Walmart US CEO Gets A $1.5 Million Bonus For Missing Expectations While A Worker Gets $0

[xchrom]

http://thinkprogress.org/economy/2014/05/12/3436808/walmart-executive-pay/



The New York Times reports that Walmart US CEO William Simon’s contract gave him the opportunity to earn a $1.5 million bonus last year on top of $10 million in salary and stock awards if the company’s American net sales grew by 2 percent. But net sales grew only 1.8 percent last year and Simon still received his bonus. That’s because Walmart calculated an “adjusted” sales growth over 2 percent that “corrected” for a series of factors that it said were beyond Simon’s control. Similarly, the company’s proxy statement reveals that executives would still receive a cash incentive even if the company’s total operating income declined by 1.5 percent.

Simon’s “performance pay” can be compared to the pay structure for Walmart associates revealed in an internal document last year. It lays out the hourly wage bonus that associates receive based on five different levels of performance. After calculating the annualized bonus associates receive if they work 52 40-hour weeks per year, it’s clear that Walmart doesn’t use the same pay structure for its executives that it uses for its associates. An associate who is graded “below expectations” or “needs improvement” won’t get any extra pay. A “solid performer” will receive $832, “exceeds expectations” nets $1,040, and a “role model,” the highest grade, is awarded $1,248. This means an associate can get an 8 percent bonus over the minimum wage when she is a role model, and a CEO can still get an 11 percent bonus when he misses his objectives.

Simon’s pay package also undermines the logic behind trickle-down economics. Thomas Piketty’s bestseller Capital in the Twenty-First Century finds that one of the main drivers behind growing inequality is surging executive pay. Defenders of inequality like to argue that growing executive helps the economy by providing incentives for them to work hard and grow their companies—growth that trickles down to the rest of us.

George W Bush’s former chief economist, for example, writes that “the most natural explanation of high CEO pay is that the value of a good CEO is extraordinarily high.” The Heritage Foundation goes a step further, warning that reducing CEO pay by raising taxes would damage the economy because it “would reduce the incentives for high-earners to work and take risk, which would reduce opportunity for lower-income workers because it would result in less job creation.”

[reformist2]

1. Executive pay is often more like winning a lottery than it is tied to actual productive work.

A rigged, crooked, cronyistic* and nepotistic* lottery, I might add.

* those probably aren't actually words, but I don't care.

[yeoman6987]

2. Don't bonus' for workers at Walmart come out in December?

When I worked there, I am pretty sure that we got a weeks pay for a bonus but not until December which is pretty nice timing. I guess getting it in the Summer would work towards a vacation but December is perfect.

[raccoon]

3. This sucks, but seems to be SOP. Off to greatest with you! nt

[progressoid]

4. That deserves a meeting with the President.

[1StrongBlackMan]

13. The President of "Walmart"? ...

The President of the Board of directors? The president of a shareholder's organization?

Because there is nothing the POTUS can, or should do about corporate compensation of its executives.

[HughBeaumont]

5. Leave it up to Heritage and a former Bewsh person to justify the CEO Larceny Cult.

Again I ask . . . WHAT "RISK"? There's no "risk" going in or coming out. They get that fucking money whether they do a good or bad job! That's in their contract, designed and approved by fellow boardmembers (who are also all executives and CEOs) and constructed and protected by corporate attorneys.

[Starry Messenger]

6. K&R

[freebrew]

7. And the CEOs 'grow' thier company by outsourcing jobs.

and by 'grow' I mean for the shareholders(great americans*), not the employees(lazy hacks) that actually produce things.


* - americans now include foreign investors in US companies.

[DallasNE]

8. Walmart Set The Bar Low At 2% Of Net Sales

Then say it is unfair to use all cost of sales in the net calculation allowing the CEO can get over the low bar. Funny how excuses are never allowed when hourly workers are involved and the bar is never set that low in the first place.

[Octafish]

9. Why do you hate America rewarding success?

One nation under Walmart.

http://www.democraticunderground.com/discuss/duboard.php?az=show_mesg&forum=389&topic_id=4630396&mesg_id=4631257

Jackson Stephens really loved that Rose Law Firm.

[RufusTFirefly]

10. Sshhh! It's no longer permissible to say bad things about Walmart

Didn't you get the memo, xchrom? Or are you simply a closet Republican on Karl Rove's payroll?

Since the President paid a high-profile visit there, we feel compelled to re-evaluate our views of that iconic emporium.
Maybe Walmart's not so bad after all?

Same goes for fracking, now that Vice President Biden has been trying to convince them to use it in the Ukraine.

[Fearless]

11. "The table is tilted folks. The game is rigged..."

"And no one seems to notice, no one seems to care...

[daleanime]

12. K&R....

[Initech]

14. So these CEOs do nothing, make $2 million a year, while we do all the work and make nothing?

Our economic system is terribly, terribly broken.

[blkmusclmachine]

15. Savvy!

[heaven05]

16. this is an

example of capitalism run amok. Our oligarchy is enhancing the wealth of those who don't need and denying the many with starvation wages. This is obscene! How can this be seen as american exceptionalism? How can this be an example of pull yourself up by your bootstraps? What a bullshit lie this capitalist system perpetuates.

[Elmergantry]

17. So the Wal-Mart CEO is making his millions at the expense of the lowly workers.

Wal-Mart has what, 2 million employees? Just for the sake of discussion lets say 1 million of them are your typical low paid, part time employees. Probably more than that, but lets run with it. We ought to take that 10 million the CEO gets and give it to the workers. That will solve the income inequality issue fer sure!...So lets see do, the math.....10 million divided between 1 million workers, carry the one, divided by pi, round up...take the square root..hmm that equates to $10 each employee total per year... Cool, income inequality problem solved!

[Yo_Mama_Been_Loggin]

18. GOP logic

Let's give the CEOs obscene wages else they won't work as hard but let's not pay a livable wage to workers because that will make them lazy.

[951-Riverside]

19. We should force companies to share 70%-80% of its profits with employees.

And all executive pay for corporations with 50 or more employees should be capped at $200,000.