SkyWest Airlines 2015 Annual Report Download - page 128

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Company’s executive compensation programs. The Compensation Committee performed such a review in 2015 that
included a review of the executive compensation practices of peer transportation companies including, but not limited to
Allegiant, Hawaiian Holdings, JetBlue, Republic Airways, Virgin America, Alaska Air Group, Hub Group, Werner
Enterprises and Spirit Airlines. The Compensation Committee did rely upon such review of peer company compensation
practices. The executive compensation procedures and the Compensation Committee assessment process are designed to
be flexible in an effort to promptly respond to the evolving business environment and individual circumstances.
Role of Consultants. Neither the Company nor the Compensation Committee has any contractual arrangement
with any compensation consultant for determining the amount or particular form of any Executive’s compensation.
During 2014 and 2015, the Company and Compensation Committee received advice from Frederic W. Cook & Co., Inc.
(“F.W. Cook”) with respect to executive compensation practices and trends generally and within the airline industry. The
Company and the Compensation Committee retained F.W. Cook to make recommendations regarding the specific
amount or forms of compensation awarded to Executives in 2014 and 2015. The Company and the Compensation
Committee will continue to periodically seek the advice of such consultants, as deemed necessary, in the future. The
Compensation Committee has sole authority to hire and fire external compensation consultants.
No Employment and Severance Agreements. The Executives do not have employment, severance or
change-in-control agreements, although the vesting of stock options, restricted stock, restricted stock units, performance
shares and performance units generally is accelerated upon a change in control of the Company. The Executives serve at
the will of the Board, which enables the Board to terminate the employment of any Executive with discretion as to the
terms of any severance. This is consistent with the Company’s performance-based employment and compensation
philosophy.
Compensation Committee Consideration of Shareholder Advisory Vote. At the Company’s Annual Meeting of
Shareholders held in May 2015, the Company submitted the compensation of its named executive officers to the
Company’s shareholders in a non-binding vote. The Company’s executive compensation program received the support
of more than 63% of the shares represented at the meeting. The Compensation Committee considered the results of the
2015 vote and views the outcome as evidence of positive shareholder support of its executive compensation decisions
and policies. The Compensation Committee made some revisions to the Company’s executive compensation program for
2015 in an effort to better align the compensation packages of the Executives with the executive compensation programs
of other regional carriers and major airlines. The Compensation Committee will continue to review completed
compensation surveys and future shareholder voting results, including the voting results with respect to “Proposal 2—
Advisory Vote on Executive Compensation” described in this Proxy Statement, and determine whether to make any
changes to the Company’s executive compensation program in light of such surveys and voting results.
Elements of Compensation
The Company’s executive compensation objectives and principles are implemented through the use of the
following principal elements of compensation, each discussed more fully below:
• Salary
• Annual Bonus
• Long-Term Awards
• Retirement and Other Benefits
The compensation objectives for each Executive are more fully described in the following paragraphs.