How Many Workers Can You Hire for the Price of One CEO?

[AANOTOK]

http://www.dailyfinance.com/story/how-many-workers-can-you-hire-for-the-price-of-one-ceo/19540733/?utm_source=feedburner&utm_medium=feed&utm_campaign=Feed%3A+businessinsider+%28Business+Insider%29

AMR (American Airlines, Inc.) (AMR)
Gerard J. Arpey: $5.6 million (2009 Compensation)
Entry-level Flight Attendant, flying minimum domestic hours: $20.24/hour, $21,252/year
One CEO = 263 entry-level employees

 

[Imjustsayin]

Wow, does that include the amr president's stock and things like that?

 

[JAFA]

I just isn't much at all. We all like to get ourselves worked up over what he makes and then doubt he's really underpaid. I guess a little comparison is in order here.

Robert Iger - Disney CEO

Compensation for 2009
Salary $2,038,462.00
Bonus $0.00
Restricted stock awards $6,336,509.00
All other compensation $741,601.00
Option awards $ $8,308,647.00
Non-equity incentive plan compensation $9,260,000.00
Change in pension value and nonqualified deferred compensation earnings $2,343,143.00
Total Compensation $29,028,362.00

Jay Fishman - Travelers CEO

Compensation for 2009
Salary $1,000,000.00
Bonus $0.00
Restricted stock awards $3,750,013.00
All other compensation $724,124.00
Option awards $ $7,128,696.00
Non-equity incentive plan compensation $7,500,000.00
Change in pension value and nonqualified deferred compensation earnings $526,136.00
Total Compensation $20,628,969.00

William Swanson - CEO Raytheon

Compensation for 2009
Salary $1,297,920.00
Bonus $0.00
Restricted stock awards $10,353,257.00
All other compensation $402,445.00
Option awards $ $0.00
Non-equity incentive plan compensation $3,050,000.00
Change in pension value and nonqualified deferred compensation earnings $3,533,250.00
Total Compensation $18,636,872.00

Samuel Palmisano - CEO IBM

Compensation for 2009
Salary $1,800,000.00
Bonus $0.00
Restricted stock awards $13,517,401.00
All other compensation $1,091,888.00
Option awards $ $0.00
Non-equity incentive plan compensation $4,750,000.00
Change in pension value and nonqualified deferred compensation earnings $3,154,506.00
Total Compensation $24,313,795.00

Leslie Moonvies - CEO CBS

Compensation for 2009
Salary $3,513,462.00
Bonus $15,000,000.00
Restricted stock awards $7,599,997.00
All other compensation $2,522,792.00
Option awards $ $14,339,265.00
Non-equity incentive plan compensation $0.00
Change in pension value and nonqualified deferred compensation earnings $263,359.00
Total Compensation $43,238,875.00

David Novak - CEO Yum Brands

Compensation for 2009
Salary $1,400,000.00
Bonus $0.00
Restricted stock awards $739,989.00
All other compensation $239,455.00
Option awards $ $4,192,111.00
Non-equity incentive plan compensation $2,993,760.00
Change in pension value and nonqualified deferred compensation earnings $3,565,977.00
Total Compensation $13,131,292.00

and finally....

Gerard Arpey - CEO AMR Corp

Compensation for 2009
Salary $669,646.00
Bonus $0.00
Restricted stock awards $2,994,330.00
All other compensation $100,593.00
Option awards $ $957,580.00
Non-equity incentive plan compensation $583.00
Change in pension value and nonqualified deferred compensation earnings $908,270.00
Total Compensation $5,631,002.00 - ranked 371 in executive compensation for 2010

now maybe we can worry about our own incomes instead of the CEO's

 

[eolesen]

Another fact omitted from their calculations.... benefits load. I'm sure the number for AMR would fall once you start adding in what AMR offers in terms of health care & retirement (which despite all the negativity you here is still better than what a lot of employers in the US offer)

 

[Hopeful]

Another fact omitted from their calculations.... benefits load. I'm sure the number for AMR would fall once you start adding in what AMR offers in terms of health care & retirement (which despite all the negativity you here is still better than what a lot of employers in the US offer)

You know what the negativity is about? It is about most of us years and decades ago having been told and, yes, PROMISED, certain conditions when we hired on. We were told "these are your benefits", "Give us so many years of loyal employment, and this is what your pension will be"....etc. etc etc."

And each and every time during a economic/company downturn, they came to the employees and took things from us.
And they are still doing just that.
So, defend how you will the "POOR EXECUTIVE" argument, their loyalty is in themselves.
And criticize how you will union people just "staying" around because of their seniority.

I see more employees with greater AA time than just about any executive. The average AA employee is wAAy more loyal than your average executive.

And yes, AMR does offer better health care and retirement than a lot of employers in the US.....
The difference is, just as we were told and promised decades ago what our benefits are, new hires at other companies are being told and promised what their benefits and health care are....

