The imputed income (taxes withheld) has always been there. It is NOT a UA-only thing, it's a taxable benefit as seen by the IRS. UA does not get that money, the government does. That said, the amount of imputed income does seem to depend on the airline, but I have no idea how that works. Either way, that's something that your friend (the employee) did not research enough and honestly should have known about.

As for the fares being charged, I'll admit that's a bit fishy to do retroactively. I really don't know the details of that, but that's something between you, your friend, and the employee travel center. There really isn't anything that we can do out here. I would just recommend that he call the ETC if possible, not email, as they can be really slow about that.