By Uniongal (aka bendygirl)
crossposted to Uniongal

Continental cuts workforce and more due to fuel costs

DALLAS -- Continental Airlines said Thursday it is cutting 3,000 jobs and reducing capacity by 11 percent, citing record fuel costs that have pushed the industry into its worst crisis since 2001. It also said its two top executives will forgo pay for the rest of the year.

The job cuts represent about 6.5 percent of the company's work force of 45,000.

However, Continental seems to have a conscience:

The company also said Chairman and Chief Executive Lawrence Kellner and President Jeff Smisek will not take salaries or incentive pay for the rest of the year.

Did you catch that, from September until the end of the year, Kellner and Smisek will forego pay. And how much is that exactly? The Post claims:

Last year, Kellner got a salary of $712,500 and total compensation that the company valued at nearly $6 million, down 9.3 percent from the year before, according to an Associated Press analysis of a company filing with the Securities and Exchange Commission.

However, about one-third of Kellner's compensation was in stock and option grants that are now worth far less than they were when granted in February 2007 because of the slump in the company's stock. In a filing Wednesday, the company said 2008 salaries would be $296,875 for Kellner and $240,000 for Smisek.

So this salary issue made me start thinking about Dick E Dauch at American Axle and his entitlement mentality. Not long back, over at Freep (Detroit Free Press), there were all these anti-union folks pointing out that Dauch’s more than $10 mill was fair compensation for him starting the company and making it profitable. That even if they weren’t profitable (they were last year at over $37 mill profits), he still deserved a high salary of over $1mill. I wonder how many of these same people are cheering Kellner’s and Smisek’s decisions to forego pay during the current fuel crisis.

But before anyone gets their panties in to a bunch and quotes me anything about how Americans get paid too much and CEO’s earn their keep or that labor is a commodity and blather on about the market, let me point out this gem from the Post:

The company said that several fare increases have not been enough to offset the rising cost of fuel. Continental estimates it will spend $2.3 billion more this year than last _ a difference of $50,000 per employee. Fuel has surpassed labor as Continental's biggest expense.

My dad’s shop is having a similar problem. The cost of running the presses and hammers is high and he’s trying to get the company to add a fuel surcharge to orders but he hasn’t been successful at this yet. Since my dad gets a profit sharing incentive through work as his bonus, it’s important to him that the company make money and he’s sitting back and watching as his 1 to 2% bonus becomes fuel for running a hammer for a couple of days. Kind of sucks, doesn’t it?

I’m hopeful that Continental will be able to work things out without layoffs, perhaps through buyouts or retirement or attrition, because I really don’t want to see anyone have to figure out how to make it in this economy without a job and no prospect for new employment.

By Uniongal (aka bendygirl)
crossposted to Uniongal

Continental cuts workforce and more due to fuel costs

DALLAS -- Continental Airlines said Thursday it is cutting 3,000 jobs and reducing capacity by 11 percent, citing record fuel costs that have pushed the industry into its worst crisis since 2001. It also said its two top executives will forgo pay for the rest of the year.

The job cuts represent about 6.5 percent of the company's work force of 45,000.

However, Continental seems to have a conscience:

The company also said Chairman and Chief Executive Lawrence Kellner and President Jeff Smisek will not take salaries or incentive pay for the rest of the year.

Did you catch that, from September until the end of the year, Kellner and Smisek will forego pay. And how much is that exactly? The Post claims:

Last year, Kellner got a salary of $712,500 and total compensation that the company valued at nearly $6 million, down 9.3 percent from the year before, according to an Associated Press analysis of a company filing with the Securities and Exchange Commission.

However, about one-third of Kellner's compensation was in stock and option grants that are now worth far less than they were when granted in February 2007 because of the slump in the company's stock. In a filing Wednesday, the company said 2008 salaries would be $296,875 for Kellner and $240,000 for Smisek.