And before you reply with "well, market conditions are forever changing,"
I will respectfully remind you what we have given back over the years.

And guess what else?
AA will become one of these "other" companies if this TA is approved.
No pension and nothing special benefits.

 

[eolesen]

I see more employees with greater AA time than just about any executive. The average AA employee is wAAy more loyal than your average executive.

Then you're not looking very hard..... Sure, there have been execs who have left. A couple came back. On average, though, most appear to have spent their entire professional career at AMR.

There are only three I can think of with less than 10 years of actual company seniority -- Jeff Brundage, Admiral Cleveland & Monte Ford.

Finance, Legal, Airport Ops, Flight, Flight Service, Purchasing?.... all 20+ years. Some with 25 to 30 years. You won't find too many 40 year VP's because most of them retired in the years after Crandall did.

There might be a few VP's in Maintenance and IT who were hired from outside. But that's the exception, and as you guys like to point out, the Romano era maintenance leadership was worthless and replacing from outside was probably the right thing.

There's a lot about the current management team to criticize, but length of service & loyalty aren't on that list.

 

[Hopeful]

Then you're not looking very hard..... Sure, there have been execs who have left. A couple came back. On average, though, most appear to have spent their entire professional career at AMR.

There are only three I can think of with less than 10 years of actual company seniority -- Jeff Brundage, Admiral Cleveland & Monte Ford.

Finance, Legal, Airport Ops, Flight, Flight Service, Purchasing?.... all 20+ years. Some with 25 to 30 years. You won't find too many 40 year VP's because most of them retired in the years after Crandall did.

There might be a few VP's in Maintenance and IT who were hired from outside. But that's the exception, and as you guys like to point out, the Romano era maintenance leadership was worthless and replacing from outside was probably the right thing.

There's a lot about the current management team to criticize, but length of service & loyalty aren't on that list.

Don't forget former maintenance VPs who came from other defunct airlines and moved on to greener pastures.There may not be any 40+ years execs left, but there are quite a few 40+ year mechanics still around. Even a few 50+ left.
Let's not forget that most executives don't have to stay around until they are in their 70s and near 80s. Thir upper class status affords them to retire at a more comfortable 60s age.
How much credit was Carty given for his tenure at AA?

Hands down, at least in M&E, there are mechanics who have spanned just about every advancement in aviation.

And by loyalty, I mean we don't just up and quit or "threaten" to leave unless we get better pay and benefits.
We stay on the job and fight for something.

And at JFK, we have one mechanic, Al Blackman, who wrote the book on loyalty.

And the thanks he gets once a year on his anniversary has been reduced to practically a piece of cake and few kind words.

 

[DNTULSA]

I just isn't much at all. We all like to get ourselves worked up over what he makes and then doubt he's really underpaid. I guess a little comparison is in order here.

Robert Iger - Disney CEO

Compensation for 2009
Salary $2,038,462.00
Bonus $0.00
Restricted stock awards $6,336,509.00
All other compensation $741,601.00
Option awards $ $8,308,647.00
Non-equity incentive plan compensation $9,260,000.00
Change in pension value and nonqualified deferred compensation earnings $2,343,143.00
Total Compensation $29,028,362.00

Jay Fishman - Travelers CEO

Compensation for 2009
Salary $1,000,000.00
Bonus $0.00
Restricted stock awards $3,750,013.00
All other compensation $724,124.00
Option awards $ $7,128,696.00
Non-equity incentive plan compensation $7,500,000.00
Change in pension value and nonqualified deferred compensation earnings $526,136.00
Total Compensation $20,628,969.00

William Swanson - CEO Raytheon

Compensation for 2009
Salary $1,297,920.00
Bonus $0.00
Restricted stock awards $10,353,257.00
All other compensation $402,445.00
Option awards $ $0.00
Non-equity incentive plan compensation $3,050,000.00
Change in pension value and nonqualified deferred compensation earnings $3,533,250.00
Total Compensation $18,636,872.00

Samuel Palmisano - CEO IBM

Compensation for 2009
Salary $1,800,000.00
Bonus $0.00
Restricted stock awards $13,517,401.00
All other compensation $1,091,888.00
Option awards $ $0.00
Non-equity incentive plan compensation $4,750,000.00
Change in pension value and nonqualified deferred compensation earnings $3,154,506.00
Total Compensation $24,313,795.00

Leslie Moonvies - CEO CBS

Compensation for 2009
Salary $3,513,462.00
Bonus $15,000,000.00
Restricted stock awards $7,599,997.00
All other compensation $2,522,792.00
Option awards $ $14,339,265.00
Non-equity incentive plan compensation $0.00
Change in pension value and nonqualified deferred compensation earnings $263,359.00
Total Compensation $43,238,875.00

David Novak - CEO Yum Brands

Compensation for 2009
Salary $1,400,000.00
Bonus $0.00
Restricted stock awards $739,989.00
All other compensation $239,455.00
Option awards $ $4,192,111.00
Non-equity incentive plan compensation $2,993,760.00
Change in pension value and nonqualified deferred compensation earnings $3,565,977.00
Total Compensation $13,131,292.00

and finally....

