Friday, November 27, 2009

Nortel gives more raises to executives

Information from Canada Broadcasting Company

Management at Nortel Networks Corp., already under fire for handing out executive bonuses, approved a plan this fall to give another round of raises to its top managers, according to an internal corporate document obtained by CBC News.

The raises, in the form of increases in salary, investments or bonuses, are part of the company's plan to retain employees as it restructures after filing for bankruptcy protection in January.

But they come at a time when many laid-off and retired Nortel employees are having to fight the company in court for their severance packages, pensions and disability payments

Former Nortel president Bob Ferchat told the CBC he was surprised at the extent to which executives at a company in bankruptcy protection were rewarding themselves.

"My reaction, frankly, to the document is 'Here we go again'," said Ferchat. "It's another round of people dividing the proceeds, eating the carcass of the company before it's even dead."

14 executives to earn over $500K

The internal document obtained by CBC outlines a new compensation scheme for 72 Nortel executives that will see them get a total of $7.5 million US on top of their current salaries in 2009.

Of those 72 executives, 14 will be getting compensation of $500,000 or more.

The biggest earner under the new compensation plan is former treasurer John Doolittle, who took over as head of the company's corporate group in August after the departure of chief executive Mike Zafirovski. Doolittle's total compensation has been bumped to $1.68 million this year, an increase of 1.12 million over 2008, when he earned $390,000 US in salary and an estimated $170,000 US in investment and bonus money.

1 comment:

  1. Take a look at Mark Evan's All About Nortel Blog, "Cartoon of the Day" 30 Nov. There is a comment that includes a link to 5 CBC News clips 26 &27 Nov that covered this story of US$7.5M bonus to 72 nortel execs.