Chordiant grants special bonuses to execs a month after cutting workforce 13 percent
We continue to be fascinated by the mixed messages sent out by companies that are laying off employees at the same time they are giving more money to executives to convince them not to leave.
Is there some increased need for managers that works inversely to the number of employees left to manage?
Chordiant Software, the Cupertino company that last month slashed the forecast for its fiscal fourth quarter by a third and said it would lay off 33 employees, or about 13 percent of its work force, said to day in a filing that its board approved payment of “special cash bonuses for outstanding performance during the 2008 fiscal year,” and as a “retentive tool.”
This begs the question, of course, doesn’t the company already have a bonus plan set up to reward outstanding performance, based on pre-established metrics?
Chordiant’s chief executive, Steven Springsteel, is set to get an extra $100,000 distributed over the course of the next four quarters. At least he won’t be getting a raise next year but will have to make do with the same $550,000 salary he was paid this past year.
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Not only did they give themselves these cash bonuses, they also gave themselves stock options in October 2008. In addition, they gave themselves restricted stock on November 19th, 2008, over 500,000 shares. These executives will earn more in bonuses in 2009 than the shareholders will in income. Unconscionable!
Those people should be happy to be liberated. I’m sure they’ll get some cash as well.