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(Chicago Trib)   American Airlines ordered to justify the $20 million severance given to their CEO. "Because he asked for it" apparently wasn't a good enough explanation   (chicagotribune.com) divider line 216
    More: Followup, American Airlines, executive directors, Americans, AMR Corp., unsecured creditors, United States bankruptcy court, US Airways Group, explanations  
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14411 clicks; posted to Business » on 18 Mar 2013 at 11:44 AM (1 year ago)   |  Favorite    |   share:  Share on Twitter share via Email Share on Facebook   more»



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2013-03-18 10:27:26 AM
"because he negotiated it as part of his compensation and the board agreed with it after consulting with third party pay consultants" is a good answer.
 
ZAZ [TotalFark]
2013-03-18 10:34:19 AM
Trustee Tracy Hope Davis said in a filing on Friday to the U.S. Bankruptcy Court in New York that American had not explained why that level of severance pay and "sweeping changes" to various employee pay programs were permissible under the bankruptcy code.

In related news, Tracy Hope Davis just got kicked out of all the good country clubs.

tenpoundsofcheese

Bankruptcy court is not bound by prior negotiations, contracts, solemn vows, or even the opinion of pay consultants.
 
vpb [TotalFark]
2013-03-18 10:41:25 AM

tenpoundsofcheese: "because he negotiated it as part of his compensation and the board agreed with it after consulting with third party pay consultants" is a good answer.


Not very.
 
2013-03-18 10:42:26 AM
Obviously that man needs a tax cut. Can't have $20 million without a tax cut!
 
2013-03-18 11:09:03 AM

Weaver95: Obviously that man needs a tax cut. Can't have $20 million without a tax cut!


rich white guy leaving a company
HOW could he live without 20 cash for a leaving bonus ???
 
2013-03-18 11:26:28 AM
Chapter 11 nulls all existing contracts and requires an almost unilateral re-write of obligations to creditors through the Chapter 11 plan, unless the case dismisses.  Even provisions such as "survives bankruptcy" are null; the power of the bankruptcy court supersedes pre-petition agreements.

The objection on its face has merit; they are committing 20 mil that could be disbursed to unsecured creditors, and instead giving it to some guy who basically lost his job.  The Trustee would be well within his powers to order a refund to be paid to creditors.  They are lucky he has only objected and not filed a motion to force turnover.
 
2013-03-18 11:33:01 AM
I'd have strong words with my Union Rep.

"What the eff are we paying you for? He does all his own negotiations and look what he gets!!"

- Disgruntled Union Member
 
2013-03-18 11:47:53 AM

ZAZ: Bankruptcy court is not bound by prior negotiations, contracts, solemn vows, or even the opinion of pay consultants.


Just ask AA's pilots.
 
2013-03-18 11:48:40 AM
Just let them eat Cake!!!

and please, U.S. Government, continue to allow the airline companies to merge into each other to create even larger companies and less competition. it can only help.


God bless, Uncle Sam.

--a Patriotic Amerian.
 
2013-03-18 11:48:50 AM
10lbofbatshiatcrazy has zero problem with folks getting screwed out of their pensions, but god forbid the 1%er take a hit to his golden parachute, because socialism!
 
2013-03-18 11:49:38 AM

tenpoundsofcheese: "because he negotiated it as part of his compensation and the board agreed with it after consulting with third party pay consultants" is a good answer.



its a good answer, all  right.   but hardly a Solution.
 
2013-03-18 11:50:50 AM

tenpoundsofcheese: "because he negotiated it as part of his compensation and the board agreed with it after consulting with third party pay consultants" is a good answer.


Which would probably pass muster, if they didn't all sit on each others boards and act as consultants for each other over what should be their pay and suitable compensation.
 
2013-03-18 11:50:54 AM

tenpoundsofcheese: "because he negotiated it as part of his compensation and the board agreed with it after consulting with third party pay consultants" is a good answer.


Oh look, someone doesn't understand how bankruptcy works.  Though, I can't say that I'm particularly surprised that you're once again proudly flying your ignoramus flag.
 
2013-03-18 11:50:58 AM

Weaver95: Obviously that man needs a tax cut. Can't have $20 million without a tax cut!



damn it!   if these clowns would just go back to cutting taxes, these problems would never have sprouted in the first place.
 
