No Pay Cut for Mike Z.

By Mark Evans | Published: February 10, 2009

So, let me get this right: Nortel plans to lay off a lot more people, and has cut the severance payments from people who have been laid off recently BUT CEO Mike Zafirovski seems unwilling to accept any financial pain himself?

In an interview with Ottawa Citizen, Mike Z. defended his 2008 salary of $1.2-million, and noted he and other executives would not be paid cash bonuses for 2008.

As I wrote recently, if I were Mike Z. and sensitive to the optics of what’s happening around him, I would declare that I would only take a $1 salary until the restructuring had been implemented.

In the scheme of things, it wouldn’t be a huge financial hit but it would a major symbolic gesture. At the very least, I’m puzzled by Mike Z.’s approach.

Then again, he also chalked up $137,000 in personal expenses related to his use of Nortel’s corporate jets.

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exnt2

any I Believe folks who would like to offer a 30% pay cut to put nortel back on track. if you believe how about defer this until nortel is the profitable company it never was again.
Tk910

Agreed. Exnt_x_2 – you really are assuming that those of us who are still here didn't feel a lot of empathy for those that left before us. It's been very difficult to watch people you love and respect find themselves left out in the cold.

Given the job market as it stands, and the lack of severance and out-placement assistance, this is a very bad time to be let go by Nortel.
exnt2

he did not cut exec pay cos joel said he would punch him in the face if he did.
less

“And, we are continuing to look hard at our cost base – to eliminate any unnecessary expenses, no matter how small”

Thats key right there: eliminate the unnecessary small stuff first – light bulbs, highlighters, disposable coffee cups, consumables, engineers, benefits, labs – then eventually work your way up to the big stuff – jets, campuses, and lastly them biggole salaries.
exnt2

dead on. when people were laid off before most would say thank god its him/her. theyd put on this charade of doing a lot of work and kissing behinds.

feel sorry for some of the good people but glad its these fakes with smirks on their faces.

“watch people you love and respect” what a whole bunch of crap.
exnt2

not to forget the hours they would put to figure out who might get laid off or who got laid off and why thy got laid off and which poor new grad should do the work freed up from the layoff and how they can manage this new grad.

buncha lazy powerpoint people.
Hotel_Notel

Let's make believe for an instance that I was CEO.

First, I would understand that I have a huge undertaking with the Chpt. 11 and restructuring on my desk. However, I would find it EXTREMELY necesary to speak to my remaining shareholders, customers, and most importantly, my employees, past and present, and try to comfort them and let them know everything.

Secondly, I would take the symbolic pay cut, no questions asked.

And lastly, I would start from square one, taking away all the unecessary fluff that has been attributed to my past (Six Smegma, Black Belts, and anything perceived as related to a BB project) and allow the remaining employees to do their jobs simply stated. No added reports, charts, fluff, or other data related BB crap. Bottom line, the employee, the customer, are all that matter. Direction from my team would start at the AGM, beginning with a succinct and direct roadmap for restructure and how it would affect each of us!

Sadly, this won't , can't and never will come true for all obvious reasons previously state on this blog.

BOD's need to wake up, walk away and give this company back to the ones who truelly care about it, the remaining core employees. (not to include the recently added staff in COe's due to their being responsible, not personally but rather due to their creation, for the current situation).
XPM_guy

“…he and other executives would not be paid cash bonuses for 2008.”

Note how carefully he qualified that statement: no cash bonuses this spring for 2008 work. That does not preclude cash bonuses paid this spring as part of the court approved KEIP, about which nothing has been said to employees.

So don't worry about Mr Z having to get by on only 20% of his normal pay package (i.e. just those $50,000 paychecks bi-weekly), because millions have been set aside for the KEIP, and that will surely make up for the lack of 2008 exec bonuses, especially since the KEIP pot doesn't have to be shared with any employees the way those performance-based 2008 bonuses he cancelled would have been…
XPM_guy

I would take a pay cut (e.g. work a shorter week) in a heartbeat to save the jobs of my co-workers, as long as there was some assurance that the money wouldn't just go into some exec's pocket on his/her way out the door.