So this salary issue made me start thinking about Dick E Dauch at American Axle and his entitlement mentality. Not long back, over at Freep (Detroit Free Press), there were all these anti-union folks pointing out that Dauch’s more than $10 mill was fair compensation for him starting the company and making it profitable. That even if they weren’t profitable (they were last year at over $37 mill profits), he still deserved a high salary of over $1mill. I wonder how many of these same people are cheering Kellner’s and Smisek’s decisions to forego pay during the current fuel crisis.

But before anyone gets their panties in to a bunch and quotes me anything about how Americans get paid too much and CEO’s earn their keep or that labor is a commodity and blather on about the market, let me point out this gem from the Post:

The company said that several fare increases have not been enough to offset the rising cost of fuel. Continental estimates it will spend $2.3 billion more this year than last _ a difference of $50,000 per employee. Fuel has surpassed labor as Continental's biggest expense.

My dad’s shop is having a similar problem. The cost of running the presses and hammers is high and he’s trying to get the company to add a fuel surcharge to orders but he hasn’t been successful at this yet. Since my dad gets a profit sharing incentive through work as his bonus, it’s important to him that the company make money and he’s sitting back and watching as his 1 to 2% bonus becomes fuel for running a hammer for a couple of days. Kind of sucks, doesn’t it?

I’m hopeful that Continental will be able to work things out without layoffs, perhaps through buyouts or retirement or attrition, because I really don’t want to see anyone have to figure out how to make it in this economy without a job and no prospect for new employment.

By uniongal (aka bendygirl)
crossposted on Dailykos and Uniongal

Obama made his first public comments about the American Axle strike last Thursday in Macomb and then, suddenly, there’s an agreement. I highly recommend seeing the video and listening to what he says about American Manufacturing jobs:


Let's take a look at the “agreement” Mlive has the skinny:

DETAILS OF THE DEAL
Details of the tentative agreement between the United Auto Workers and American Axle and Manufacturing Holdings Inc.:

WAGES: Varies by factory location. Production workers in Detroit would see pay cuts from $28 per hour to $18.50, up from $17 the company was offering. Factory support workers would make $14.35 in Detroit and $10 per hour in Three Rivers.

BUYOUTS: Workers with less than 10 years of seniority could get $85,000 to leave the company. Those with 10 or more years could get $140,000.

PLANT CLOSINGS: Company will close forges in Detroit and Tonawanda, N.Y. No date was revealed for the closures.

EARLY RETIREMENT: Workers who are 60 or above with 10 or more years of service could get $55,000 to retire.

BUYDOWNS: Workers would get three annual payments to make the transition to lower wages. The maximum amount would total $105,000.

BONUS: Workers would get a $5,000 signing bonus.

THE VOTE: Starts Monday at some UAW locals. A large local in Detroit votes Thursday.

The “deal” is pretty darn disappointing especially in light of American Axle’s profitability, rare in the GM spin-off companies. So, let’s take a look at the striker’s reactions from the AP to step up their coverage of the American Axle strike:

After the meeting, Adrian King, outgoing president of UAW Local 235 in Detroit, said the session didn't go well. Workers were angry about the deal, and their frustration was compounded by a malfunctioning public address system that hampered questions from the crowd.
"We had a lot of angry brothers and sisters," he said. "It's definitely a hard-looking contract, very tough pill to swallow for the membership."

>snip<

Most workers leaving the meeting Sunday predicted the vote will be close. One worker tossed pages of the summary into the air as he walked out.

"There will be a lot of unhappy people," Reed said as he carried a picket sign outside the school. "But I think it's going to be accepted."

Today, American Axle workers are voting on this “deal”. From Mlive for some, it’s good news like:

Jeff Claussen, 58, of Three Rivers, said he is prepared to take a buyout and will retire after 28 years at the Three Rivers plant. His 59-year-old wife, Ruth, retired last year.

"If you prepared for retirement, and we have for the past 20 years, then I guess you're all set," Claussen said.

