CEO Takes 90% Pay Cut To Give Employees HUGE Raises!

[monkeybingo]

nice! Finally a CEO who values employees than the stakeholders. Anyway... This is impossible for any company with 1000+ employees

[TXSTYLE]

Originally Posted by monkeybingo

nice! Finally a CEO who values employees than the stakeholders. Anyway... This is impossible for any company with 1000+ employees

Maybe on the level that Price did with his 100 or so employees. BUT, it can and certainly SHOULD be done elsewhere no matter how large the company. In this age of CEOs raking in $14M-$50M annually, if they were to to go down to say $1M - $5M, and then the other Top Execs who are also being paid tens of millions (CFO, COO, etc) then yeah, even with thousands of employees, they would get decent raises.

[NickyC]

Good man, well done. It's absolutely disgusting the CEO pay to average company worker pay disparity that has happened in this country. It's outright theft honestly.

Maybe if workers would get their heads out of their asses and focus on things a bit more important than football and reality TV, incomes for the average American would start rising again. Oh, who am I fooling? You've got a Federal Reserve who will destroy any traction an idea like that would get.

[Taskmaster]

Originally Posted by Maestro

Not to say what he is doing is not great it is. However, Salary my be only one part of his compensation even as the owner. A friend of mine had his own business and took a small salary, because he also received a quarterly dividend which was the majority of his compensation. Remember a salary pays fed, SS, medicad, local and state taxes and if you are in the higher tax bracket, that is far more than the 15% for dividends for Feds and some state do not tax dividends.

Also he not doing these people much of service, they now think their skills are worth more and if they want to go somewhere else, no one will pay them that much.

That's more of their fault than it is his.

[P1]

Why are people so concerned about what others are making in the company? As long as you feel you are fairly compensated, why do you care how much the CEO makes?

[JasonCSU]

Originally Posted by P1et

Why are people so concerned about what others are making in the company? As long as you feel you are fairly compensated, why do you care how much the CEO makes?

Maybe it is due to this "do more with less" ethos many companies seem to be pushing these days. Employees are expected to work longer hours to make up for under staffing and are not necessarily being compensated for taking on additional responsibility. This can be pretty discouraging for people while executives are raking it in as TXSTYLE noted, "chief executive pay as a multiple of the typical worker’s pay rocketed from an average of 20 times in 1965 to 295.9 in 2013."

[zeevette]

It will have no effect besides PR for his own company.This model is not possible in a real corporation, with stockholders, and a board of directors. There are different ways to structure your income in private held corporations.

[Dalko43]

Originally Posted by NickyC

Good man, well done. It's absolutely disgusting the CEO pay to average company worker pay disparity that has happened in this country. It's outright theft honestly.

How is it theft?

Workers agree to work for a certain salary. If they don't like that salary:
A) they can go to school and apply for a job higher up in the bureaucracy

or

B) go to another job in the same sector that offers better benefits

or

C) go into another field/sector where work receives better compensation.

When people talk about the huge pay discrepancy between CEO's and blue-collar workers, more often than not they are referring to companies like McDonald's and Walmart. While I agree that there needs to be a certain minimum wage for workers at those kinds of companies, I definitely don't think there is anything wrong with a CEO there getting paid much more than the worker....one is flipping burgers, the other is developing and implementing corporate and fiscal strategy....two totally different skill sets.

[NickyC]

Originally Posted by Dalko43

How is it theft?

Workers agree to work for a certain salary. If they don't like that salary:
A) they can go to school and apply for a job higher up in the bureaucracy

or

B) go to another job in the same sector that offers better benefits

or

C) go into another field/sector where work receives better compensation.

When people talk about the huge pay discrepancy between CEO's and blue-collar workers, more often than not they are referring to companies like McDonald's and Walmart. While I agree that there needs to be a certain minimum wage for workers at those kinds of companies, I definitely don't think there is anything wrong with a CEO there getting paid much more than the worker....one is flipping burgers, the other is developing and implementing corporate and fiscal strategy....two totally different skill sets.

I'm referring to cases such as detailed below:

http://pando.com/2014/01/23/the-tech...gineers-wages/

The fact is I believe most CEO pay is not market driven, but rather driven by agreements amongst CEOs themselves. Graveyards are full of indispensable men, none of these people are worth the money they are paid, especially considering it's done on the backs of the workers.

This is clearly wage theft and your pie in the sky, RAH RAH RAH I can make it in America A/B/C argument is naïve as hell.

[Dalko43]

Originally Posted by NickyC

I'm referring to cases such as detailed below:

http://pando.com/2014/01/23/the-tech...gineers-wages/

The fact is I believe most CEO pay is not market driven, but rather driven by agreements amongst CEOs themselves. Graveyards are full of indispensable men, none of these people are worth the money they are paid, especially considering it's done on the backs of the workers.

This is clearly wage theft and your pie in the sky, RAH RAH RAH I can make it in America A/B/C argument is naïve as hell.

Granted, the above article is an example of CEO's conspiring together to maintain low wages, which is illegal, and not a reflection of American capitalism.

But last time I checked, Silcon Valley worker professionals: are not blue-collar (per capita they have one of the highest median wages in the country), and are not struggling for economic survival the same way others workers are (say from Walmart). So yes, what Steve Jobs and other tech company CEO's did was wrong, and will likely warrant remunerations, but it's not the norm. Pay gaps have existed before scandals like these and will continue to exist afterwards.

