Posted on 08/27/2003 5:47:46 AM PDT by dogbyte12
Delta Air Lines, Northwest Airlines and Continental Airlines gave their chief executives raises after the Sept. 11, 2001, terrorist attacks even as they laid off a total of 33,000 workers, according to a study by two nonprofit groups.
The attacks cost the industry as much as $2 billion in lost business, according to a Washington University study. As revenue plunged and Continental's Gordon Bethune, Delta's Leo Mullin and Northwest's Richard Anderson cut jobs, they received raises of $1.2 million to $3.4 million, the study by the Institute for Policy Studies and United For a Fair Economy found.
The trend underscores the increasing focus of chief executives on meeting profit targets to the detriment of workers, and a growing gap between executive and worker pay, according to the study's authors.
"CEOs ought to be judged on a broader definition of performance, one that includes how they treat workers as well as the [profit] numbers," said Sarah Anderson, director of the Washington, D.C.-based Institute for Policy Studies' global economy project.
The average chief executive now makes 282 times the average worker, the study said. "In 1982 the ratio of CEO pay to worker pay was 42 to 1," Anderson said.
The study calculated that the 2002 compensation package for Delta's Mullin, including salary, bonus, restricted stock, long-term incentives, tax payments and exercised options, was almost $4.7 million, a 115 percent rise from 2001. Delta announced 17,000 layoffs in 2001, the study said.
Peggy Estes, a spokeswoman for Delta, said it would be inappropriate to comment without reviewing the study.
"The Delta episode shows how out of touch the corner office is with the lives of employees," said Scott Klinger, corporate accountability coordinator for Boston-based United For A Fair Economy, an advocacy group.
Continental chief executive Bethune received an 82 percent salary increase to $7.6 million in 2002, including exercised options, according to the study. Continental spokesman Ned Walker said the airline had 4,000 employees take early retirement and 4,000 involuntary layoffs. "While the layoffs were extremely painful, Continental never asked employees for wage cuts or concessions," Walker said.
Northwest chief executive Anderson received a 76 percent increase in pay last year to almost $2.8 million. Kurt Ebenhoch, a company spokesman, said the airline had about 7,783 layoffs in 2001.
"No industry was as hard hit by September 11 as the airline industry," he said, declining to comment on the report.
The two largest U.S. airlines, American and United, were not in the study because the chief executives at both companies had been replaced, Klinger said.
It's nobody's business what the CEO is making except that of the shareholders and the board of directors. If you do not approve of a company's executive compensation, don't invest in the company, and/or don't patronize them.
One can make the argument that these (or any) companies didn't deserve a taxpayer bailout, but you can't sit back and dictate how a company does business.
Yes, it's nobody's business but the shareholders. However, shareholders should be ticked. Executive boards have turned into different CEO's giving each other pay raises.
HP for example shed several thousand jobs, and lost 15% in valuation, and the CEO got a 231% pay raise.
I would love for people to bitch as much about the Union of CEO's as much as labor unions. I am not referring to people who build their own companies. I am talking about hired employees. CEO's for these companies are laborers too. They just wear suits. If you are a retail employee for a chain, and your sales go down 15%, you aren't given a 231% pay raise. The people who get screwed are the small time investors, who have no power in decisions of executive compensation packages.
You are a long term investor in a company, but ya only own $50,000 worth of stock, what say do you have, when a hired gun is given stock options that expire, and they decide to damage the company long term, by dumping critical workers, in order to make a quick buck, on short term inflated earnings that they can pocket. If they get fired, oh well. They are set.
Oh yes, one should never question greed, should one? Blackbird.
They are absolutely free to do so. But I get so pissed off when everybody always blames the workers when we outsource. Ya think that when ya look at say Jack Welch's compensation package at GE, which included things like $2,500 hand painted shower curtains that his wife just had to have, at the Manhattan penthouse the company let him live in, then ya start dumping employees, and outsourcing, it is madness.
If CEO salary wasn't 282 times worker salary, how much more efficient would these companies be, and able to retain their workers? Is there not a CEO who is willing to say, I will take 100 times worker salary, and pass on the rest, in order to keep my workers employeed? Where is the freaking loyalty?
I Wonder if you feel the same about everyone including unionized workers...just wondering.
I'm not sure I understand your question, but if you are wondering if I think it's my business what a union worker makes, I don't. I certainly have opinions on union wages and make every attempt to give my dollars to companies that fit my beliefs, but I also understand that's not always possible.
As far as I'm concerned, someone's personal income is their own business. Again, unless I have a stake in it, as an employer, owner, etc.
CEO bump.
Why? Are those companies and CEOs the part of the society or not?
What if the employees own stock in the company? Also any company trying to get federal bailout money should have to reveal what they're paying the crooks at the top. These guys are running companies into the ground, losing all kinds of money for the stockholders but they're making out like bandits.
Well, YOU are a part of society. Is it my business how much you make? Should I have some sort of input as to how much your employer compensates you, or the benefits you receive? What an absurd notion.
Well, I suppose they would be covered by the term "shareholders". That word was even in my statement you excerpted.
Listen, I've already conceded that the bailout situation moots the point in this instance. But the idea, generally, that executive compensation is a public issue is wrong. Some people here can't get over the fact that some people are extremely wealthy, and can even get that way through very little work. If it's not coming out of your wallet, it's none of your business.
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