For some, it’s really bad news (from AP)

I'm voting no. It's totally unacceptable," said Gary Reed, 52, of Warren, who criticized American Axle Chairman and CEO Richard Dauch for making millions while asking production workers to take a pay cut from $28 per hour to $18.50.

"It's a slap in our face," Reed said. "We've been watching this guy making millions and millions of dollars even while we've been on strike, and were going to accept a stab in the back and just walk away with a smile on our face?"

And for others, it’s a mixed bag, from Freep

"I feel like I'm done, but I have no choice," said Tod Rippe, 43, of Dearborn. He said he plans to accept a buyout and may move out of Michigan. "It's a nightmare. It really is."

Mike Ulicne, 39, of Trenton said the contract would be tough to accept.

"I'm relieved, but not happy or satisfied," Ulicne said.

>snip<

Terasiena Cunningham, 36, of West Bloomfield started a similar chant for workers gathered outside the school.
Cunningham said she feels workers gained little, if anything, by going on strike.

"We can get better than this," she said. Cunningham also said she wished the two sides had extended the contract that expired Feb. 26, allowing workers to stay at their jobs as negotiations continued.

Former Local 235 UAW Vice President Erik Webb, 39, of Detroit said a much calmer meeting was held Sunday afternoon at the Local 235's union hall in Hamtramck, and predicted the contract would pass.

"Everybody who has been out on the picket line has been frustrated. People are ready to go back to work," Webb said. "We didn't really get what we wanted to get, but something is better than nothing."

>snip<

"Most of us are at a point where, financially, we are so ruined that this contract beats being homeless," said Michael Dudun, 46, of St. Clair Shores.

Workers at American Axle are hurting and some are willing to vote for anything. After 11 weeks (Wednesday marks 12 weeks out), it’s understandable. Again, from Mlive

Local workers have been living on $200 a week in strike pay. Many workers who said they were unhappy with the settlement said they would vote for it anyway.

"It's just a nasty situation," said Curtis McCall, 45, an American Axle worker who attended an informational meeting Sunday in Detroit. "You almost have no choice. If you vote no, then really you're out in the cold."

Workers will see their wages slashed under the deal.

A 54-year-old worker from Lockport Township, who declined to give his name, said he will see his pay drop from $27 an hour to $14.50. The 15-year employee said Sunday he hadn't decided how he would vote.

"We're putting one of our trucks up for sale, I've sold some scuba equipment on eBay -- but I just don't think we can adjust to such a drastic rate in pay," the worker said.

The summary of the contract distributed by the union said there will be buyouts of $85,000 for someone with less than 10 years with the company and $140,000 for a worker with more than 10 years. An offer of a $55,000 early retirement bonus also was included in the proposed contract.

Workers would get a wage "buydown" of up to $105,000 paid over three years to help ease the transition to lower hourly pay. The size of the buydown would vary with the size of a worker's pay reduction.

It’s even tougher to swallow a contract like this when you know that Dick Dauch will be shelling out nice bonuses to himself again next year.

But then again, what can we expect in this day and age? The haves like Dauch can reap $10 plus millions dollar compensation packages while the working stiff gets a whopping $14 to $17 an hour. Seems an awful lot like the times of the Robber Barons and I for one don’t want to return to the days of ole and the likes of Carnegie and Rockefeller.

I don’t know how I’d manage with a 50% reduction in income even with the 3 year buy down. I suppose, like many others, I’d be looking at a new line of work or a new job, just like Jerd0708:

I have been on the hunt for a new employer. Going well. I think I am going to take the buy out either way. I had a real nice interview with a forging / machining company out in Wayne. My pastors brother in law works there and loves it. They have been looking for CNC experienced guys to start up a new machining building. They can only handle about 20% of there work there right now so they are building a huge new building with all new equipment to bring all the work back in-house. Good money and they just got a huge contract with a wind mill company making rings for the shafts and generators. They are 100% non automotive. Quarterly bonuses to the workers and great benefits.

