$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.
United Airlines Replaces Bonuses with a Lottery
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Re: United Airlines Replaces Bonuses with a Lottery
#12This 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…
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.
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?
Re: United Airlines Replaces Bonuses with a Lottery
#13Not 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.
Re: United Airlines Replaces Bonuses with a Lottery
#14Earlier quoted context omitted.
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.
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?
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.
Re: United Airlines Replaces Bonuses with a Lottery
#15This 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…
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.
Re: United Airlines Replaces Bonuses with a Lottery
#16This 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…
A low-odds, high-reward gamble may still be preferred to its complement, but we must also consider aversion to loss of the bonus to which employees are accustomed. The new program could--but probably still wouldn't--make sense if it were an incentive in addition to the bonus.
Re: United Airlines Replaces Bonuses with a Lottery
#17Yes 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?
Re: United Airlines Replaces Bonuses with a Lottery
#18This 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…
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.
Can you talk more about that? Are you saying those studies haven’t been replicated?
Re: United Airlines Replaces Bonuses with a Lottery
#19Earlier quoted context omitted.
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.
Can you talk more about that? Are you saying those studies haven’t been replicated?
I don't know about those studies in particular but the general 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...
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.
Re: United Airlines Replaces Bonuses with a Lottery
#20The 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.