Profit Sharing Predictions
01-11-2017 | 08:01 AM
#41
Gets Weekends Off
Joined: Aug 2007
Posts: 862
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Funny enough I think they are both right.
1) If you cut the number of pilots in half you do not automatically get double the amount.
2) If there are fewer pilots then you might get more.
BUT . . .
crazy enough you might get more even if there are more pilots
Here's an attempt at an explanation . . .
First lets just say for the sake of this discussion that no matter how many pilots we have, the profit sharing pool is constant, which wouldn't be the case in real life since if there were a dramatic change in pilots that would imply a dramatic change in revenue, but anyways the question is about a few extra pilots on the margin and what impact they have so let's just assume a constant pool.
So the profit sharing pool is $1,000.
In the first example lets say there are 20 pilots. 10 pilots earned $100 and 10 pilots earned $10 in W2 wages. Each pilot that earned $100 gets $100/$1100 of the pool or 9.09% or $90.90 in profit sharing. Each pilot that earned $10 gets $10/$1100 or .909% or $9.09 each.
10 * $90.90 = $909.00
10* $09.09 = $090.90
Now imagine we add 3 new pilots and retire 2 pilots and the pool comes out the same to $1000. This time we have more pilots. Do senior guys get less money because there are more pilots?
Well . . .
First now we have 8 pilots earning $100 and 13 pilots earning $10. The total W2 pool is now 8 * $100 + 13 * $10 = $930. So the senior guys now get $100/$930 or 10.75% or $107.52 and the junior guys get $10/$930 or 1.075% or $10.75.
Magically we have more pilots but everybody got more money!!! How you ask, because the 2 pilots that left were getting about $200 in combined profit sharing and the new guys are only getting about $30 combined so there's $170 more to spread around.
I won't bore you with the details, but if we were to add more high paying pilots the opposite would happen.
Does adding more pilots lower your personal take? It depends, but probably not much if at all.
1) If you cut the number of pilots in half you do not automatically get double the amount.
2) If there are fewer pilots then you might get more.
BUT . . .
crazy enough you might get more even if there are more pilots
Here's an attempt at an explanation . . .
First lets just say for the sake of this discussion that no matter how many pilots we have, the profit sharing pool is constant, which wouldn't be the case in real life since if there were a dramatic change in pilots that would imply a dramatic change in revenue, but anyways the question is about a few extra pilots on the margin and what impact they have so let's just assume a constant pool.
So the profit sharing pool is $1,000.
In the first example lets say there are 20 pilots. 10 pilots earned $100 and 10 pilots earned $10 in W2 wages. Each pilot that earned $100 gets $100/$1100 of the pool or 9.09% or $90.90 in profit sharing. Each pilot that earned $10 gets $10/$1100 or .909% or $9.09 each.
10 * $90.90 = $909.00
10* $09.09 = $090.90
Now imagine we add 3 new pilots and retire 2 pilots and the pool comes out the same to $1000. This time we have more pilots. Do senior guys get less money because there are more pilots?
Well . . .
First now we have 8 pilots earning $100 and 13 pilots earning $10. The total W2 pool is now 8 * $100 + 13 * $10 = $930. So the senior guys now get $100/$930 or 10.75% or $107.52 and the junior guys get $10/$930 or 1.075% or $10.75.
Magically we have more pilots but everybody got more money!!! How you ask, because the 2 pilots that left were getting about $200 in combined profit sharing and the new guys are only getting about $30 combined so there's $170 more to spread around.
I won't bore you with the details, but if we were to add more high paying pilots the opposite would happen.
Does adding more pilots lower your personal take? It depends, but probably not much if at all.
01-12-2017 | 05:36 PM
#43
Gets Weekends Off
Joined: Oct 2012
Posts: 328
Likes: 0
From: 737 FO
First time getting a profit sharing check.... Is it true we will find out tomorrow (Jan 13th)what it is going to be? Where will the information be posted? Or will it come via email from the union?
Thanks!
Thanks!
01-12-2017 | 06:46 PM
#44
Gets Weekends Off
Joined: Feb 2011
Posts: 3,866
Likes: 0
Stay tuned here. As soon as percentage of W2 is released someone will be post it here.
01-12-2017 | 07:48 PM
#46
Thread Starter
Line Holder
Joined: Jun 2010
Posts: 943
Likes: 0
From: 747 Captain, retired
I just checked, UAL reports on the 19th of January so we will know the size of the Profit sharing by the 20th or 21st.
01-13-2017 | 05:26 AM
#47
Line Holder
Joined: Dec 2010
Posts: 650
Likes: 5
From: 787 Capt.
Funny enough I think they are both right.