At this point there's a trust issue involved: can we believe a word our “leaders” say anymore. While doubt remains, that makes it hard to commit fully and offer up our own pay to keep things afloat without any reciprocation (e.g. the execs would have to share the pain as well with $1 symbolic salaries), even if we do believe with all our heart & soul that Nortel can and should survive this dark chapter…
Tk910

Hey asshole – you don't have the ability to read minds, so don't comment about how other people felt. If you feel like everyone was blowing you off as you were shown the door, I'm sorry to hear that, but you've not a clue about what everyone else has gone through or thought. Jackass.
less

“No taxation without representation” – Nortel is taking your money to use as it sees fit, to keep business going, whatever that may mean this week. Now shut up and go away.
broadbandbill

Real leaders show up when trouble appears and stay there until it is gone. The cowards, they go into hiding behind emails, teleconferences and anything that is even remotely considered 'trouble-facing' because deep down inside they know they are COWARDS!!!
broadbandbill

You would because you have a conscience, Z doesn’t!..–bb
AnotherSlave

I think they should all go fix Peanut Corp of Am.
OneOfTheFewLeft

I'm pretty sure this is what Zeroman is actually thinking when he is writing those weekly Zmails

http://fakemikez.blogspot.com/
felixmk

I have translated from Zspeak to English:

Employee Peons and peasants,

Hear me for I am the mighty Imperial Emporer Z from the land of GE.

I will not be taking a pay cut but you will likely get laid off with no severance shortly.

I don't care about customers but if it makes you feel good, feel free to believe they still love us.

We are still going to Mobile World Congress even though we have no UMTS and little GSM business – its what we do to pass our time.

Our old “partners” like Alvarion are getting screwed like you, don't worry, be happy.

I want you to be happy while we plan to dump you. You are hereby ordered to feel good about me, my chosen executive flunkies, and Nortel. Anyone found not feeling good or participating in our next “Back to Jonestown” I Believe event will be laid off and dealt with harshly.

That is all

Imperial Emporer Z
1derY

You meant he has his monkey Alepian writing these Zmails for him…Do you really think Z is capable of writing letter like that ?

By the way, how many PR people do they have working on spinning out letters and fronting the media lately – Karen M, Big Mo. Mooka, Ronald Alpean, Jay Barta ????….and a few others perhaps. I'm sure these guys don't come cheap…

What a waste of time..should lay them off before the engineers.
LonelyOpsGuy

The reason why Zeroman does not speak and does not take the paycut is because Nortel's fate is chapter 7. So, why care?
http://nortelinsider.wordpress.com/ Desk Jockey

I agree 100%. There is no need for threats of physical violence against this man, no matter how much of a thug he is. I understand there is much enmity against him for obvious reasons but resorting to threats will not solve anything and may even make the situation worse. Having been the target of threats myself, I can say that I would wish it upon no one.

However, TIC I question your assertion that Mr. Evans “endorses these kinds of threats” I have yet to see a post by Mr. Evans threatening physical violence or death against Mr. Z unless you have read something I have not. Care to point me in that direction or give me a link?

Until you do, you cannot claim that Mr. Evans endorses this comment any more than he endorses yours. Does Mr. Evans speak for you and your views? Probably not so how can you say that he speaks for other commenters?
http://nortelinsider.wordpress.com/ Desk Jockey

Just hilarious! The only sad fact is that this is how Mike Z probably thinks internally in his head.
http://nortelinsider.wordpress.com/ Desk Jockey

Sadly, this is probably the case. They lied about Ch. 11, whos to say they aren't lying about Ch. 7 as well? If there's anything we've learned its that they have treated employees, shareholders and the public at large like mushrooms: Keep them in the dark and feed them you know what.
http://nortelinsider.wordpress.com/ Desk Jockey

Alepian has probably been let go. He had to be sacrificed for making the comment that “bankruptcy was not imminent” back in December. For this reason, I almost feel sorry for him, being manipulated and told to spread lies for the benefit of management.