Gerard Arpey - CEO AMR Corp

Compensation for 2009
Salary $669,646.00
Bonus $0.00
Restricted stock awards $2,994,330.00
All other compensation $100,593.00
Option awards $ $957,580.00
Non-equity incentive plan compensation $583.00
Change in pension value and nonqualified deferred compensation earnings $908,270.00
Total Compensation $5,631,002.00 - ranked 371 in executive compensation for 2010

now maybe we can worry about our own incomes instead of the CEO's

I wonder if the above companies are profitable?

AA certainly isn't.

 

[eolesen]

I wonder if the above companies are profitable?

AA certainly isn't.

Sure, they're profitable. Some of them grossly profitable. But they also work in areas with very little government oversight, and a lot more day to day control over the environment they do business in.

With Arpey ranked at 371st in exec compensation, I'm willing to bet that there people in positions 370 and higher leading unprofitable enterprises, and some of them grossly unprofitable.

 

[FWAAA]

I've said it before and I'll say it again: Executives get paid (get paid a lot) no matter how profitable a company is. When the company is profitable, then executives get paid a lot more money than when not profitable.

If AMR was the only airline with massive losses over the past decade, then I'd blame Arpey and other AA management.

But instead, every network legacy has lost billions over the past decade (including UA, DL, NW, CO and US in addtion to AA). The odds that the executives of all those airlines have been bumbling idiots over the same time frame are astronomical - enough for me to believe that they've done what they could against perfect storm after perfect storm.

I'll criticize Arpey's pay (in the face of big losses) the day the other network legacies report big profits compared to AMR's big loss.

The board of AMR disclosed in the Proxy Statement that Arpey will be paid about $4 million to $5 million even if AA turns in lackluster results. Just for staying the course. If AA turns in spectacular profits, he'll be paid many millions more.

The OP's article paints Arpey and AMR in a fairly positive light, all things considered.

 

[Hopeful]

I've said it before and I'll say it again: Executives get paid (get paid a lot) no matter how profitable a company is. When the company is profitable, then executives get paid a lot more money than when not profitable.

And I've said it before and I'll say it again.....I don't nor have i cared what an executive made....They just exempted themselves from the "shared" pain.

 

[FrequentFlierCA]

And I've said it before and I'll say it again.....I don't nor have i cared what an executive made....They just exempted themselves from the "shared" pain.

I think that depends how you define shared pain. It's certainly hard to cry over execs making hundreds of thousands or millions of dollars. But when you look at that compared to what they could have made if there weren't any pay cuts, they have taken a hit, too. It's not nearly as noticeable because they make a lot more money, but compared to senior managers in other industries they are at a significant disadvantage and would be better off leaving the airline industry from a purely compensation point of view.

Again, not expecting anyone to cry over the fact that AMR's senior execs made hundreds of thousands less than they could have, but it's a perspective to consider.

 

[Rogallo]

I think that depends how you define shared pain.

That depends of what the definition of is is. Nice response Bill.

 

[Hopeful]

I think that depends how you define shared pain. It's certainly hard to cry over execs making hundreds of thousands or millions of dollars. But when you look at that compared to what they could have made if there weren't any pay cuts, they have taken a hit, too. It's not nearly as noticeable because they make a lot more money, but compared to senior managers in other industries they are at a significant disadvantage and would be better off leaving the airline industry from a purely compensation point of view.

Again, not expecting anyone to cry over the fact that AMR's senior execs made hundreds of thousands less than they could have, but it's a perspective to consider.

Wouldve couldve shouldve of.....This company played on the fears of all employees and not just union mechanics.

People making way less than me were force fed concessions too. This company instilled fear and concessions into those who could ill afford a paycut.

The fact of life is an executive making, say, $250,000 a year taking a 10% paycut is NOTHING compared to an employee making $35,000 a year and taking a 10% paycut.

His/her $25,000 a year paycut means that he/she just has to get a lower Mercedes Benz model.

You like to use the logic that AA execs could make so much more if they went else where. Maybe it is not dedication and loyalty that keeps them at AA, but rather the fact that other companies just plain do not want an AA exec.

 

[frontline]

I remember 2003 very well. The fear and possibility of bankruptcy were all too real. It was not management trying to pull a scam on us, they were practically on the courthouse steps. Don't ask how I know, but I do. Our concessions literally saved AMR from Bankruptcy.

$250K sure sounds like a lot, but it all depends what your expenses are. People at that level tend to be older, more established, have children in college, big mortgage, etc. Not justifying it, but the point is that it is all a matter of perspective. It is too easy to say they didn't take a hit. They did.