1) If you cut the number of pilots in half you do not automatically get double the amount.
2) If there are fewer pilots then you might get more.
BUT . . .
crazy enough you might get more even if there are more pilots
Here's an attempt at an explanation . . .
First lets just say for the sake of this discussion that no matter how many pilots we have, the profit sharing pool is constant, which wouldn't be the case in real life since if there were a dramatic change in pilots that would imply a dramatic change in revenue, but anyways the question is about a few extra pilots on the margin and what impact they have so let's just assume a constant pool.
So the profit sharing pool is $1,000.
In the first example lets say there are 20 pilots. 10 pilots earned $100 and 10 pilots earned $10 in W2 wages. The total W2 pool is 10 * $100 + 10 * $10 = $1100. Each pilot that earned $100 gets $100/$1100 of the pool or 9.09% or $90.90 in profit sharing. Each pilot that earned $10 gets $10/$1100 or .909% or $9.09 each.
10 * $90.90 = $909.00
10* $09.09 = $090.90
Now imagine we add 3 new pilots and retire 2 pilots and the profit sharing pool remains the same at $1000, but this time we have more pilots. Do senior guys get less money because there are more pilots?
Well . . .
First now we have 8 pilots earning $100 and 13 pilots earning $10. The total W2 pool is now 8 * $100 + 13 * $10 = $930. So the senior guys now get $100/$930 or 10.75% or $107.52 and the junior guys get $10/$930 or 1.075% or $10.75.
Magically we have more pilots but everybody got more money!!! How you ask, because the 2 pilots that left were getting about $200 in combined profit sharing and the new guys are only getting about $30 combined so there's $170 more to spread around.
I won't bore you with the details, but if we were to add more high paying pilots the opposite would happen.
Does adding more pilots lower your personal take? It depends, but probably not much if at all.
1) If you cut the number of pilots in half you do not automatically get double the amount.
2) If there are fewer pilots then you might get more.
BUT . . .
crazy enough you might get more even if there are more pilots
Here's an attempt at an explanation . . .
First lets just say for the sake of this discussion that no matter how many pilots we have, the profit sharing pool is constant, which wouldn't be the case in real life since if there were a dramatic change in pilots that would imply a dramatic change in revenue, but anyways the question is about a few extra pilots on the margin and what impact they have so let's just assume a constant pool.
So the profit sharing pool is $1,000.
In the first example lets say there are 20 pilots. 10 pilots earned $100 and 10 pilots earned $10 in W2 wages. The total W2 pool is 10 * $100 + 10 * $10 = $1100. Each pilot that earned $100 gets $100/$1100 of the pool or 9.09% or $90.90 in profit sharing. Each pilot that earned $10 gets $10/$1100 or .909% or $9.09 each.
10 * $90.90 = $909.00
10* $09.09 = $090.90
Now imagine we add 3 new pilots and retire 2 pilots and the profit sharing pool remains the same at $1000, but this time we have more pilots. Do senior guys get less money because there are more pilots?
Well . . .
First now we have 8 pilots earning $100 and 13 pilots earning $10. The total W2 pool is now 8 * $100 + 13 * $10 = $930. So the senior guys now get $100/$930 or 10.75% or $107.52 and the junior guys get $10/$930 or 1.075% or $10.75.
Magically we have more pilots but everybody got more money!!! How you ask, because the 2 pilots that left were getting about $200 in combined profit sharing and the new guys are only getting about $30 combined so there's $170 more to spread around.
I won't bore you with the details, but if we were to add more high paying pilots the opposite would happen.
Does adding more pilots lower your personal take? It depends, but probably not much if at all.
"It was my understanding that there would be no math" when I joined this forum.
01-13-2017 | 01:59 PM
#49
Gets Weekends Off
Joined: Oct 2010
Posts: 2,639
Likes: 0
It looks like the release has been moved forward.
From the UAL Investor Relations website:
United Airlines will hold a conference call to discuss full-year and fourth-quarter 2016 financial results on Wednesday, January 18, at 9:30 a.m. CT/10:30 a.m. ET. A live, listen-only webcast of the conference call will be available at ir.united.com. The company will issue its full-year and fourth-quarter financial results and first-quarter 2017 investor update after market close on Tuesday, January 17.
And from today's email from the ALPA R&I Committee:The 4Q/FY 2016 United Continental Holdings, Inc., earnings results are slated to be released after the market close on January 17, and the earnings conference call will be held at 9:30 Central on January 18. A link to follow the call can be found here. Typically, the employee profit sharing participation is announced shortly after the earnings are released. The MEC Retirement and Insurance Committee will report on the pilots’ profit sharing participation and how to make a 401k election on your amount following the release of these numbers.
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