Financial wellbeing | FedEx scraps annual employee bonus

Worldwide delivery giant FedEx has confirmed rumours that it is to scrap its annual incentive bonuses for 2019, in what it calls an ‘austerity move’.

The incentive compensation program (or AIC as it is known internally), bases year-end bonuses on percentages of employee pay – meaning many US employees may well stand to lose thousands of dollars, depending on pay grades.

In cancelling the scheme for 2019, the company intends to claw back some of the £1.1billion ($1.5billion) lapse in revenue for the fiscal year ending May 31.

“The international macroeconomic weakness and resulting revenue shortfall no longer support AIC funding, and our expectation is that there will be no AIC pay-out this year,” FedEx Corp. Executive Vice President and Chief Financial Officer Alan B. Graf, said in a company-wide memo to employees on Tuesday.