A video has since emerged of how Nortel management handled the leak to the Wall Street Journal about their bankruptcy plans back in December:
http://www.youtube.com/watch?v=1b0-r1t-H1M
http://nortelinsider.wordpress.com/ Desk Jockey

Couldn't have said it any better. Cowards, liars and thugs, the lot of them. Their failures and mistakes were bad enough but yet they still have the gall to hide and shirk any shred of responsibility that comes their way.
http://nortelinsider.wordpress.com/ Desk Jockey

Right you are my friend. They have tried to keep KEIP and AIP under the radar all while requesting that the court approve it.

So, while Zmails harp on about “no bonuses” what they fail to mention (by design) is that KEIP will “keep” all the executives nicely pampered as they always have been, while they continue the relentless drive towards Ch. 7

Criminals by any other name!
French_Connection

In the Nortel press release on the 14 january……..

Nortel President and CEO Mike Zafirovski. “These actions are imperative so that Nortel can build on its core strengths and become the highly focused and financially sound leader in the communications industry that its people, technology and customer relationships show it ought to be. I am confident that the actions we're announcing today will be the fastest, most effective means to translate our improved operational efficiency, double-digit productivity, focused R&D and technology leadership into long-term success.

His email of the 6 Feb posted below he now says…..

“I know many of you also have questions around when we will have a finalized overall plan for review by our creditors and the courts. This is a simple question that does not have an easy answer. At this point in time it is extremely difficult to put any timelines around when the plan will be ready for review and then implementation. There are many variables and interdependencies that are still unclear at this point.”
RealityStrikes

Mike Z has learned from the best – Jack Welch:

http://fakemikez.blogspot.com/
ERworker

With my profuse apologies to the Beatles for associating their fine song to Z.

He's a real Zero man
Sitting in his Zero land
Making all his Zero plans for Nortel

Doesn't have a working plan
knows not where he's going to
Doesn't care about you and me
Zero man please listen
You don't know what you're doing
Zero man, Nortel is at your command

He's as blind as he can be
Just sees what he wants to see
Zero man, can you see me at all
Zero man, better worry
Out of time, please hurry
Keep hiding till somebody else
Shows you the way
Ah, la, la, la, la

Doesn't have a working plan
knows not where he's going to
Doesn't care about you and me
Zero man please listen
You don't know what you're doing
Zero man, Nortel is at your command
Ah, la, la, la, la

He's a real Zero man
Sitting in his Zero land
Making all his Zero plans for Nortel
Making all his Zero plans for Nortel
Making all his Zero plans for Nortel
ExNtrl

I am sure both of you are correct and that Mr Z is using skilled tax preparers the same as Daschle when he missed the use of the car service
http://www.usatoday.com/news/washington/2009-01…
Out of curiousity are these the same company auditors that were used for the multiple restatements over the years?
DeadManWalking

I'd like to see KEIP replaced with CHOP…. CEO Headed Off to Prison.
http://nortelinsider.wordpress.com/ Desk Jockey

Here's one more:

“Z-man” (To the tune of Taxman)

Let me tell you
How it will be.
There's none for you,
1.2 million for me

'Cause I'm the Z-man.
Yeah, I'm the Z-man.

Should 2 weeks notice
Appear too small,
Be thankful I don't
Remove it all.

'Cause I'm the Z-man
Yeah, I'm the Z-man.

If you have severance
Say goodbye to it.
If you have a pension,
You'll take a hit.
If we own you money,
Too bad for you.
If you're a shareholder,
Well screw you too.

Z-man!

'Cause I'm the Z-am.
Yeah, I'm the Z-man.

Don't ask me what I want it for,
(Uh-uh, Nortel!)
If you don't want to lose some more!
(Uh-uh, Nortel!)

'Cause I'm the Z-man.
Yeah, I'm the Z-man.

Now my advice for those let go,
(Z-man!)
Sorry you have nothing to show!
(Z-man!)

'Cause I'm the Z-man.
Yeah, I'm the Z-man,
And you're working for no one but me.
(Z-man!)
broadbandbill

Brilliant and spot on; wish I had thought of it…–bb
Another_Nortel_Watcher

For f's sake, why doesn't MZ go? As a CEO, he has failed and destroyed Nortel. He has nothing up his sleeve to turn things around. As part of his failure, he has betrayed the Nortel employee base, present and past. Trust and loyalty are gone. Mike Z is hated by everyone and respected by nobody. Why does he stay???!!!!

