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Should CEO's/Executives receive bonuses while in or filing for bankruptcy?

Engineer

Engineer

Elite Member
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I thought bonuses were a "reward"...how is it rewarding to lead a company into (and maybe out of) bankruptcy, asking employees to take a cut for the team and then giving hundreds of millions in bonuses?

Something seem screwed with this picture? Hopefully, bankruptcy court kicks them in the @ss but I doubt it.

:roll:

 
Originally posted by: Engineer
Click me!

I thought bonuses were a "reward"...how is it rewarding to lead a company into (and maybe out of) bankruptcy, asking employees to take a cut for the team and then giving hundreds of millions in bonuses?

Something seem screwed with this picture? Hopefully, bankruptcy court kicks them in the @ss but I doubt it.

:roll:
Click to expand...


Definatly NOT ok...
Execs still getting new Bentleys and the regular blue collar workers get laid off...
yah thats fair..
 
Their side is "We will lose people if we don;t pay..."

My side, those are the people that need to leave. You are goign broke and the company is being run very badly.


A lot of top people are getting mad at GM right now as they want teh workers to take a pay cut but not them. Last I checked it was not the workers job to keep the company running, its yours and right now it stinks. Now if the wheels on my Corvette fall off then yea we can talk about the workers. Until then shut up.
 
Originally posted by: CVSiN
Originally posted by: Engineer
Click me!

I thought bonuses were a "reward"...how is it rewarding to lead a company into (and maybe out of) bankruptcy, asking employees to take a cut for the team and then giving hundreds of millions in bonuses?

Something seem screwed with this picture? Hopefully, bankruptcy court kicks them in the @ss but I doubt it.

:roll:
Click to expand...



Definatly NOT ok...
Execs still getting new Bentleys and the regular blue collar workers get laid off...
yah thats fair..
Click to expand...

IMO, employees being laid off (while bad), isn't as bad as asking everyone to take a cut to survive and then giving yourself 8% of the company in bonuses after filing bankruptcy. Culture of greed...I guess.


 
Originally posted by: Viper GTS
I see no problem with fulfilling their contractual obligations.

Viper GTS
Click to expand...

Yet they are taking the worker unions to bankruptcy court to break their contracts. Why not let the bankruptcy court break the CEO/Exec. contracts to keep the company solvent? A little hyprocracy on the bankruptcy court, if you ask me.
 
That kind of thing drives me nuts. As a manager I despise bad management. If your company is profitable and growing, by all means, take your bonus. I even leave the door open to collect a binus if your company is losing money. (If your company is losing money BUT is losing much less than before you took over - because your policies and moves have stopped the bleeding - and things are looking up... by all means, take your bonus)

If your company is heading into bankruptcy and that path was taken while you were in charge, you can take your bonus and shove it up your a$$.
 
Originally posted by: Engineer
Originally posted by: Viper GTS
I see no problem with fulfilling their contractual obligations.

Viper GTS
Click to expand...

Yet they are taking the worker unions to bankruptcy court to break their contracts. Why not let the bankruptcy court break the CEO/Exec. contracts to keep the company solvent? A little hyprocracy on the bankruptcy court, if you ask me.
Click to expand...

Throwing a few million at good management will do far more for a company that's in trouble than spreading it out across their low level employees. Whether spreading it out means a small increase in pay for everyone or a few jobs retained makes no difference, it still doesn't have any hope of helping the company survive.

Viper GTS
 
Originally posted by: crystal
Sure why not. It is reward for their hard works that brough the company out of bankruptcy.
Click to expand...

Then where is the punishment for taking their company into bankruptcy to begin with?
 
Originally posted by: Viper GTS
Originally posted by: Engineer
Originally posted by: Viper GTS
I see no problem with fulfilling their contractual obligations.

Viper GTS
Click to expand...

Yet they are taking the worker unions to bankruptcy court to break their contracts. Why not let the bankruptcy court break the CEO/Exec. contracts to keep the company solvent? A little hyprocracy on the bankruptcy court, if you ask me.
Click to expand...

Throwing a few million at good management will do far more for a company that's in trouble than spreading it out across their low level employees. Whether spreading it out means a small increase in pay for everyone or a few jobs retained makes no difference, it still doesn't have any hope of helping the company survive.

Viper GTS
Click to expand...


Few million? 8% of company value. If the employees are expected to take a cut for the team, I think that the CEO/management should take the same cut for the team. Apparantely, it's the A Team and the B Team....everyone isn't a part of the same team and that's what's wrong with the whole picture.
 
Originally posted by: Engineer
Originally posted by: crystal
Sure why not. It is reward for their hard works that brough the company out of bankruptcy.
Click to expand...

Then where is the punishment for taking their company into bankruptcy to begin with?
Click to expand...

Are you sure there are no punishment for the last 3 years that the airline was in bankruptcy? Exec. contracts are different than normal workers like me. Bonus, stock options and comp are where they got most of their money (let say 2x-10x their base salary). During those 3 years, they got no bonus. From their point of view, they already take a 50% plus in paycut.
 
Originally posted by: Engineer
Originally posted by: Viper GTS
Originally posted by: Engineer
Originally posted by: Viper GTS
I see no problem with fulfilling their contractual obligations.

Viper GTS
Click to expand...

Yet they are taking the worker unions to bankruptcy court to break their contracts. Why not let the bankruptcy court break the CEO/Exec. contracts to keep the company solvent? A little hyprocracy on the bankruptcy court, if you ask me.
Click to expand...

