Key facts
- Japan Airlines CEO Mitsuko Tottori is taking a 30% pay cut for two months.
- The pay cut follows an "alcohol-related incident" involving two cabin crew members.
- Two other executives will face a 20% pay reduction for one month.
- Other directors and executive officers will receive 10% reductions for one month.
- The incident led to one cabin attendant being fired and another suspended.
- Pay cuts for senior executives due to employee misconduct are common in Japan.
Japan Airlines CEO Mitsuko Tottori is implementing a temporary pay cut of 30% for two months, alongside reductions for other executives, following an "alcohol-related incident" involving two cabin crew members. The airline described the episode as an "extremely serious management failure."
Two executives responsible for safety and cabin operations will see their compensation reduced by 20% for one month, while all other directors and executive officers will face a 10% reduction for the same period. The incident, reported by Kyodo News, involved two cabin attendants consuming alcohol before a domestic flight, a violation of company policy. One attendant was fired, and the other was suspended.
A spokesperson for Japan Airlines stated that these measures demonstrate an "uncompromising commitment to strengthening our oversight and executing fundamental organizational reform," accepting "full accountability for the structural weaknesses that failed to prevent this incident."
This practice of senior executives taking pay cuts due to the misconduct of lower-level employees is a recognized aspect of Japanese corporate culture. Professor Curtis Milhaupt of Stanford Law School noted that while voluntary pay cuts are a standard sign of contrition, they are not always a foolproof deterrent to misconduct, often serving as a symbolic gesture of responsibility.
Recent examples include Kentaro Okuda, CEO of Nomura Holdings, who took a three-month pay cut after a former employee was charged with serious crimes, and executives at MUFG Bank who also took three-month pay reductions after an employee was accused of stealing from customer deposit boxes.