2013-03-18 11:51:51 AM
It added that the payments would "motivate a strong management team during the integration process" to make the merger a success.

These same people will tell you that increasing pay for the rank and file will make them lazy.
 
2013-03-18 11:51:54 AM
Contracts can be voided in the interests of the public, especially when they are imposed by greedy unio...

...wait, it's for a CEO platinum parachute?

Contracts are sacred, invioable bonds of trust that cannot be broken under any circumstances.
 
2013-03-18 11:52:18 AM

Duke Phillips' Singing Bears: ZAZ: Bankruptcy court is not bound by prior negotiations, contracts, solemn vows, or even the opinion of pay consultants.

Just ask AA's pilots.



i didn't know Alcoholics Anonymous had pilots.   kewl.
 
2013-03-18 11:52:55 AM

tenpoundsofcheese: "because he negotiated it as part of his compensation and the board agreed with it after consulting with third party pay consultants" is a good answer.


Or, alternately "a surprisingly large number of supposedly intelligent people had previously agreed to allow him to make off with an absurd sum of money regardless of his actual performance, the performance of the company as a whole and even if it is detrimental to the continuing operations of the company". I don't see why they can't just be honest about it.

Sure, it was in his contract. I can guarantee you if there were a couple hundred soon to be laid-off run-of-the-mill employees who had clauses like that in their contracts (likely collectively equalling a whole lot less than $20 million) the company would be falling all over themselves trying to find ways to invalidate those contracts.
 
2013-03-18 11:52:58 AM
This bozo doesn't deserve the Polish Doorknob.
 
2013-03-18 11:53:18 AM

Linux_Yes: i didn't know Alcoholics Anonymous had pilots.   kewl.


Why do you think they invented autopilot?
 
2013-03-18 11:53:21 AM

Linux_Yes: tenpoundsofcheese: "because he negotiated it as part of his compensation and the board agreed with it after consulting with third party pay consultants" is a good answer.


its a good answer, all  right.   but hardly a Solution.


Unless the contracts were from those union thugs that 'negotiate' for the workers.  Those useless tits shouldn't the rights to even look upon the face of their glorious corporate masters who are benevolent enough to deign to allow them to work at their premises!
 
2013-03-18 11:53:38 AM

Linux_Yes: Just let them eat Cake!!!

and please, U.S. Government, continue to allow the airline companies to merge into each other to create even larger companies and less competition. it can only help.


God bless, Uncle Sam.

--a Patriotic Amerian.


Amerian Airlies - Now with Cheaper Pilots!!
 
2013-03-18 11:55:29 AM
Not sure why the creditors should be left hanging out to dry on $20M when the company is in bankruptcy.

I would call shenanigans on that.
 
2013-03-18 11:56:44 AM
It's only $19.9M.  Nice troll jorb.
 
2013-03-18 11:56:55 AM
Stop telling your betters what they can and can't have. This guy is a Maker, so obviously deserves whatever largesse God sees fit to bestow upon him.
 
2013-03-18 11:57:23 AM
What's wrong with you looters? Ayn Rand would be ashamed of you. He's a CEO. He's a Rock Star. By the very definition of CEO in American business he deserves every penny he can get. Who do you hanger-ons think built this nation. When Atlas asked what he should do, shrug, I said.
 
2013-03-18 11:57:50 AM

vudutek: 10lbofbatshiatcrazy has zero problem with folks getting screwed out of their pensions, but god forbid the 1%er take a hit to his golden parachute, because socialism!


The thing is I have seen this attitude all over. Kinda makes you sick.
 
2013-03-18 11:58:24 AM
I don't know how they could expect him to get by on less than $15 million. The man probably has mouths to feed FFS!
 
2013-03-18 11:59:04 AM
www.aidthoughts.org
 
2013-03-18 11:59:37 AM
Well, cause he needed to buy shiat
 
2013-03-18 12:00:05 PM

trotsky: vudutek: 10lbofbatshiatcrazy has zero problem with folks getting screwed out of their pensions, but god forbid the 1%er take a hit to his golden parachute, because socialism!

The thing is I have seen this attitude all over. Kinda makes you sick.


And then these idiots wonder why they lose elections...
 
2013-03-18 12:00:35 PM
Severance pay beyond 2 weeks salary equivalent should be relegated lower than unsecured debt.
 