Throwing a few million at good management will do far more for a company that's in trouble than spreading it out across their low level employees. Whether spreading it out means a small increase in pay for everyone or a few jobs retained makes no difference, it still doesn't have any hope of helping the company survive.

Viper GTS
Click to expand...


Few million? 8% of company value. If the employees are expected to take a cut for the team, I think that the CEO/management should take the same cut for the team. Apparantely, it's the A Team and the B Team....everyone isn't a part of the same team and that's what's wrong with the whole picture.
Click to expand...

They are not getting cash, they are getting stock (and stock options). The value of that stock (and options) will be directly related to the performance of the company, giving those ~400 people a great reason to make sure the company does well.

They aren't simply handing out 8% of the company.

Viper GTS
 
Originally posted by: Viper GTS
Originally posted by: Engineer

Then where is the punishment for taking their company into bankruptcy to begin with?
Click to expand...

The current CEO came on 3 months prior to them filing for bankruptcy. He was almost certainly brought on TO take them into (and out of) bankruptcy, he is not responsible for getting them to that point.

http://en.wikipedia.org/wiki/Glenn_Tilton

Viper GTS
Click to expand...

OK. So what about the other 400 managers? The employees took a 4.6 BILLION cut to keep it alive, but the management gets bonues for esentially getting those 4.6 billion in cuts through?

While I think that unions suck for the most part and have actually held back American buisness for the last 25 years, it's things like this that will lead to a resurgence of unions...and not just at airlines.

 
im two minds about it. One without good managment the business is going to fail. But when in bancruptcy takeing a %8 cut of the company is a little high.
 
Originally posted by: Viper GTS
Originally posted by: Engineer
Originally posted by: Viper GTS
Originally posted by: Engineer
Originally posted by: Viper GTS
I see no problem with fulfilling their contractual obligations.

Viper GTS
Click to expand...

Yet they are taking the worker unions to bankruptcy court to break their contracts. Why not let the bankruptcy court break the CEO/Exec. contracts to keep the company solvent? A little hyprocracy on the bankruptcy court, if you ask me.
Click to expand...

Throwing a few million at good management will do far more for a company that's in trouble than spreading it out across their low level employees. Whether spreading it out means a small increase in pay for everyone or a few jobs retained makes no difference, it still doesn't have any hope of helping the company survive.

Viper GTS
Click to expand...


Few million? 8% of company value. If the employees are expected to take a cut for the team, I think that the CEO/management should take the same cut for the team. Apparantely, it's the A Team and the B Team....everyone isn't a part of the same team and that's what's wrong with the whole picture.
Click to expand...

They are not getting cash, they are getting stock (and stock options).

They aren't simply handing out 8% of the company.

Viper GTS
Click to expand...


From the article...

Overall, United plans to set aside 8 percent of the equity it plans to issue ? at a value of around $152 million ? for about 400 salaried and management employees. The compensation awards were disclosed in UAL filings Wednesday with the court and elucidated by company spokeswoman Jean Medina.
Click to expand...


You might be right. It is 8% of the new stock issued. Regardless, I don't agree with the setup.
 
Well the problem with talented management is that they need an incentive to stay, especially top managers. Those that have the ability to turn a company around are few and far between.

No top end manager is going to take a high risk (ie lose job as well as reputation) if they cant get a justifiable reward in the end.

The perfect example is the old Gillette CEO he came in to turn the company around and he did it. Hes pretty famous for it actually done it with about 4-5 companies from my memory. Hes a turnaround king and has reaped the rewards from it.
 
Originally posted by: Engineer
You might be right. It is 8% of the new stock issued. Regardless, I don't agree with the setup.
Click to expand...

At the bottom of the article they have the full breakdown. Save for the CEO the bulk of this distribution is in restricted stock and options. Restricted stock means they're going to be stuck with it, if the company tanks their holding is worthless.

Also remember that the options are simply the right to buy stock at a set price - If the stock drops those options are worthless, if it goes up they only gain what the stock gained.

Viper GTS
 
Originally posted by: Engineer
Click me!

I thought bonuses were a "reward"...how is it rewarding to lead a company into (and maybe out of) bankruptcy, asking employees to take a cut for the team and then giving hundreds of millions in bonuses?

Something seem screwed with this picture? Hopefully, bankruptcy court kicks them in the @ss but I doubt it.

:roll:
Click to expand...

Topic Title: Should CEO's/Executives receive bonuses while in or filing for bankruptcy?
Topic Summary: United Airlines sets aside 152 million for 400 managers WHILE in bankruptcy...

Sweet, America the beautiful :thumbsup:
 
Originally posted by: dmcowen674

Topic Title: Should CEO's/Executives receive bonuses while in or filing for bankruptcy?
Topic Summary: United Airlines sets aside 152 million for 400 managers WHILE in bankruptcy...

Sweet, America the beautiful :thumbsup:
Click to expand...

Your mindless capitalism bashing and class envy is growing old. You have no legitimate support for anything you say, yet you post links to articles you don't understand and pop into threads like this to bash something you're not equipped to be part of.

Unless you can comprehend what is going on in this thread, please STFU.

Viper GTS
 
Fortune 500 executives are a rare commodity. If you don't offer bonus incentives to management, who's going to stay to run the company? The union leaders?

Most people here are so ignorant as to how complicated it is to run a multi-billion dollar company. They are so quick to blame management for a company's demise but rarely implicate the unions that run companies to the ground.
 
I don't see anything wrong with it. It is how business works.

The execs need incentive to stay and being tied to stock means it is directly related to company performance.
 
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