Goodyear

As a follow up to a previous post - http://givemebigmoney.blogspot.com/2007/03/guerilla-recruiting-goodyear.html

Here is an excellent example of a company who puts the shareholder above the employee. Of course, the president owns quite a few shares so the decisions made by the Board that he is on impacts him in a positive way. To top it all off, Goodyear is on Fortune's "Most Admired Companies" list. Their industry rank for people management is 2nd! After reading this story, you decide if they really are doing a good job for their employees or a better job at brainwashing the public.

Goodyear Tire & Rubber Co. (GT) Chairman and Chief Executive Robert J.
Keegan received executive compensation valued at $11.7 million during 2006 even though the company lost $330 million last year. Yes, a 3-month strike contributed to this loss, BUT when a company decides to do away with their pension and make retiree health care more expensive, do you think a CEO deserves $11.7 million?

Keegan received a base salary of $1.13 million, a bonus of $2.24 million (for losing $330 million), equity awards valued at $220,800 (nice bump in net worth from cutting benefits for the employees) , and $8 million through Goodyear's executive performance plan ($8 million on a performance pay plan.....for what?) for the period Jan. 1, 2004, through Dec. 31, 2006.

When the company loses a good portion of their talent pool and doesn't perform as Wall Street expects, what's next? A big fat severance package? And how will they pay for that?

He also received other compensation worth $93,377. This includes $32,760 for a
home security system installation and monitoring expenses, as well as the cost
of an annual physical exam, personal use of company aircraft and annual dues
for club memberships. Again, Goodyear did away with their pension plan for non-union employees and increased the cost of retiree health care. Perhaps the CEO could have taken a cut in pay and eliminated some of his fringes to save the company some money rather than shoving all the costs to the employees. What kind of message does this send to his current and former employees?

Here is what the company is changing for the employees. Make sure you read the quote below about retaining talent.

 Benefit plan changes effective Jan. 1, 2008, include:

-- Increasing the amounts that current and future salaried retirees
contribute toward the cost of their medical benefits,
-- Redesigning retiree medical benefit plans to minimize cost impact on
premiums,
-- Closing the company's Medicare supplement plan to new entrants and
-- Discontinuing company-paid life insurance for salaried retirees.

The   pension changes include:

-- Freezing the current salaried defined benefit pension plans as of Dec.
31, 2008,
-- Replacing the defined benefit pension plans with enhanced 401(k)
savings accounts with varying levels of company contributions for
current associates beginning Jan. 1, 2009 and
-- Introducing company-matching contributions for the salaried 401(k)
savings plan at 50 percent of the first 4 percent of annual pay
beginning Jan. 1, 2009.

"These changes allow us to continue to provide the kind of compensation packages that are competitive and will attract and retain talented associates," said Kathleen T. Geier, senior vice president of human resources.

Really? So the company is going to reduce the compensation and benefit packages to save $90 million a year and they expect to attract and retain talent. Wow! What part of this math equation adds up to more for the employee that will make them want to stay? As far as attracting employees, if a company is "struggling", why would someone want a job at Goodyear? When they fail to please Wall Street, what will they cut next?

Brainwashing or looking out for their employees? You decide.