NEW YORK (CNN/Money) -
Former AMR Corp. CEO Don Carty, who resigned his post in April after a controversy over executive compensation, will not receive a severance package from the parent of American Airlines, according to published reports.
The Forth Worth Star Telegram, the paper in AMR's home town, reported that Carty did not ask for or receive any severance package. The Wall Street Journal reported Monday that he will receive an $8.2 million lump-sum after-tax payment from a supplemental pension plan for senior executives, though.
That company's decision to fund that supplemental pension plan in order to protect pension payments for its top paid executives is one of the factors that caused a outcry from the airline's unions in April and almost forced the world's largest airline into bankruptcy court.
The other executive pay issue that angered unions was retention bonuses for Carty and other top officers that would have paid them as much as twice their base salary if they stayed at the airline through January 2005.
Carty apologized to employees for the executive compensation plans and the airline dropped the retention plan, but not the funding of the executive pension plan, following the outcry.
Carty's resignation April 24 came as the company was on the verge of filing for bankruptcy. The next day it announced it had reached an eleventh-hour deal to keep union concessions in place that saved the company $1.8 billion a year in labor costs. Those labor deals were nearly scrapped by the unions due to anger over executive pay.
Carty, 58, who had been CEO for five years and with American for more than 20 years, also will receive an annual $79,000 pension payment from its company-wide pension plan, the Journal reported. The paper said that since Carty did not have a contract, he was not legally entitled to a severance package, but it would not have been unusual for a long-time executive to be given such a payment following this kind of departure.
The company had been declining to comment on any severance package since Carty's resignation was announced. The Journal quoted AMR spokesman Al Becker as saying the company's board decided to let employees know that Carty wouldn't receive a severance package, "given the unusual set of circumstances involving Mr. Carty's leaving American."
Shares of AMR (AMR: Research, Estimates) lost 29 cents to $8.51 in trading Friday.
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