CORPORATE AMERICANS WAR ON THE AMERICAN PEOPLE - Hey, It's Only Business!

CORPORATE AMERICA’S WAR ON THE AMERICAN PEOPLE!


CEOs who cut jobs got paid more, study says
Tom Abate, Chronicle Staff Writer
Wednesday, September 1, 2010


The CEOs who cut the most jobs during the recession earned more than their peers, according to a study being released today by a liberal think tank in Washington.
"When CEOs slash jobs they are often very richly rewarded," said Sarah Anderson, lead author of the Institute for Policy Studies' report, "CEO Pay and the Great Recession."
Separately, the report estimated that the CEOs of the nation's largest publicly traded companies make an average of 263 times more the typical U.S. production worker.
The institute used the Forbes.com layoff tracker to identify the 50 firms that laid off the most employees between November 2008 and April 2010. It then used the Associated Press online survey and company financial reports to arrive at 2009 compensation totals.
The institute calculated that the 50 CEOs - who together cut 531,363 jobs - averaged $12 million in salary, bonuses, stock options and other perks, 42 percent more than the average compensation for all of the CEOs on the Standard & Poor's 500.
The report said 7 out of 10 of these top job-cutters laid off workers even though their companies ended the year profitably.
Bay Area firms
The list included Mark Hurd, who recently resigned from Hewlett-Packard Co. in the wake of a sexual harassment investigation, and Intel Corp. chief executive Paul Otellini, each of whom trimmed 5,000 jobs during the period under study.
The institute said Hurd earned $24.2 million in 2009, while Otellini received $14.4 million in compensation.
HP declined to comment, but Intel spokesman Chuck Mulloy said there was no connection between his boss' pay and the job cuts and that Otellini was evaluated on the same criteria as any other Intel employee.
"The layoffs we did were primarily as a result of closing older manufacturing sites in China, Malaysia and the Philippines," he said.
But Intel shed about 450 jobs locally when it closed its last Silicon Valley chip fabrication plant last year, he said.
Charles Elson, director of the Center for Corporate Governance at the University of Delaware, characterized the study as a cheap shot.
"I am a significant critic of CEO pay, but I've never believed there is a linkage between layoffs and CEO pay," he said.
Pay for performance
Elson said the best way to keep CEO pay in line with performance is to make sure that corporate boards include shareholders with large stakes in the company.
He also pooh-poohed the notion that a ratio between CEO and rank-and-file pay had any relevance to corporate governance.
But such ratios could soon become common. The institute said that, under the newly passed financial reform package, publicly traded firms will be required to compute their median pay and the ratio between that figure and CEO compensation.
Hurd
$24.2 million
cut 5,000 jobs
Otellini
$14.4 million
cut 5,000 jobs