The Buffalo News reports that Tops Markets, which went into bankruptcy protection in February, want to put into place bonus programs totaling more than $7 million that would reward execs for exceeding certain financial targets and reward others for staying with the company through its financial travails.
The story says that the company is proposing up to $3.6 million in bonuses that would be paid to “its five highest-ranking executives if the supermarket company exceeds its financial targets as it restructures its business in bankruptcy.” The consultant who put the bonus program together says that “the base salaries of Tops' highest-ranking executives are in the bottom quarter of other executives at comparable companies in the grocery industry, and Michael Buenzow, Tops’ chief restructuring officer, says that the bonuses are “essential.”
In addition, the News reports, Tops “also is proposing a separate bonus plan - with up to $3.5 million in payments - that would go to 115 key employees as part of a plan designed to both reward them for bettering Tops' financial situation and give them an incentive to stay at Tops and not seek new jobs elsewhere as the chain moves through the bankruptcy process. That plan would offer bonus payments of $10,000 to $100,000 apiece to the 115 Tops employees.” The story reports that “Buenzow said the bonus plan for the 115 key employees is needed because those workers have important expertise and experience that would set back the reorganization efforts if they were to leave. Those workers also are being asked to work longer hours and take on added responsibility during the bankruptcy.”
Tops has some 14,000 employees, and it is believed that the company will have to close between 18 and 24 of its 169 stores and lay off some employees during the reorganization process.
The story says that the company is proposing up to $3.6 million in bonuses that would be paid to “its five highest-ranking executives if the supermarket company exceeds its financial targets as it restructures its business in bankruptcy.” The consultant who put the bonus program together says that “the base salaries of Tops' highest-ranking executives are in the bottom quarter of other executives at comparable companies in the grocery industry, and Michael Buenzow, Tops’ chief restructuring officer, says that the bonuses are “essential.”
In addition, the News reports, Tops “also is proposing a separate bonus plan - with up to $3.5 million in payments - that would go to 115 key employees as part of a plan designed to both reward them for bettering Tops' financial situation and give them an incentive to stay at Tops and not seek new jobs elsewhere as the chain moves through the bankruptcy process. That plan would offer bonus payments of $10,000 to $100,000 apiece to the 115 Tops employees.” The story reports that “Buenzow said the bonus plan for the 115 key employees is needed because those workers have important expertise and experience that would set back the reorganization efforts if they were to leave. Those workers also are being asked to work longer hours and take on added responsibility during the bankruptcy.”
Tops has some 14,000 employees, and it is believed that the company will have to close between 18 and 24 of its 169 stores and lay off some employees during the reorganization process.
- KC's View:
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Where the hell did these guys go shopping for their bankruptcy strategy and bonus programs? Toys R Us?
Is anyone going to be surprised if the next press release is about how Tops is seeking concessions from unionized employees as it goes through reorganization? After all, according to the story, Tops “has told UFCW officials that it plans to ask a bankruptcy court judge to allow it to reduce its contributions by nearly two-thirds to the already underfunded pension plan that covers most of its employees.”
Tops hardly is alone in proposing these sorts of plans, and my immediate reaction generally is one of disgust - it always smacks of top execs looking for bonuses simply for doing their jobs, while people further down the food chain, on the front lines - who they need to buy in as they seek ways to make their stores more compelling and differentiated - are expected to do more for less and with less.
It was reassuring to see that MNB fave Burt Flickinger, managing director at Strategic Resource Group, told the
I will say that allowing 115 people into the bonus pool is a step in the right direction, but only a baby step. That doesn’t even cover every store manager in the company.
Sure, some folks might leave Tops if they don’t get bonuses. But at the moment, having Tops at the top of your resume isn’t exactly an advantage, or a great calling card when looking for work.
I’m just so tired of this crap. Front line employees are going to be hurt. I suspect that landlords and vendors probably are going to take it on the chin. But a few people at the top … they’re going to try to make extra money for sticking around to fix problems that they helped create.
What a crock.