2013-03-18 12:00:39 PM

A Shambling Mound: Sure, it was in his contract. I can guarantee you if there were a couple hundred soon to be laid-off run-of-the-mill employees who had clauses like that in their contracts (likely collectively equalling a whole lot less than $20 million) the company would be falling all over themselves trying to find ways to invalidate those contracts.


I'm sure they've already succeeded invalidating most employees PTO payouts and the like.
 
2013-03-18 12:01:04 PM

tenpoundsofcheese: "because he negotiated it as part of his compensation and the board agreed with it after consulting with third party pay consultants" is a good answer.


Why do I get the feeling you would champion the return of debtor prisons?
 
2013-03-18 12:03:17 PM

MindStalker: A Shambling Mound: Sure, it was in his contract. I can guarantee you if there were a couple hundred soon to be laid-off run-of-the-mill employees who had clauses like that in their contracts (likely collectively equalling a whole lot less than $20 million) the company would be falling all over themselves trying to find ways to invalidate those contracts.

I'm sure they've already succeeded invalidating most employees PTO payouts and the like.


Well of course! Agreements with little people arent 'for realz'. Only contracts with the elite are binding, and only when it benefits the already super rich.
 
2013-03-18 12:04:28 PM

Linux_Yes: Just let them eat Cake!!!

and please, U.S. Government, continue to allow the airline companies to merge into each other to create even larger companies and less competition. it can only help.


God bless, Uncle Sam.

--a Patriotic Amerian.


It's done wonders for the banking industry. Seriously, what could go wrong?
 
2013-03-18 12:07:30 PM
Here's an idea:

20 Million golden parachute

Divided by:

Non-management employees 79,444

=

251.74 bonus check to all the employees... is it much? not really. Did they earn it? you bet...
 
2013-03-18 12:08:33 PM
Thanks Obama.

Or

I blame global warming.
 
kab
2013-03-18 12:10:20 PM

tenpoundsofcheese: "because he negotiated it as part of his compensation and the board agreed with it after consulting with third party pay consultants" is a good answer.


Wow, the CEO ballwasher brigade hit this thread in record time.
 
2013-03-18 12:11:35 PM

Weaver95: Obviously that man needs a tax cut. Can't have $20 million without a tax cut!


How can you have any pudding if you don't eat your meat?

/had to s-t-r-e-t-c-h for that one
//oh well, it's Monday
 
2013-03-18 12:12:48 PM
it is kind of a farce to pay $20 mil to the guy who took over and will give up the position all during bankruptcy.

didnt stop other airlines from doing the same thing.

...guess the point im getting at chapter 11 bankruptcy is stupidly written.
 
2013-03-18 12:16:49 PM
Under the new bankruptcy laws, he isn't allowed to be given something that is more than 10 times the standard for that company's non-management employees. In this case, the mean severance package for AA would have to be something like $1.9million PER EMPLOYEE for him to legally be allowed to walk with $20m.

This is a better explination of it.
 
2013-03-18 12:18:36 PM

CeroX: 251.74 bonus check to all the employees... is it much? not really. Did they earn it? you bet...



I wouldn't be so quick with that, have you flown AA lately??
 
2013-03-18 12:19:53 PM
He's getting $20M "leaving" American when it merges with US Airlines.

He remains chairman of the combined company.
  cuddlebuggery.com
 
2013-03-18 12:20:46 PM

ZAZ: Bankruptcy court is not bound by prior negotiations, contracts, solemn vows, or even the opinion of pay consultants.


It is if you're a bank, and while AA is not, it was part of the "too big to fail" club.
 
2013-03-18 12:21:16 PM
25.media.tumblr.com
"He's very persuasive."
 
2013-03-18 12:22:59 PM
The company said the proposed employee arrangements were found to be reasonable by pay consultants retained by its unsecured creditors committee

It was the damned pay consultants again!

DAMN YOU PAY CONSULTANTS!
 
2013-03-18 12:23:52 PM
Vulture Capitalism is a form of capitalism.
 
2013-03-18 12:32:04 PM
Give him nothing.
 
2013-03-18 12:33:52 PM

Duke Phillips' Singing Bears: Linux_Yes: i didn't know Alcoholics Anonymous had pilots.   kewl.

Why do you think they invented autopilot?


That's not far off.

http://www.milehighclub.com/about/founder.html
 
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