where AI
replaces management and nobody notices they're robots until it's too late.

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anonytrary
More information on the policy:

[https://www.inc.com/bill-murphy-jr/united-airlines-
employees...](https://www.inc.com/bill-murphy-jr/united-airlines-employees-
were-shocked-to-learn-about-this-stunning-new-company-
policy.html?utm_source=red)

TLDR:

> A new report says [United Airlines] plans to do away with quarterly employee
> performance bonuses--and replace them instead with random drawings for
> prizes like like cash, automobiles, and vacations.

\---

How will this encourage employees to perform admirably? After David Dao's
beating and forced removal from a flight, this seems like quite a poor
decision.

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bcherny
This is a super interesting piece of behavioral economics in action.

We know from Prize Linked Savings Accounts that people prefer a really small
change of winning a lot to a really high chance of winning a little. [0] [1]

> The new program replaces that system with a lottery. If United meets its
> goals, all employees would have a chance to win prizes, including Mercedes
> automobiles and cash up to $100,000. About 1.6 percent of employees would
> win something.

If I recall, there was a study that showed that people were happier when given
a paid vacation than when given an equivalent bonus.

[0]
[http://www.hbs.edu/faculty/Publication%20Files/08-061_17c22e...](http://www.hbs.edu/faculty/Publication%20Files/08-061_17c22e32-fe06-4b4a-8b5e-e09227fc8104.pdf)

[1]
[https://www.sciencedirect.com/science/article/pii/S016726811...](https://www.sciencedirect.com/science/article/pii/S0167268114002194)

~~~
mattnewport
The replication crisis most associated with psychology also appears to extend
to many behavioral economics results. There's good reason to be skeptical of
many of these studies.

~~~
bcherny
Can you talk more about that? Are you saying those studies haven’t been
replicated?

~~~
mattnewport
I don't know about those studies in particular but the general replication
crisis
[https://en.m.wikipedia.org/wiki/Replication_crisis](https://en.m.wikipedia.org/wiki/Replication_crisis)
which is most widely discussed in psychology is also a concern in economics
[https://theconversation.com/the-replication-crisis-has-
engul...](https://theconversation.com/the-replication-crisis-has-engulfed-
economics-49202)

Behavioral economics research in some respects has more in common with
psychology research than other areas of economics. It is also associated with
a particular ideological bent that seeks to undermine the traditional
assumption in economics that people can be approximated as rational actors.
While there is value in recognizing where that assumption can break down,
behavioral economics is often used to justify policies or interventions that
traditional economics would not recommend on the basis that people can't be
trusted to act in their own best interests so their preferences should be
ignored or overridden by benevolent experts who somehow are miraculously
immune from the same failures of rationality that the rest of us proles are
prone to.

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turbulents
$100,000 is way better than $1,500, right? Knowing the airline industry, this
is a cost-cutting measure designed to try to trick you into thinking it's an
improvement.

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dahdum
The point of this is clearly to reduce their bonus expenditures. Doing so
directly would be seen as an attack on the unions, so they pull this
harebrained lotto system out of their hat and pretend they are trying to
innovate.

When it fails in a year or two, they’ll make a show of listening to their
employees and bring back a bonus program similar to the old one but with
significant cuts to the amounts and focus on attendance for qualification.

At least that’s what it looks like to me.

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dennis_nedry
Not to mention a $100K bonus is enough for some people to quit, and take their
lives elsewhere, so theoretically, there’s probably a motive of attrition as a
subtext to force out a cross section of expensive veteran employees.

Brain drain is a factor in this, but probably some brutal downsizing is in the
picture, and on the table already. Hold on to your butts.

------
chrisbennet
I wonder if United’s president (Scott Kirby) would be OK with his own
performance compensation being determined via a lottery system? You know,
would he feel sufficiently incentivized by a 1.6% chance (say) of getting his
millions in stock options?

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adora
Dilbert IRL.

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purplezooey
It seems tailored for social media. "look at me I won". A lot of things are
going this route. dumb.

~~~
drozycki
The execs probably hope to leverage irrationality around games of chance. This
will provide net morale at a lower program cost. It's good that this
innovation will be nipped in the bus before it spreads across corporate
America.

~~~
leibnizwasright
This won't be the last time they try.