MIKE Z – GET OUTTA DODGE!!!!!
broadbandbill

My comment on 'Fake Mike Z' (I just love the concept)…–bb

“Dear Mike,

Thank you, thank you and thank you one more time. Until your corporate brilliance showed up I was the poster boy for the proverbial ‘corporate empty suit’. Imagine that; I paved the way for (the real) Steve Job’s glorious comeback and I am the BAD guy? Ungrateful SOBs, all of them. Anyway, please don’t do business with that cancer-laden hippie; your cancer is all we need.

Continued success,

John Scully”

Link to post:

http://fakemikez.blogspot.com/2009/02/im-leadin…
broadbandbill

Cause he's the 'Fake Mike Z”; don't you get it?–bb
Another_Nortel_Watcher

I guess not. I just can't get over how much damage the guy has done and is doing.
rfc1149

This is probably the most ridiculous thing I have ever read.

'Sorry Mrs. Hossenfeffer, you're husband died in the operation but look at the great job I did suturing… I won't be asking for a tip!'

Ummm $50 million is 'big number' for a $10 billion/year company!? Dude you do have a math degree, does 'statistically insignificant' ring a bell? And dude, you already took $37 million of it.

I remember reading an early interview (can't remember the link sorry) where he said he did not believe in the CEO/COO model. I now understand why. MikeZ does not understand the difference between the jobs (other than the much larger paycheck).

If you are CEO of a company where 1/2 revenue and 200% of the profits are about to evaporate, you do not spend the bulk of your time eking out a .5 percent increase in a 'non-GAAP' (aka bogus) accounting measure. Hiring somebody two levels below you to do so might be warranted.

Had Nortel had a CEO with the slightest understanding of the telecom business, 50 million would come from 1 half-way successful new product. This would also grow the business, reducing lay-off expenses, etc.

Glad to get this off my chest, thanks Mark for this forum.
LonelyOpsGuy

Found the source of the ZMails:

http://www.erikandanna.com/Humor/bullshit_gener…
LonelyOpsGuy

BINGO!
LonelyOpsGuy

LOL
broadbandbill

Agree, was only jausting…–bb
scalpcutter

Paycuts are for suckers.
Cut your pay go on pogey, welfare and binge drinking.
Its the canuckistan way.
That's what the feds and McDicky want.
less

Hm. Looks like its high time for certain people to ride on the Peace Train to NYC and admonish another stodgy holdover from the Cold War who is blatantly, selfishly, desperately cynically attempting to incite violence and anarchy just as the New World Order (peace be upon Obama) is finally within the Proles' reach:

http://www.cnn.com/2009/US/02/11/amputee.housin…

“WALL STREET CAN GO STRAIGHT TO HELL”

Luis Caplan served the poor of the South Bronx for decades out of a small medical office. His leg was amputated after a bout with cancer in 1990, yet he continued to work for another five years.

Luis Caplan, 71, asks of the stimulus package: “What happens to the real middle class?”

Now, his savings have nearly been wiped out because of the economic crisis. At the age of 71, he faces losing his apartment if things don't change soon. The government bailed out the big institutions, but “what happens to the little people?” he asks.

“I don't know how much more I can go through like this,” he says, sobbing even more. “I'm going crazy with this.”

Located in a tony neighborhood in Manhattan's Upper East Side, apartments used to sell in a matter of weeks. Caplan has dropped $50,000 from the original asking price of $625,000 and may have to drop the price again.

Living in a tony $625,000 home constitutes “hardship”? Somebody please wheel this whiner down to NYSE and buy him some NT stock to shut him up, already.

Oh, wait…
cassidythedog

Best line from the article:

“We were in a perfect storm and we were not on strong footings to begin with,” he said.”

translation:

“It’s not my fault. Why do you guys hate me so much? I didn’t do anything wrong. It’s really not my fault!!!!”

No raise in 3 years?!? If you check the filings for 2007 he got a raise (30 or 40%) then.

