Profit Sharing Questions.

[ScudRunner]

Hi everyone, I have a friend at University doing a paper on companies that do profit sharing. She's has chosen WestJet to do her paper on, anyway is there someone on here that would like to help her out and pass a few Question's and Answers. You could PM me with your email that I could pass along that would be great.

Anyway I think her first Question is just he basic stuff like how it works?

[ScudRunner]

Really 192 Views not one response, not even a PM. She's really hot and in Kamloops I know you fly there. Anyone?

[Rotten Apple #1]

.., why don't YOU post the questions here and perhaps WE will decide if they are appropriate questions to respond to. Typically, in a university paper, attribution is required for verification. I find it difficult to believe anyone here will consent to that.

Perhaps a call to WJ's PR department might be helpful as well.

Standing by.

JD

[Four1oh]

not to mention there's lots of information right on the Westjet website, and Google will supply far more quotable answers than you'll get in here.

[ScudRunner]

Hey thanks, she's got a few people helping out now. And is in contact with Westjet P.R.

Trust me she's doing her homework.

[express]

how much is profit sharing going to be this november compared to last? anyone have an educated guess???

[Four1oh]

would you settle for an uneducated guess?

[Rotten Apple #1]

Can you give me a week to work it out?

[KAG]

2/3 or alittle more then May's, thats my guess...

[CanadaEH]

Half or less than half of last November's. There was not a lot of money set aside for profit share in Q2.

[Rotten Apple #1]

More than what I got at Air Atlantic, Royal, and Canada 3000 put together...not to mention Uncle Gus in YYT...

[True North]

Half or less than half of last November's. There was not a lot of money set aside for profit share in Q2.

Are you suggesting WestJet did not make a profit last Q2?

TN

[Four1oh]

I'm going to guess less than nov '07, but as good or better than spring '08.

[CanadaEH]

Are you suggesting WestJet did not make a profit last Q2?

Uhh where did you read that? Please re-read what I posted: There was not a lot of money set aside for profit share in Q2. A percentage of profit is set aside for profit sharing. That portion in Q2 of 2008, was not very large (off the top of my head - $3.2M?). I need to go back and look at our previous amounts..

Ok I just checked and based on our previous figures:

May:
Q1 '08-13.1M
Q4 '07- 8.8M
Total.... 21.9

November:
Q3 '07-27.7M
Q2 '07- 5.3M
Total.... 33M

Also, I was wrong on the estimate for our Q2 2008. We only have $2.2M set aside for profit share at this point.

It was Our profit share expense for the quarter ended June 30, 2008 was $2.2 million, a 59.3 per cent decrease from $5.4 million for the same quarter of 2007. This variance was directly attributable to the lower earnings eligible for profit share due to higher fuel costs.

Q3 will need to be a killer quarter for November to be even half of what it was last year.

[McDoo the Irish Navigator]

More than what I got at Air Atlantic, Royal, and Canada 3000 put together...not to mention Uncle Gus in YYT...

You and me both, old buddy. Best guesses put this month's cheque somewhere between last Nov. and last May's.
Someone of your stature should take home about $7500.
How are your folk's these days?

[express]

anyone know how much was put aside for profit share in Q3??? Revised estimates???

[CanadaEH]

$13.7M. Roughly 40% of what we got last November.

[Legacy]

Yeah the profit sharing thing makes no sense to me. 3rd quarter 2007 profit was 76.1 million and they shared roughly 28 million. So approx 37% of the profit was put to profit share. This years Q4 profit was 55 million and they shared 13.7 million which is 25%. So why the drastic reduction in shared profit? What I don't understand is when they attribute the low profit share to high fuel costs. Does that really matter? Its what is left over in your pocket AFTER the bills are paid for that should matter and there has been a lot of money left over in the pocket this year. Would be nice to know exactly how this works. Heck our profit share this november is less than may. That must be a new one.

[Jonsey]

The amount they put toward profit share depends on the profit margin of that period I believe.

[CanadaEH]

That must be a new one.

No, it's not. I've been here for 6 years and I've gotten as little as nothing to as much as last November and everywhere in between. I'm disappointed at our results given the strength of this company, but at the end of the day we are the most profitable airline in NA and, I read on another forum, in the top 3 for most profitable in the world. I'll assume that's on a profit margin basis. We've got a shitload of money in the bank and one of if not the healthiest balance sheets of any airline operating in NA. There is a formula and I always forgot what that formula is, but I'm sure if you dig around Westnet you'll find it..

[Legacy]

Ahhh so there is a formula. gotcha.

[Ryan Coke2]

I believe.......

A minimum of 10% of the profit, up to a max of 20%, matching the operational margins.

In other words, if margin is 5%, profit share is 10% of profit.
--------------------------15%,--------------15%--------
--------------------------25%---------------20%-------

[Blastor]

The Difference Between Gainsharing & Profit Sharing

Many people who confuse Profit Sharing and Gainsharing view them as being one in the same. Employees have an opportunity to earn a bonus under both approaches, but that is where the similarity ends. There are always exceptions, but the following provides a general outline of the major differences.