Also, you do realize that your "pie in the sky" and "make it in America" comments, though intended to be sarcastic, do have factual basis. Steve Jobs, Warren Buffett, Elon Musk, to name a few were all self-made men who built their companies, and their wealth, from the ground up. Why do people get angry when those kinds of people reap rewards for their endeavors? They built their own success...are the not entitled to the benefits?

[fecurtis]

Originally Posted by P1et

Why are people so concerned about what others are making in the company? As long as you feel you are fairly compensated, why do you care how much the CEO makes?

Because it's the cool thing to do on social media.

[fecurtis]

Originally Posted by UncleWede

Bill Gates for YEARS was only paid $1 in salary. Yet he has annual charity payments far in excess of what I hope to earn in my lifetime (unless I win some lotto or something)

What was his stock option compensation?

The whole $1 salary thing is such a win win, lower tax rates (capital gains vs. normal income) and good PR.

[Mr Tonka]

Originally Posted by fecurtis

What was his stock option compensation?

The whole $1 salary thing is such a win win, lower tax rates (capital gains vs. normal income) and good PR.

If i'm not mistaken, i believe the IRS doesn't allow that any longer.

Maybe it's just for private business owners. I wanted to make my smaller smaller and pay myself more rent since taxes on rents is lower than my tax bracket, but my CPA said I have to take a "reasonable" salary per the IRS. And then it may only be applicable if you're receiving other types of revenue from the business.

Don't bother reading this post, it's likely irrelevant.

[P1]

Originally Posted by fecurtis

Because it's the cool thing to do on social media.

I tend to dislike social media. Just so much #yolo everywhere.

[Maestro]

Originally Posted by UncleWede

Bill Gates for YEARS was only paid $1 in salary. Yet he has annual charity payments far in excess of what I hope to earn in my lifetime (unless I win some lotto or something)

I am being lazy here, but where it the cite on that, I never heard Bill Gates taking $1 salary. I know Steve Jobs only took $1 when he return to Apple as confidence he could turn it around and most all of his pay came from stock options which he only paid capital gains.

Lee Iaccoca also took $1 when he became CEO of Chrysler and is did that when he was asking all the union works to take a pay cut to keep their jobs and he also required management to take a pay cut. Unlike those company on wall street who were loosing money and firing people and then taking big bonuses.

[Taskmaster]

Originally Posted by Dalko43

Granted, the above article is an example of CEO's conspiring together to maintain low wages, which is illegal, and not a reflection of American capitalism.
?

That's exactly what it is, do you remember history class, and why unions existed in the first place? Why FDR had to step in and regulate how businesses could treat workers?

Stop looking back on history with rose colored glasses, that's a prime example of American capitalism.

[fecurtis]

Originally Posted by TheAxiom

That's exactly what it is, do you remember history class, and why unions existed in the first place? Why FDR had to step in and regulate how businesses could treat workers?

Stop looking back on history with rose colored glasses, that's a prime example of American capitalism.

Ugh, I rue the day when someone decided it was, for some reason, wrong to have 10 year olds working in factories.

[Mr Tonka]

Originally Posted by fecurtis

Ugh, I rue the day when someone decided it was, for some reason, wrong to have 10 year olds working in factories.

Yeah, they ruined it for everyone. I would have offered them office jobs, what's wrong with that?

[fecurtis]

Originally Posted by Mr Tonka

Yeah, they ruined it for everyone. I would have offered them office jobs, what's wrong with that?

And now look what came of it. You've got 12 year olds hacking into US companies and government databases when they could be product managers over at Google or at least Geniuses over at Apple stores.

[Whostheboss]

Of course this was A PR stunt. However, it's a respectable one.
I'm willing to bet that Price has had this planned for a while. He'll earn $1M for a while and then drop his salary.

The article talks about how he can still live a "luxe" life style. He has had the whole thing planned out for years.

Still a great job by him.

[x622]

Guys, you do understand that the CEO of a major company is not the "boss" usually right? They report to the board of directors, which are usually substantially more wealthy and generate substantially more income than a regular "CEO".

Unless the CEO is a founder and owns a significant percentage of shares, it's not what you're thinking in terms of inequity. Furthermore, it's literally just a job, but a critical one.


Put yourself in the mindset of a person on the board of directors for a company that's worth billions. First, visualize you have real money, like let's say your net worth is 9 figures and you have substantial capital invested in this company that represents a good chunk of that net worth. You seek and find a talented person to guide and run your company/investment into prosperity and make returns on said investment. Giving this guy 1-2-10-30 million dollars isn't substantial if your net revenue is in the capital B's.


As a business owner, it's my job to make sure my employees are happy and fulfilled so that they can produce as efficiently as possible. They are my force amplifiers and I literally can't be successful without them. I don't really get this guy's angle because he could of instead gave people raises and then perhaps put a portion of that money towards growing the business further. Further, if he was making a mil+ per year and has been savvy with his investments, dropping down to 70k in a company you own doesn't really mean much. This also doesn't factor that he can have "expenses" or "consulting fees" or other creative things to channel money out without drawing a "salary". It also means he can kiss the prospect of selling that company goodbye because the numbers on paper now look like shit.

Fantastic PR though. Hope it was worth 3 million.

[its55]

My guess is he has other motives behind this and is already extremely rich so the "pay" doesn't matter.