Another company I have been dealing with is in South Carolina. Had two phone interviews and now they are flying me down for a plant tour and sit down on Tue the 13th. I really like this company too. They are a German firm that make Engines and Crankshafts. Huge in Germany. They have a lot of new equipment. They are offering me a shift leader position. Money will be close to what I was making Pre-Strike. All Benefits and a lot of time off. Wife really wants to stay here but is cool with leaving too.

Voting on the contract is taking place today, so we should know tonight if the contract has been ratified. I’m very happy that they might be going back to work this week, but I still have to say that this is a really awful pill to swallow. For those choosing to go down the path that Jerd0708 has now chosen, there are profitable forges in the States doing good precision work with owners who aren’t trying to reap for themselves on the backs of their workers. Unfortunately, AAM isn’t one of these companies and Dick Dauch isn’t one of these owners. For me, it really all comes down to Dick’s entitlement mentality; he’s entitled to all of it and hell with his workers.

So, would you vote for this contract?

By uniongal (aka bendygirl)
crossposted on Dailykos and Uniongal

Obama made his first public comments about the American Axle strike last Thursday in Macomb and then, suddenly, there’s an agreement. I highly recommend seeing the video and listening to what he says about American Manufacturing jobs:


Let's take a look at the “agreement” Mlive has the skinny:

DETAILS OF THE DEAL
Details of the tentative agreement between the United Auto Workers and American Axle and Manufacturing Holdings Inc.:

WAGES: Varies by factory location. Production workers in Detroit would see pay cuts from $28 per hour to $18.50, up from $17 the company was offering. Factory support workers would make $14.35 in Detroit and $10 per hour in Three Rivers.

BUYOUTS: Workers with less than 10 years of seniority could get $85,000 to leave the company. Those with 10 or more years could get $140,000.

PLANT CLOSINGS: Company will close forges in Detroit and Tonawanda, N.Y. No date was revealed for the closures.

EARLY RETIREMENT: Workers who are 60 or above with 10 or more years of service could get $55,000 to retire.

BUYDOWNS: Workers would get three annual payments to make the transition to lower wages. The maximum amount would total $105,000.

BONUS: Workers would get a $5,000 signing bonus.

THE VOTE: Starts Monday at some UAW locals. A large local in Detroit votes Thursday.

The “deal” is pretty darn disappointing especially in light of American Axle’s profitability, rare in the GM spin-off companies. So, let’s take a look at the striker’s reactions from the AP to step up their coverage of the American Axle strike:

After the meeting, Adrian King, outgoing president of UAW Local 235 in Detroit, said the session didn't go well. Workers were angry about the deal, and their frustration was compounded by a malfunctioning public address system that hampered questions from the crowd.
"We had a lot of angry brothers and sisters," he said. "It's definitely a hard-looking contract, very tough pill to swallow for the membership."

>snip<

Most workers leaving the meeting Sunday predicted the vote will be close. One worker tossed pages of the summary into the air as he walked out.

"There will be a lot of unhappy people," Reed said as he carried a picket sign outside the school. "But I think it's going to be accepted."

Today, American Axle workers are voting on this “deal”. From Mlive for some, it’s good news like:

Jeff Claussen, 58, of Three Rivers, said he is prepared to take a buyout and will retire after 28 years at the Three Rivers plant. His 59-year-old wife, Ruth, retired last year.

"If you prepared for retirement, and we have for the past 20 years, then I guess you're all set," Claussen said.

For some, it’s really bad news (from AP)

I'm voting no. It's totally unacceptable," said Gary Reed, 52, of Warren, who criticized American Axle Chairman and CEO Richard Dauch for making millions while asking production workers to take a pay cut from $28 per hour to $18.50.