Purpose

Gainsharing : To drive performance of an organization by promoting awareness, alignment, teamwork, communication and involvement

Profit Sharing: To share the financial success of the total organization and encourage employee identity with company success.

Application

Gainsharing : The plan commonly applies to a single facility, site, or stand-alone organization

Profit Sharing: The plan typically applies organization-wide; companies with multiple sites typically measure organization-wide profitability rather than the performance of a single site.

Measurement

Gainsharing : Payout is based on operational measures (productivity, quality, spending, service), measures that improve the “line of site” in terms of what employees do and how they are compensated

Profit Sharing: Payout is based on a broad financial measure of the organization’s profitability.

Funding

Gainsharing : Gains and resulting payouts are self-funded based on savings generated by improved performance.

Profit Sharing: Payouts are funded through company profits

Payment Target

Gainsharing : Payouts are made only when performance has improved over a historical standard or target.

Profit Sharing: Payouts are typically made when there are profits; performance doesn’t necessary have to show an improvement.

Employee Eligibility

Gainsharing : Typically all employees at a site are eligible for plan payments.

Profit Sharing: Some employee groups may be excluded, such as hourly or union employees.

Payout Frequency

Gainsharing : Payout is often monthly or quarterly. Many plans have a year-end reserve fund to account for deficit periods.

Profit Sharing: Payout is typically annual.


Form of Payment

Gainsharing : Payment is cash rather than deferred compensation. Many organizations pay via separate check to increase visibility

Profit Sharing: Historically profit plans were primarily deferred compensation plans; organization used profit sharing as a pension plan. Today we see many more cash plans.

Method of Distribution

Gainsharing : Typically employees receive the same % payout or cents per hour bonus.

Profit Sharing: The bonus may be a larger % of compensation for higher-level employees. The % bonus may be less for lower level employees

Plan Design & Development

Gainsharing : Employees often are involved with the design and implementation process

Profit Sharing: There is no employee involvement in the design process.

Communication

Gainsharing : A supporting employee involvement and communication system is an integral element of Gainsharing and helps drive improvement initiatives.

Profit Sharing: Since there is little linkage between “what employees do” and the “bonus,” there is an absence of accompanying employee involvement initiatives.

Pay for Performance Plan versus Entitlement

Gainsharing : Gains are generated only by improved performance over a predetermined base level of performance. Therefore, Gainsharing is viewed as a pay-for-performance initiative.

Profit Sharing: Profit sharing often is viewed as a entitlement or employee benefit

Impact on Behaviors

Gainsharing : Gainsharing reinforces behaviors that promote improved performance. Used as a tool to drive cultural and organization change.

Profit Sharing: Little impact on behaviors since employees have difficulty linking “what they do” and their “bonus.” Many variables outside of the typical employee’s control determine profitability and the bonus amount.

Impact on Attitudes


Gainsharing : Heightens the level of employee awareness, helps develop the feeling of self worth, builds a senses of ownership and identity to the organization.

Profit Sharing: Influences the sense of employee identity to the organization, particularly for smaller organizations




http://www.masternak.com/gainsharing-ve ... agodL1ISJA

[Blastor]

How does Profit sharing work? The company contributes a portion of its pre-tax profits to a pool that will be distributed among eligible employees. The amount distributed to each employee may be weighted by the employee's base salary so that employees with higher base salaries receive a slightly higher amount of the shared pool of profits. Generally this is done on an annual basis.

Advantages

•Brings groups of employees to work together toward a common goal (the success/benefit of the company).

•Helps employees focus on profitability.

•The costs of implementing the plan rise and fall with the company's revenues.

•Enhances commitment to organizational goals.


Disadvantages


The pay for each employee moves up or down together (no individual differences for merit or performance).

Focuses only on the goal of profitability (which may be at the expense of quality).


For smaller companies, these plans may result in drastic swings in earnings for employees which the employees may find difficult to manage their personal finances.


Adherence to the FLSA requires employers to recalculate each worker's "regular rate" of pay. To overcome this limitation, employers may restrict this type of compensation to exempt employees.
•

[Rotten Apple #1]

Blastor-bator, that's a lotta high-falutin' ritt'n mister.

Now, you may or may not glean from my posts that I'm not one to gild the lily.

Well, I'm not.

Ergo,

the 'gross' amounts for 2007 and 2008 profit sharing for jonny dangerous were as follows:

2007: $19107.97
2008: $13201.40

I am not sure where that fits into the info you quoted above. Perhaps you could supply the commentary.

Personally, I am expecting less in 2009 (due to ongoing macro-economic travails), but this company has surprised me before (actually, this morning when I read our November traffic stats) so it could be decent.




Take care,

Jonny (big fan of your work)


p.s. ca va-de-soi que le gouvernement a pris son lot des chiffres au-dessus. Et j'ai tente(') de trouver les resultats pour l'annee(') 2006 mais ce n'etait possible. Malheureusement.

Co-lisse,
Tabernac!!!

'oo 'as my Cinquante?