Posted on 07/10/2009 5:31:52 AM PDT by Red in Blue PA
American International Group is preparing to pay next week millions of dollars more in bonuses to dozens of corporate executives, a source familiar with the development said.
AIG [AIG 9.48 --- UNCH (0) ] has been talking with Washington's newly-appointed compensation czar Kenneth Feinberg about the bonuses, which are due to be paid on July 15, said the source.
The company is reviewing its compensation plans with Washington as it tries to avoid the national furor set off by $165 million in retention bonuses paid to employees of a financial products unit in March.
Much of AIG's $99 billion in losses last year stemmed from derivatives written by that unit.
Feinberg was appointed last month to oversee the compensation of top executives at seven firms that have received large federal bailouts.
The firms must convince Feinberg "they have struck the right balance to discourage excessive risk taking and reward performance for their top executives," Treasury spokesman Andrew Williams said in a statement, responding to AIG's pending bonus payments.
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In total, U.S. taxpayer aid of up to $180 billion has been extended to the insurer that once claimed global dominance. The payments AIG is set to make next week were previously disclosed.
(Excerpt) Read more at cnbc.com ...
Sheesh...I wish my company offered retention bonuses, I’ve been here 23 years. Our only bonus is that we still have job.
Tax payer money at work....along the same lines as $18 million being paid for the redo to a website.............
Maybe we should let these guys go and let a Congressional committee trade the remaining $1.6 trillion in derivatives. I’m sure they would do a bang-up job.
Waiting for the AIG apologists who claim the execs deserve these bonuses in 5, 4, 3, 2.......
They couldn’t do much worse a job than AIG has already done, that’s for sure!
I’m no apologist, but I would like to know if these are contractual obligations like they were before or not.
Oh wait - After the GM/Chrysler bond holder fiasco, contracts are meaningless, aren’t they?
Even though they may have had contracts, I will not shed one tear for overpain incompetent execs who may not receive their “fair” share.
They have proven themselves to be grossly incompetent.....they should be lucky they aren’t in prison.
The contracts were NOT performance based - so you are saying you don’t care if the law is actually followed?
If so, I must admit I find it an interesting position for a conservative.
For people who brought the entire US economy to the brink of ruin, no!
I could care less if the govt stripped them of their homes too!
These people deserve or disdain, not a bonus (even if said bonus was contractual)!
Have you considered that the Constitution is another contract - and your attitude can easily be applied in the same manner there?
You are wrong, IMO. Very, very wrong.
You are welcome to have the last word.
Just as I would not have a problem with stripping these execs of their homes etc, I would have no problem with summary execution of violent gang members.
It goes against the Constitution, but at the same time I believe both would be the right thing to do (and because of that, will probably never happen!)
Same wording, different meaning
I wrote insurance about 5 years ago...you usually get compensated 3 ways
1. Commission upon the sale
2. Proficiency Bonus at the end of the quarter for meeting or beating you projections of ALP (Annual Life Premium..for Life Insurance)
3. Retention Bonus at years end for writing good policies that the company is still receiving premiums for.
So the better policies that you write to good clients that stay on the books for years you are rewarded for.
So these bonuses are for policies that AIG is still receiving monthly premiums for and therefore are a legal contract between the salesperson and the Company
Organized crime types make contracts as well. Does that make them just or legal?
The fact is that taxpayers “own” this company and as a shareholder I’d like to see all of them terminated.
What laws were broken here? If the contract is predicated on illegal activity (as opposed to unsavory but legal), the contract is nullified. If the activity is not illegal, the contract is enforceable.
As opposed to getting sued for breach of contract, this is cheap money.
There, there, letting feeeeeeeeeeeeeeeelings trump law is not a good way to operate. That’s how the libs do it, and look where it’s getting us.
I don’t disagree with not being happy about it, but laws and contracts must be followed, despite how one feeeeeeeeeeeeeeeels about it.
Every retention bonus I have ever seen followed this definition:
A Retention bonus is an incentive paid to a key employee to retain them through a critical business cycle.
A retention bonus is when key staff are offered a bonus in order that they stay with the company.
Retention bonuses are a form of financial incentive utilized by many different businesses. The bonus is usually issued to key employees as a strategy to motivate the individual to remain in the employ of the company. The retention bonus is an incentive that is offered above any beyond any other salary, wage, or other benefits currently extended to the employee via his or her compensation package. Considered a one-time transaction, the bonus is often a show of appreciation for the talents and expertise that the employee provides to the employer. In turn, it is hoped that the employee will reconsider any other employment options that may have come about and stay with the employer for at least a little longer.
As working in HR is one of my responsibilites and I understand needing to retain critical personnel during difficult business transitions, I don't really have a problem with retention bonuses...just not in the astronomical amounts that have been distributed lately by companies such as AIG.
By all means, lets put millions in their pockets. There is no such thing as "failure". Merely experiences to be learned from.
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