"It's a slap in our face," Reed said. "We've been watching this guy making millions and millions of dollars even while we've been on strike, and were going to accept a stab in the back and just walk away with a smile on our face?"

And for others, it’s a mixed bag, from Freep

"I feel like I'm done, but I have no choice," said Tod Rippe, 43, of Dearborn. He said he plans to accept a buyout and may move out of Michigan. "It's a nightmare. It really is."

Mike Ulicne, 39, of Trenton said the contract would be tough to accept.

"I'm relieved, but not happy or satisfied," Ulicne said.

>snip<

Terasiena Cunningham, 36, of West Bloomfield started a similar chant for workers gathered outside the school.
Cunningham said she feels workers gained little, if anything, by going on strike.

"We can get better than this," she said. Cunningham also said she wished the two sides had extended the contract that expired Feb. 26, allowing workers to stay at their jobs as negotiations continued.

Former Local 235 UAW Vice President Erik Webb, 39, of Detroit said a much calmer meeting was held Sunday afternoon at the Local 235's union hall in Hamtramck, and predicted the contract would pass.

"Everybody who has been out on the picket line has been frustrated. People are ready to go back to work," Webb said. "We didn't really get what we wanted to get, but something is better than nothing."

>snip<

"Most of us are at a point where, financially, we are so ruined that this contract beats being homeless," said Michael Dudun, 46, of St. Clair Shores.

Workers at American Axle are hurting and some are willing to vote for anything. After 11 weeks (Wednesday marks 12 weeks out), it’s understandable. Again, from Mlive

Local workers have been living on $200 a week in strike pay. Many workers who said they were unhappy with the settlement said they would vote for it anyway.

"It's just a nasty situation," said Curtis McCall, 45, an American Axle worker who attended an informational meeting Sunday in Detroit. "You almost have no choice. If you vote no, then really you're out in the cold."

Workers will see their wages slashed under the deal.

A 54-year-old worker from Lockport Township, who declined to give his name, said he will see his pay drop from $27 an hour to $14.50. The 15-year employee said Sunday he hadn't decided how he would vote.

"We're putting one of our trucks up for sale, I've sold some scuba equipment on eBay -- but I just don't think we can adjust to such a drastic rate in pay," the worker said.

The summary of the contract distributed by the union said there will be buyouts of $85,000 for someone with less than 10 years with the company and $140,000 for a worker with more than 10 years. An offer of a $55,000 early retirement bonus also was included in the proposed contract.

Workers would get a wage "buydown" of up to $105,000 paid over three years to help ease the transition to lower hourly pay. The size of the buydown would vary with the size of a worker's pay reduction.

It’s even tougher to swallow a contract like this when you know that Dick Dauch will be shelling out nice bonuses to himself again next year.

But then again, what can we expect in this day and age? The haves like Dauch can reap $10 plus millions dollar compensation packages while the working stiff gets a whopping $14 to $17 an hour. Seems an awful lot like the times of the Robber Barons and I for one don’t want to return to the days of ole and the likes of Carnegie and Rockefeller.

I don’t know how I’d manage with a 50% reduction in income even with the 3 year buy down. I suppose, like many others, I’d be looking at a new line of work or a new job, just like Jerd0708:

I have been on the hunt for a new employer. Going well. I think I am going to take the buy out either way. I had a real nice interview with a forging / machining company out in Wayne. My pastors brother in law works there and loves it. They have been looking for CNC experienced guys to start up a new machining building. They can only handle about 20% of there work there right now so they are building a huge new building with all new equipment to bring all the work back in-house. Good money and they just got a huge contract with a wind mill company making rings for the shafts and generators. They are 100% non automotive. Quarterly bonuses to the workers and great benefits.

Another company I have been dealing with is in South Carolina. Had two phone interviews and now they are flying me down for a plant tour and sit down on Tue the 13th. I really like this company too. They are a German firm that make Engines and Crankshafts. Huge in Germany. They have a lot of new equipment. They are offering me a shift leader position. Money will be close to what I was making Pre-Strike. All Benefits and a lot of time off. Wife really wants to stay here but is cool with leaving too.

