United CEO's quick return to work could pay off big

United Airlines (UAL) CEO Oscar Munoz will be back at work on Monday, only two months after undergoing a heart transplant. There's a lot riding on the quick return, according a regulatory filing, which spells out the financial incentives and potential penalties facing the 57-year-old executive.

Los Angeles Times columnist David Lazarus uncovered United's filing, made just a day after Munoz's heart transplant in January, that spelled out what the CEO stands to gain by making a rapid return to his desk.

The employment pact between United and Munoz was inked Dec. 31, a week before his heart transplant, but two months after he suffered a major heart attack, which occurred only a month after he joined United.

Under the agreement, Munoz gets a $10.5 million bonus if he puts in six consecutive months of work. If he works an entire year, he gets a base salary of $1.25 million and a signing bonus of $5.2 million. He also becomes eligible for a yearly performance bonus of at least $3.75 million.

The incentives and salary all began with the start of the year, and given it's March, Munoz has only nine months remaining to meet the conditions.

He can also be terminated due to disability if he's "incapacitated for a period of at least 180 days by accident, sickness or other circumstances that renders (Munoz) mentally or physically incapable of performing the material duties as President and Chief Executive Officer."

"United is saying here that if he returns to work quickly, he gets rich," Kevin Murphy, an executive compensation expert at USC's Marshall School of Business, told Lazarus. "If he doesn't, he gets relatively little."

The columnist noted that he spoke to six cardiologists, who termed the return to work as not unheard of, but very fast.

"If I was a heart-transplant patient, I'd wait six months, a year, before going back to work," Dr. Morton Kern, a cardiologist at UC Irvine and the Long Beach Veterans Affairs Medical Center, told Lazarus.

United declined to elaborate on Munoz's situation or his compensation, the columnist said.

Jeff Smisek, Munoz's predecessor, stepped down in September amid a federal probe into United's handling of a case involving the former head of the Port Authority of New York and New Jersey, which operates Newark International Airport, a key United's hub.