Hostess CEO cuts everyone's pay but his
Gregory Rayburn argues that because he isn't on the Hostess payroll, he should still get his full $125,000 a month.
Gregory Rayburn will still get his $125,000 a month, or $1.5 million a year, the company told The Huffington Post. His logic is that because he isn't on the Hostess payroll, he doesn't have to take part in the company-wide pay cut.
Rayburn looks at himself as temporary, telling The New York Post he's more like outside help and therefore entitled to his full salary. He said he will leave Hostess when he's no longer needed, the Post reports.
Rayburn joined Hostess in February as chief restructuring officer, and one month later was named president and CEO. He's also on the board of directors.
To be fair, Rayburn is taking some measures to rein in his pay. He was eligible to get a bonus of between $375,000 and $1.125 million, but decided to give up the money, The Huffington Post reports. And Rayburn and three other top executives are taking $1 for the rest of the year in pay, but their full salaries will be reinstated in January.
That's small comfort to the rank-and-file employees who watched a number of Hostess executives get sweet pay raises and bonuses as the company barreled into bankruptcy. The company wants 19 top managers to stay with Hostess as it moves into the liquidation phase, and got approval from a bankruptcy judge to award up to $1.75 million in retainment bonuses.
The execs only get those bonuses if they perform specific tasks related to easing the operational wind-down, a company spokesman told The Los Angeles Times. Rayburn won't be getting a bonus.
At least 15,000 Hostess employees are losing their jobs in bankruptcy, but Hostess wants to keep about 3,200 to help wind down operations.
Hostess cracked under nearly $1 billion in debt, and blame for its demise can be spread far and wide. Private-equity firms funding the company couldn't get it off the ground. When consumers lost interest in carbs and sugar, the biggest innovation Hostess could come up with was banana-filling Twinkies. Although union members agreed to steep concessions over the years, it still failed to adjust to new realities. The old CEO, Brian Driscoll, suddenly bailed in March without explanation, Fortune reports.
More from Money Now
Who cares what he or any CEO makes. In this country any of us have an opportunity to be that CEO and thats the real point. If you dont believe that then you are just making excuses for yourself and others. If you think that CEO doesnt deserve it, go ahead become one. Oh yeah, its not that easy is it. But just because it isnt easy doesnt mean it cant be done. Instead, the excuse makers and the blamers find it much easier to talk bad about fellow Americans and the President himself is more than happy to pit us against each other. Question for all the complainers : Do you hate athletes and movie stars just as much? They make tens of millions a year. Why is it just the big bad CEO you seem to have a problem with?
I don't see why anyone is complaining here, they needed to save money and they did. I mean cutting your workforces pay was a stroke of brillance, who else could have thought of this? After all so many other options in cost savings were put forth by him first, right??? I mean all other avenues of cost savings were surely explored and cutting your workforces pay or jobs is a last resort...... right?
This guy has clearly earned every penny and why shouldn't he collect his full pay.... Because letting profit drop by 0.5% would be out of the question, think of the board of directors, they may get paid based on profit and if it were to slip they and the CEO may not get their bonuses.... that is BS. Won't someone please think of the poor board????????? And if the CEO lost 8% he might have to downgrade his plane to the one without (gasp) a full surround sound stereo. I for one am not willing to ask him to make that kind of sacrifice, it's un-American!!!!!!!!!!!!!
The company died due to bad marketing and lousy product development along with high labor costs. While I agree the execs are overpaid, the unions are very much a big reason Hostess is closing. 40,000 employees @ $15/hr avg @ 8 hours a day @ 5 days a week @ 52 weeks = $1.2 billion. And that's not including benefit costs. That is more of a cause for the company closing than the $7 million (guessing) paid to the execs.
Copyright © 2013 Microsoft. All rights reserved.
Fundamental company data and historical chart data provided by Morningstar Inc. Real-time index quotes and delayed quotes supplied by Morningstar Inc. Quotes delayed by up to 15 minutes, except where indicated otherwise. Fund summary, fund performance and dividend data provided by Morningstar Inc. Analyst recommendations provided by Zacks Investment Research. StockScouter data provided by Verus Analytics. IPO data provided by Hoover's Inc. Index membership data provided by Morningstar Inc.
The good news: Bad weather means fewer drivers on the road, and they're going slower than usual. The bad news: It's still dangerous.
- 8 questions to ask before Mom and Dad move in
- High deductibles fuel new worries of Obamacare sticker shock
- How to use your credit card to donate to charity
- Try this instead of raising the minimum wage
- People left $500,000 in coins at airports last year
- How your driving can affect your credit
- Obamacare projected to cost hundreds of billions less
- November jobs report: Winners and losers
- Student loan debt climbs for 5th year in a row
[BRIEFING.COM] There wasn't a lot of excitement in the stock market today and there is nothing wrong with that. After rallying in broad-based fashion on Friday, the major indices stood their ground (for the most part) amid a lack of conviction from buyers and sellers alike.
Today wasn't a case so much of the stock market going up as it was a case of some influential stocks going up to keep the major indices on a winning path. In fact, decliners were just about even with ... More
More Market News
The photo-sharing site only has 10 employees, and it may be up for grabs.