Voting on the contract is taking place today, so we should know tonight if the contract has been ratified. I’m very happy that they might be going back to work this week, but I still have to say that this is a really awful pill to swallow. For those choosing to go down the path that Jerd0708 has now chosen, there are profitable forges in the States doing good precision work with owners who aren’t trying to reap for themselves on the backs of their workers. Unfortunately, AAM isn’t one of these companies and Dick Dauch isn’t one of these owners. For me, it really all comes down to Dick’s entitlement mentality; he’s entitled to all of it and hell with his workers.

So, would you vote for this contract?

By UnionGal (Aka, Bendygirl)

General Motors said Thursday that it had agreed to give as much as $200 million to a parts supplier, American Axle and Manufacturing, to help settle a 10-week strike that has reduced or halted production at 32 G.M. factories.

About Freaking time!! Way to step up GM, way to freaking step up!! More from the New York Times

G.M. said in its filing that the deal to pay American Axle was reached recently but did not say when. A spokeswoman for American Axle, Renee Rogers, said, “This is sort of a breaking news situation. It happened very quickly.” Ms. Rogers said a deal to end the strike was not imminent but that “multiple” issues had been resolved.

Of G.M.’s cash infusion, she said, “It makes us hopeful that the parties can quickly reach an agreement to bring an end to the terribly costly and disruptive strike.”

Gee, GM, it's about time you realized how costly this strike has been. For the workers, it's been even worse as Food Pantries have run dry all over, take the report from the Toledo Blade:

Linda Crouch-Roepken, associate executive director of The Foodbank, said the strike has raised demand and lowered donations. She said the hardest hit food pantries have been AFL-CIO satellite sites, including one spot where 300 people picked up food a recent day.

"We have been able to address the need, but it has been a strain on the entire network," Crouch-Roepken said.

So, to sum this up, way to finally step up PUBLICLY GM, now Dick Dauch, stop being a freaking dickhead and let your workers return to work based on a FAIR CONTRACT. All workers should be able to put food on their tables and also into the pantries, too.

Lockhart says all the talk about pay cuts and buyouts is upsetting, but he has to prepare for the inevitable. He doesn't want a pay cut, but he also wants to go back to work.

"I guess that's what it's going to be," he said. "I refuse to stay mad and make being out here even worse."

And right now, with this GM proposal, I finally have my fingers crossed and I'm holding my breath that this might really be near the end of this strike. It's still not good enough, I'm sure it isn't good enough for Lockhart or Jerd0708 or any of the other American Axle workers out on the lines right now, but it's movement on the strike. And that to me, it's a good sign.

By Bendygirl

Crossposted on Women, Unions and Our Stories

From the Boston Globe (Boston.com)

Tony Pasuy has worked as a skycap for American Airlines at Logan International Airport since 1993 and says he always loved the job. Dressed in the airline's trademark blue-and-white uniform, he helps travelers check in luggage outside the terminal, hoists heavy suitcases onto carts, and guides people in wheelchairs. Many passengers apparently liked him, too, giving him about $200 a day in tips, he said.

My mom’s a waitress and I put myself through college waiting tables on the graveyard shift. When you work for less than minimum wage, tips can make or break you. For Pasuy, it meant $200 a day in income to feed his family, put a roof over his head, maybe pay for medical bills or vacations or maybe even school clothes for kids. Basically, $200 a day meant that he could provide for himself and his family.

WELL, that is until American Airlines started to charge $2 per bag, that’s when all hell broke lose. Again from the Globe:

But American Airlines says it has done nothing wrong. It points out that signs posted at curbside kiosks say the fee excludes gratuities. The carrier says in court papers that it imposed the fee at Logan and other airports after losing $821 million in business in 2004 and contends that declining air travel after 9/11 may have caused tips to fall.

