Current Events > Bankrupt Sears wants to give executives $19 million in bonuses

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https://www.cnn.com/2018/11/16/business/sears-executive-bonuses

Sears is seeking court approval to pay executives as much as $19 million in quarterly bonuses while the company struggles to restructure in bankruptcy.

Three top executives could get nearly $1 million each if the company goes out of business. If Sears remains in business, they could get nearly $500,000 each for hitting the top performance targets.

Sears filed two different types of bonus plans in bankruptcy court Thursday. The first is for the top 18 "key" executives, who would collectively get as much as $2.1 million per quarter. The bonuses would only be paid in full if Sears reaches its cash-flow targets. Sears Holdings, which includes both Sears and Kmart, has been burning through cash at a rate of about $125 million a month.

A second retention bonus plan was designed to encourage 322 other unnamed executives to stay put during Sears' reorganization. They would collectively get $16.9 million a quarter, which works out to an average of about $52,000 per quarter per executive. No executive could receive more the $150,000 in bonuses for staying with the company during the bankruptcy process.

A judge's approval is needed before the bonuses could be paid. A hearing on the plans is set for December 20.

The company wants to retain as many executives as it can, but Sears is laying off employees who staffed hundreds of stores it is closing. Many hourly workers claim they will not be paid severance.

Shelia Brewer, who worked for 17 years as a full-time hourly employee at a Kmart in Rockford Illinois, said the company told her she'd get eight weeks of severance. Instead, she received a letter saying that severance payments were being halted because of the bankruptcy, and she would get only the four weeks of pay she had already received.

"It hit me hard. I was already struggling as it was," she said. She said the bonus plan makes her angry.

"They say we can't get our severance because there's no money, but they're getting bonuses? It's like a slap in the face," she said.

A Sears spokesman declined to comment on the bonus plan or its current severance policy.
Eddie Lampert, the company's primary shareholder and chairman, apparently will not receive a bonus, according to the filing.

The three top executives who were given the responsibility for running the company during its reorganization are in position for the largest bonuses. They are Chief Financial Officer Robert Riecker, Chief Digital Officer Leena Munjal and Gregory Ladley, president of the company's clothing and footwear business.

Each could receive as much as $240,000 a quarter in bonus payments for hitting the maximum cash flow targets. They could receive four times that much if Sears goes out of business, in something the company called an "acceleration event."

Retention bonuses for top executives are not unusual when companies go bankrupt. But bankruptcy law limits how much severance companies can pay.

Toys "R" Us won approval for up to $16 million in bonuses for 17 top executives a year ago during its failed attempt to stay in business, despite objections from employees groups and others.

"It's outrageous that the bankruptcy court is considering bonuses for Sears' high paid executives while laid off employees get their severance pay cut off," said Carrie Gleason, campaign manager for Rise Up Retail, a retail employee advocacy group. "This is exactly what happened at Toys 'R' Us. A handful of executives who couldn't save the company got millions in bonuses while tens of thousands of dedicated employees were denied their promised severance pay."

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#America
#NotRacistSoItsOk
#FakeStupidHashTagGimmick
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"here's some money for sucking!"
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Joke company
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I don't understand why you'd want to give millions of dollars to the people who bankrupted your company
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I mean that's fine but they will go out of business even faster

Sears used to be great too
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spudger posted...

"here's some money for sucking!"

Worlds oldest profession.
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Bob Vila is turning over in his grave.
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Reminds me of frank from always sunny

You drive the business into the ground, and you wanna talk bonuses?!
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So basically, they're doing the same unethical shit every single large company that goes bankrupt does.
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Tyranthraxus posted...

I don't understand why you'd want to give millions of dollars to the people who bankrupted your company

Now I could be wrong, but I'm pretty sure the people receiving the money are the same people in charge of giving it out.
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CE should run Sears
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JustMyOpinion posted...

The idea is that if you want them to stay on a sinking ship you gotta pay them. Even if they do suck, they're still better than the alternative of them leaving and no one wanting to come into this trainwreck. The company has value even in bankruptcy and someone has to run it.

There's nothing to stop them from leaving though. You can't mandate that they work for you
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Damn_Underscore posted...

CE should run Sears

First order of business, we chance the name to CEars
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GG capitalism.
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Tyranthraxus posted...

Damn_Underscore posted...

CE should run Sears

First order of business, we chance the name to CEars

Im on the phone with the president, stock just skyrocketed.
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Zack_Attackv1 posted...

Bob Vila is turning over in his grave.

He isn't dead
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Tyranthraxus posted...

Damn_Underscore posted...

CE should run Sears

First order of business, we chance the name to CEars

^^^

Hope theres a rewards card
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This is the same corrupt, greedy shit that Hostess pulled when they went under. Folks then had the gall to blame unions for destroying the company.

Hold these scummy fuckers accountable. They'll lay off thousands of workers and close hundreds of stores, but it doesn't matter as long as they get to bleed the withering husk of their company dry one last time. It's disgusting.

This is why people unironically gather behind slogans like "eat the rich" or who make a point to talk shit on "the 1%".

Edit: Though I will say, the second plan seems a lot more tame than 18 "key" executives getting a million bucks a quarter. Keep more people employed, don't overpay the brass.
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CEars commercial:

I cannot live another day without internet
Yesterday you said you'd go outside
I'll go out today
You'll go out now
I'll go out now

Leave your parents' basement today and visit your local CEars
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Lordgold666 posted...

Tyranthraxus posted...

Damn_Underscore posted...

CE should run Sears

First order of business, we chance the name to CEars

^^^

Hope theres a rewards card

1% of all purchases added to gamefaqs karma.
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Damn_Underscore posted...

CEars commercial:

I cannot live another day without internet
Yesterday you said you'd go outside
I'll go out today
You'll go out now
I'll go out now

Leave your parents' basement today and visit your local CEars

Wow. How old is that commercial?
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This happened at Hostess and they blamed the union even though they took concessions multiple times.
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Damn_Underscore posted...

CEars commercial:

I cannot live another day without internet
Yesterday you said you'd go outside
I'll go out today
You'll go out now
I'll go out now

Leave your parents' basement today and visit your local CEars

https://www.youtube.com/watch?v=4rqZZgVxnCk" data-time="
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