Employees of Southwest Airlines will get a portion of the company's settlement with Boeing over the problems with 737 MAX aircraft, according to an announcement released Thursday.
Southwest's Board of Directors approved "a discretionary, incremental profit-sharing accrual for employees" that is currently estimated to be about $125 million, the company said in the announcement.
It will be a part of the airline's annual profit-sharing distribution in 2020 for the 2019 year.
While the settlement figure itself is confidential, it was "for a portion of projected financial damages related to the grounding" of the Boeing planes. Those projected financial damages number in the hundreds of millions of dollars for Southwest, which is the largest operator of the aircraft.
The company said in July that the grounding of the planes in March had a financial impact of $225 million for the first half of 2019.
Boeing is anticipating having to pay up for the damage the 737 Max has caused, as the Chicago-based company recorded a $4.9 billion charge in the second quarter for potential settlements.
Like other airlines, Southwest has taken thousands of flights off its schedule this year as it works with a smaller fleet than anticipated.
"Our people have done an incredible job managing through the MAX groundings while providing the highest levels of customer service and one of the best operational performances in our history," Gary C. Kelly, Chairman of the Board and Chief Executive Officer, said in the announcement. "On behalf of the Southwest Board of Directors, we are grateful to our employees for their extraordinary efforts throughout the year and are pleased to share proceeds from our recent agreement with Boeing."
Without the planes, Southwest says it will cancel about 175 flights each weekday. Southwest had 34 MAX planes when they were grounded in March and had expected many more to be delivered this year.
In early November, the airline said it would keep the MAX out of its schedule until March 6, about a month longer than previously planned, citing continued uncertainty.
The airline says it's monitoring information from Boeing and the Federal Aviation Administration about software improvements and pilot-training requirements that will be part of returning the plane to flight.
American Airlines says their Boeing 737 Max jets are expected to return to service by March 5, 2020.