The airline is also challenging the credibility of the skycaps. Under questioning by lawyers for the airline and the skycaps, Pasuy acknowledged that he failed to report his tips to the IRS in recent years and said he earned only $8,001 in 2006, far less than his actual income.

Several airlines - including United, US Airways, and Northwest - began charging a baggage fee in recent years, but the suit in US District Court in Boston is the first to challenge it, Shannon Liss-Riordan, a Boston lawyer for the skycaps, said in an interview. Her firm is helping to prepare a similar suit against US Airways, she said.

Isn’t that sweet of American Airlines? Pointing out that tipped employees don’t declare all of their income? I think it’s so sweet. I know that when I waited tables I declared every penny because come tax time, there’s nothing like getting screwed for working without benefits, sick leave or adequate pay. Of course, American Airlines could just provide adequate pay and benefits to the skycaps to make up for the loss of the income, or, they could just fight them in court, instead. Which do you think they chose to do?

Tim Smith, a spokesman for Fort Worth-based American, said the carrier "is disappointed by the verdict and the amount awarded" and is evaluating its legal options.

So, the skycaps sued over their lost income and THE SKYCAPS WON!!

A federal jury in Boston on Monday determined that American Airlines (AMR) diverted more than $325,000 in tips from nine skycaps over the past two years since it imposed a $2 fee for curbside bag checking.

Steven Pearlstein at the Post linked this story to executive pay excess, you know, like the 10.5 million package that Dick Dauch issued to himself last year while asking his hourly employees to take a 50 to 60% pay cut this year? Well, Steve had even more scathing reviews of other executive excesses, let’s take a look:

This is not just another story of the incredible stupidity of airline executives and their willingness to sacrifice long-term customers' satisfaction and loyalty to short-term financial pressures. It is also a story of rank hypocrisy. It is these same airline executives who are constantly defending their own generous pay packages -- and those of other corporate executives -- by arguing that you can't retain and motivate key executives if they don't have the carrot of bonus pay dangled in front of their noses at all times.

That's certainly the approach being taken by Washington Mutual, the country's largest thrift, which was to the no-money-down, no-documentation mortgage loan what Drexel Burnham Lambert was to the junk bond. Now WaMu, as it is called, expects to write off $12 billion in bad loans when all is said and done. Its stock price has declined 70 percent over the past year.

Given those dismal results, it seemed only fitting that chief executive Kerry Killinger decided to forgo taking the $1.2 million bonus that he was entitled to under the company's executive compensation plan last year, settling for a measly $5.3 million in cash and stock. Other executives typically saw their bonuses cut in half.

Next year, however, things will be different. According to the company's recent proxy statement, WaMu's board of directors has decided that the bonuses for Killinger and 3,000 other top executives will be based not on net income, as is customary, but operating income, along with cost containment, fee income and customer loyalty -- all criteria that just happen to ignore the disastrous loans of the past. The board's rationale is that the point of the bonus program is to keep executives focused on improving the company's performance going forward. Or to put it another way: There's nothing we can do now about their past screw-ups, but the important thing is always to keep the carrot dangling in front of those donkeys up in corporate.

These two stories -- the one about the airline porters and the other about the WaMu executive bonus plan -- provide a window into the hypocrisy that permeates corporate thinking about incentive pay. The twisted logic goes something like this:

When times are tough, it's okay to rob the tip jar of front-line employees to make sure that there's still plenty of change in the tip jar of millionaire executives.

(EMPHASIS MINE)

Steven, you should have added Dick E Dauch to this list of out of touch executives ready and willing to rob their employees, it would have been just another very clear example of rampant hypocrisy in US executive pay.

As for Mr Pasuy and his 8 other co-plaintiffs, congrats. Hope you’re not able to make this a class action suit on behalf of all sky caps. It’s about time we had better Robin Hoods to match wits with the Robber Barons of these times.