Southwest Airlines Employees Are $27 Million Richer

The Dallas Morning News

Low fares don't necessarily mean low profits. For Southwest Airlines and its employees, low fares and low costs give them a lot of profits to share.

The Dallas airline said Wednesday that it will contribute more than $120 million to its employees' profit-sharing fund this year. That means that virtually all employees, excluding top executives, get 13.7 percent of what they earned in 1998.

"The employees work hard each year to ensure Southwest's success, and this is a great way to reward them for their efforts," Southwest chairman Herbert Kelleher said.

Southwest earned a record $433 million in 1998, and that resulted in the record profit-sharing of $120.7 million. Of that, $27.1 million will go to the 4,553 eligible employees.

Other airlines are also handing out profit-sharing to employees, although not as much per employee. American Airlines is distributing $300 million in profit-sharing checks Monday, equaling about 8 percent of 1998 salaries. Continental Airlines last month gave out more than $86 million, about 6.7 percent.

Unlike American and Continental, however, Southwest employees' distribution goes into investment accounts, where it stays until employees resign, retire or reach age 59.

But the money is piling up for longer-term employees. The company has shared profits since 1974.

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