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Sources at Supervalu have provided MNB this morning with a copy of a memo sent out to the company by CEO Sam Duncan.

The text, in its entirety:

"Good morning,

We are well into our first quarter, and I want to thank you for your continued focus as we move forward as a stronger, more efficient company. We still have a lot of work ahead of us, but I know we have a solid team ready to take on the challenges and opportunities ahead.

"Everyone across our business areas – Independent Business, SAVE-A-LOT and the retail banners – is working hard to drive sales and control our costs. We are building momentum, and have a go-forward plan in place that we believe will deliver results and rebuild our company.

"As I shared with you during each of our recent employee meetings, I am a strong believer in rewarding performance. I am pleased to announce that our Board of Directors and executive team feel the same way and have approved implementing a bonus program for Fiscal Year 2014. The bonus plan is tightly tied to performance, and we must see results before a bonus payout will be made. Those who are eligible for the bonus plan will be hearing more details from your managers.

"I recognize that there are some of you in the company who are not eligible for our bonus plan, but I wanted to share this news with everyone because we all have a role in the success of SUPERVALU. As we continue to improve the business and show results at all levels of the organization, we will be able to consider bringing back other incentive programs such as our merit increases and 401k matches for everyone.

"I am confident in our business plan and in our team to make this happen. Let’s continue to stay focused on driving sales and generating positive results. Thanks."
KC's View:
It strikes me, upon reading this email, that a very clear message is being sent here - that it is more important to reward the people at the top who are eligible for bonus programs than it is to spread out the rewards to those who would only be available for merit increases and contributions to 401k programs.

I'm not sure that this necessarily is the best way to generate loyalty, comity and fellowship in the ranks. And this is proven out by the email I received from the Supervalu employee who wanted the opportunity to respond to the company CEO...

I have worked for Supervalu for many years (before the Albertsons debacle) and have always been proud to invest the time and effort to perform at 110%. When Sam came on board, I believed he was going in the right direction to turn this company around.  However, as I logged in this weekend to catch up and get ahead for the new week (after having worked 10-12 hour days + weekends for the last several  months)  I was dismayed to read how bonus eligible personnel will be rewarded first before wage increases and the 401K match are reinstated for all.

We have been told we are “in this together”, yet we have seen Wayne Sales take $16M+ out of the company, we have had coffee, paper plates, and locker room towels taken away; our work off-site days have been limited to two days per week, health insurance costs have increased every year and now only bonus eligible employees will be rewarded for ALL of our hard work.

Departments have lost key employees because SV can’t pay competitively and the lack of merit increases/401k match. Remaining workers are left picking up the work and are asked to continue to do more with less. As Sam said in the last quarterly meeting, he was concerned about “Optics” (how SV is perceived by its customers) and would focus on cutting out unnecessary expenses, with which I completely agreed. Sam – How is your message going to be perceived by the many (not “some”) employees not bonus eligible?

Some senior staff and supervisory levels were bonus eligible up until a couple of years ago.  Now those levels will not see merit increases OR bonuses.

Even while being a whole-hearted capitalist and one who can rationalize executives earning higher salaries and being paid bonuses when they perform, I believe this decision was unconscionable.

Increased working hours and health insurance costs have led to a net decrease in total pay. These are real costs to the family in both money and time taken and we are nowhere near keeping up with inflation.

Dear Sam and Board, I was planning on spending several hours of my weekend working on SV tasks. Due to Sam’s message I will now spend those hours working on sending out resumes.

The question is, how many good and hard-working Supervalu employees feel the same way?