In 2021, Expedia Group awarded Vice Chairman and CEO Peter Kern $296 million in compensation, outperforming all his peers by an order of magnitude and making him the third highest paid CEO of any American company.

See the table below outlining the 2021 compensation of the CEOs of Expedia Group, Booking Holdings, Tripadvisor and Airbnb. The companies disclosed executive compensation in May.

On paper, Kern’s windfall makes Airbnb co-founder and CEO Brian Chesky’s $120 million 2020 package seem like a relatively pittance.

All of these comparisons are apples to oranges. We will explain to you.

To put all of this into perspective, on the surface, Kern’s compensation package for 2021 has a ratio of 2,897:1 compared to the median salary of Expedia employees, which was $102,270.

However, Kern’s 2021 pay package actually covers three years plus Covid-tinged 2020 compensation, while Expedia’s median employee salary was calculated for one year. (Chesky’s payload in 2020 covered 10 years.)

“On February 25, 2021, Expedia Group entered into an employment agreement with Mr. Kern expiring on April 22, 2024 (the “Kern Employment Agreement”), after which Mr. Kern is expected to continue to serve as Vice executive chairman of the company until at least June 1, 2026,” Expedia Group said in a financial filing.

The company said Kern should not seek additional compensation during the term of his employment pact. Although the employment contract began in 2021, it included a base salary payment of $728,000 covering Kern’s first day as CEO on April 22, 2020 until the official start of the employment contract 10 months later. .

So over a four-year span, Kern’s big payday would actually amount to a more modest — and still gargantuan — average of $74 million a year if the stock does well. That’s far more than its peers at Booking Holdings, Tripadvisor, and Airbnb.

CEO of an Online Travel Agency Pay 2021

CEO Company Pay (all inclusive)
Pierre Kern Expedia Group $296 million
Glenn Fogel Reserve credits $54 million
Steve Kafer Tripadvisor $7.6 million
Brian Chesky Airbnb $132,152

Source: Financial documents

If Kern were to actually receive the $296 million over a four-year period, he would earn approximately $35,576 per hour based on a 40 hour work week.

This should give pause to Expedia Group board member Chelsea Clinton, who chaired the compensation committee in 2021. Chelsea Clinton, vice chair of the Clinton Foundation, campaigned for her mother and presidential candidate of 2020, Hillary Clinton, who supported a $15 national minimum wage.

Chelsea Clinton and the other two members of Expedia’s Board of Directors Compensation Committee drew a large number of withheld votes in their ultimately successful elections to the Expedia Board of Directors this month. There has been no public expression of what prompted the withheld votes, which often indicates annoyance Kern’s compensation package may have been a trigger.

But there are plenty of caveats in Kern’s package beyond the fact that it spans multiple years. The company said “he is not expected to receive additional equity compensation for the three-year term of his employment contract.”

The vast majority of Kern’s package is made up of stock and option awards that would vest over several years, and the amounts are estimates that may not materialize depending on Expedia’s stock performance.

Kern’s package was based in part on the performance of Expedia shares since he took over as CEO until the end of 2021. However, the shares, like much of the market, have performed poorly in 2022.

Expedia Stock Performance from April 22, 2020 to December 31, 2021

In proposing the $296 million package, Expedia said its compensation committee considered Kern’s leadership during the pandemic, including its strategy of consolidating technology platforms, cutting costs it has made and the financing deals he helped secure, and the growth in share price, which was 194% through the end of 2021.

Glenn Fogel, CEO of Booking Holdings

Booking Holdings CEO Glenn Fogel’s compensation in 2021 was $54 million. The company said that without prior year adjustments, Fogel’s 2021 compensation was $29.9 million. But the company adjusted Fogel’s prior-year grants upward because his performance share unit awards were twice target in 2018 and once target for 2019 before the pandemic.

In addition to Fogel’s $54 million, Booking Holdings general counsel Peter Millones’ aggregate compensation in 2021 was $19.5 million, as was CFO David Goulden’s $19.5 million compensation. in 2021.

Although Millones and Goulden were not CEOs, their payola bonuses were considerably larger than those of all the highest-paid American airline CEOs. Delta CEO Ed Bastian’s salary was $12.4 million, although the CARES Act capped airline CEO pay in 2021.

Steve Kaufer, CEO of Tripadvisor

Outgoing Tripadvisor CEO Steve Kaufer’s 2021 salary package was $7.6 million.

“The compensation committees granted Mr. Kaufer an equity award consisting of time-vested restricted stock units and time-vested non-qualified stock options with a value at the date of an award equal to $5,800,000 in aggregate based on the closing price of Tripadvisor’s common stock on the Nasdaq on the date of grant,” Tripadvisor said. “The value of the award was significantly lower than the previous long-term incentive award to Mr. Kaufer in recognition of his impending retirement sometime in 2022.”

In 2018, Tripadvisor awarded Kaufer nearly $48 million in compensation.

Brian Chesky, CEO of Airbnb

Airbnb CEO Brian Chesky’s 2021 compensation was just $132,152, but that followed a $120 million reward over 10 years from 2020.

As such, Chesky’s nominal award in 2021 was the only CEO salary among the bosses of Airbnb, Expedia Group, Booking Holdings and Tripadvisor where Chesky earned less – removing his 2020 award from the review – that the 2021 median salary for Airbnb employees, which was $202,541. As the following chart shows, the pay ratio between Chesky and Airbnb employees was 0.65:1.

Ratio of online travel agency CEO compensation to employee compensation

CEO Company Staff median Ratio to CEO compensation
Pierre Kern Expedia Group $102,270 2897:1
Glenn Fogel Reserve credits $58,005 931:1
Steve Kafer Tripadvisor $101,065 76:1
Brian Chesky Airbnb $202,541 0.65:1

Although companies calculate the ratio of CEO pay to employee pay somewhat differently, it’s worth noting the wide disparity in employee pay between these competitors. In 2021, the median salary at Airbnb was $202,541 compared to $58,005 at Booking Holdings. The majority of Booking employees are based in Europe.

As at Booking Holdings, several Airbnb executives received significant compensation in 2021: Airbnb rewarded chief technology officer Aristotle Balogh ($10.5 million), global head of accommodation Catherine Powell ($9. $6 million), chief financial officer Dave Stephenson ($9.5 million) and co-founder and chief strategy officer Nate Blecharczyk ($7.61 million).

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