Blog of Parag

Bonuses for Delphi execs

Delphi Corp., a major car part supplier announced bankruptcy last week. The CEO announced that they want to emerge as a lean and mean company after going through bankruptcy process. On top of massive job cuts and factory closures, they propose to cut the salaries for hourly workers by half and benefits will be cut, too.

At the same time, top 486 executives will receive bonuses (30%-250% of their salary depending on their place in the organisation) amounting to almost $88 million. President Rodney O'Neal would get a total cash bonus of $2.75 million, based on a $1.15 million average salary.

These are the same executives/managers, through their decision-making brought the company to bankruptcy. Does the company really need the same bunch of bozos to run it again?

On the other hand, don't they feel obligated to stay on and get the company through tough time? Where is their integrity and sense of responsibility? Why is any incentive required to keep them around?

In this kind of (greedy) corporate environment, one has to appreciate people like Steve Jobs. When he came back to Apple, the company was in trouble. He salary as CEO was $1 per year. He had a boatload of options, but, they would have been worthless, if he hadn't engineered a turn-around for the company.

The greedy execs of Delphi want to get paid for the mess they created and want to get paid even more for cleaning it up. Such is corporate America.

All the factual information is taken from this article.