It just keeps getting more and more depressing!
cassidythedog

Nice choice for a user name. May also want to check rfc 3092 as a good name for this forum.
TongueInCheek

Mr. Evans is the Blog Owner and as such has editorial rights to accept or deny any post made to this blog. You're correct in saying that he personally has not posted threats against Nortel people.

However, I do find it fascinating that a person who markets himself and his consulting company as a Social Media Expert would permit Threat Posts on this blog. To me, that doesn't make good marketing sense for a person wanting to sell his expertise.
yes4aapl

http://disqus.com/people/Theleftbehind/#main
From: Mike Zafirovski, CEO (TORWM:8442)
Sent: Friday, February 06, 2009 4:51 PM
To: Nortel employees
Subject: Message to Employees
..cut
However, in parallel to the ongoing work in the businesses, there is still much that is in flux as we advance the restructuring process. What I do know for sure is this: Nortel is going to change significantly in many ways. We are going to get smaller. And that will impact people. But, we are also going to get leaner, more agile and more responsive. We must create a cost structure that is aligned with our revenue base and our investment plans for the future. As we discuss and review with our creditors, we will know more, and tell you more.

So, what's next? First, we need to continue to stabilize our business and our customer base. Second, we will be ramping up the planning phase as the creditors' committees come together and we look to develop the go-forward plan for the company. Throughout this, we will be continuing to focus on reducing costs across the business, as virtually every company in the world in virtually every industry is doing today. All of these measures together will lay a path for the future that is sustainable and affordable.

Yes, we will be transforming Nortel again – more decisively than probably at any time in recent history. We are doing this in a tough environment, in a tough marketplace, and – hardest of all – with tough impacts to Nortel employees.

We must do this to ensure we are able to continue serving our customers so that they can make it through these times. We must also move forward in a way that will preserve our innovation, our know-how and the capability that is in our people. This will be challenging.
cut
Mike
cut
===================
reply to Theleftbehind

Let me tell what it means
Mike hinted it'd be New Small Nortel after all.
How new can NSN be or how small?
Where Nortel will house 6000 R&D employees from the sold campus in Ottawa?
Not sold yet?
Nortel is not going to house all 6000?
OK
How many of them will be saved? 2000 or less?

Mike plays his game of holding all parties hostage.
He’d cut 60 to 75% workforce but as long as there is no leak; every employee has to play his game too, pretending they Believe! Will Nortel fire rightful critics and keep Believers and Optimists who think Nortel is a leader in the market and all critics are the cause of Nortel's troubles?

Mike is focused to stabilize customer base. How?
It's been more than 2 months since Nortel hired BK experts to make plans and customers have been watching that horror movie. What sales people would sell in that time? Few BCM450 for few thousand $ each? What was Mike's message for customers in his zMail? The message was, stay tuned because you can be the lucky one to be served next year as 60-70% others would have to replace Nortel's gears sooner or later.
The most disgusting is that the guy who failed miserably to fix anything is still torturing all parties with his zMails!
Give it up Mike!
$1 mill doll a month for jets vs $200 k a year for all innovations; that alone shows how greedy and blind you have been!
You were spending 60 times more for jets than for innovation; that’s the simple calculation.
How did you expect to spark innovation in your company?
longgone

Zschitt continues……my condolences to those who still must contend with him
less

Seriously now wheres the threat? And why is the poster not being addressed directly?

Mike Z is showing, well, Zero expertise at marketing Nortel at insane cost to thousands. He's got fans and volunteer bodyguards working for free to protect him from harm.
Another_Nortel_Watcher

Mike Z doesn't understand the difference between CEO and COO yet he employs a COO anyway? Sigh.
less

Looks like they gave at the office:

http://www.campaignmoney.com/political/committe…

Top 100 Donations/Contributions in the '08 Election Cycle to
NORTEL POLITICAL ACTION COMMITTEE

Name/Location Employer/Occ. Contribution $ Amount Primary/General Date

Hackney, Joel Durham, NC 27709 Nortel/Executive $5,000 P 12/05/2007
Zafirovski, Mike Schaumburg, IL 60173 Nortel/Ceo $5,000 P 11/26/2007
Lasalle, William Barrie, On Canada, ZZ Nortel/Counsel $1,500 P 11/26/2007

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