Public transport HSL is starting to pay tangible bonuses to top management in the midst of a historic financial crisis

Helsinki The top management of regional transport (HSL) can expect a bonus of up to almost a year’s salary in the next few years. Board of HSL, which is responsible for organizing public transport has enabled a new kind of incentive program for managers and executives.

In practice, the CEO Mika Nykänen may, if successful, receive an additional bonus of a maximum of approximately EUR 145,000 and six profit center managers of a maximum of approximately EUR 86,000. The fees will be paid after a three-year period.

Nykänen’s total annual salary is just over 162,000 euros. Profit Area Managers Ilmari Mäkinen, Sini Puntasen, Johanna Wallinin, Mari Flinkin and Hannu Heikkinen the corresponding annual salary is more than 97,000 euros and Päivi Alakuijalan 96 000 euros

HSL is at the same time in a historically weak economic climate. In the previous two years, the interest rate pandemic has, according to the company, collapsed ticket revenues.

Last year, ticket revenue amounted to approximately EUR 235 million and the following year to approximately EUR 243 million. Before the pandemic in 2019, ticket revenue was EUR 383 million. The weak situation is likely to be followed by rising ticket prices and deteriorating service.

Assessing last year’s financial figures, Nykänen said that remedying the situation “will put increasing pressure on significant increases in passenger prices or service levels”.

“Most likely for both,” he added.

Just the exceptionally tight situation and the strong pressures for success are the chairman of HSL’s board of directors Matias Pajulan (kok) according to the reason for management bonuses.

“The pressures are harder than ever, and engaging management is critical,” says Pajula.

Achieving the reward goal requires “above-normal performance”.

According to Pajula, it is not realistic to reach all the goals in practice. Therefore, only some of the bonuses are likely to materialize. These are four chapters, the very difficult goal of which is to reach a ticket revenue of EUR 400 million.

“If we got to all the goals, the problems would be in the rearview mirror, but unfortunately it seems unlikely,” Pajula says.

In its economic crisis, HSL has also had to rely on the tax money of both its member municipalities and the state. Members have had to increase their ticket support for HSL to around 60%. Last year, the state’s interest rate subsidy was about 87 million euros.

“The share of the municipality should reach 50-55 percent during the strategy period,” says Pajula.

In the new under the incentive scheme, the maximum bonus is 30 or 15 percent of regular annual salary. It is a salary without bonuses, allowances and commissions.

A higher fee is reserved for the CEO and the heads of the profit areas. The lower fee applies to the heads of the units as well as to the key personnel appointed separately for the program. Nykänen has the power to nominate employees to the program separately, the decision will be made by HSL’s Board of Directors.

Staff According to Pajula, there is a need for commitment. According to Pajula, HSL will not be able to compete with the private sector for its experts.

The economy for the current year will be burdened by the omicron form of the coronavirus, which has been raging for at least the beginning of the year.

“If our management only thought about money, this would not commit anyone. But this performance bonus scheme is an indication of our will to commit, ”says Pajula.

For the first time, HSL is splitting the performance bonus system in two. In addition to the new management bonuses, performance bonuses are available for all employees. In them, the maximum remuneration is the monthly salary calculated from the annual salary.

Read more: Mika Nykänen was elected the new CEO of HSL – The appointment was decided by lot.