We Want Our Bonuses!

By Mark Evans | Published: March 19, 2009

To keep the senior management team engaged during Nortel’s restructuring process, Nortel is seeking court approval tomorrow to approve US$23-million bonus plan. This comes on the heels of court approval earlier this month that approved a $22-million incentive plan for about 880 employees.

Canadian Press has more details, while I did a blog post on the incentive programs last month – AAN post.

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  • gone2moro

    In two years no one will remember this… or Nortel….

  • NTblinker

    $1 M for top execs(23M-22M).

  • tiredofitall

    I hear the argument they are presenting on court for this is that it will help employee morale! Is it possible to be so out of touch, or is the morale thing a big fat lie and they didn't think “we're really damned greedy” would make a good argument in court?

  • PM_Guy

    I hope the judge has been watching the news. IE: AIG

  • CrazyCanuk

    Yet another clear example of how the GEniuses have absolutely no interest in Nortel as a company and even less concern for its employees.

    They're just here to loot and pillage.

  • NTblinker

    Suggesting tax cuts(zero) for only Nortel products and BONUSES also to survive Nortel.

  • NTblinker

    No one will forget Nortel due to it is creating a security flaw in employees DNA.

  • One_way_ticket_to_Chapter_7

    I bet the terminated employees who weren't given severances will remember

  • NTblinker

    wrong. pls ignore this

  • BelieveIt

    Apparently, a member of Nortel's Board has been appointed Under Secretary of Energy in the US.
    http://www.jhu.edu/~gazette/2009/16mar09/16john…
    Wonder if they know about her “work” at Nortel

  • NTblinker

    Nortel's board members mostly appeare in the White House. Actually, a dozen people are managing all of the US firms or tech sector.

  • DRP666

    Some nerve considering all the bad press AIG got this week. I thought their CEO was gonna break down and cry at the senate hearings. Sounds like the AIG CEO and other management were getting death threats about the bonuses…but nothing scares ZMan I guess.

  • The psychiatrist

    You know what-this bonus plan is absolute BS,just like AIG these scumbags are using the excuse that bonuses are needed to keep these executives around.

    It just goes to show that these idiots are not living in the current reality-they say they need to give these bonuses in order to prevent executives from jumping ship,well in this economy I highly doubt that there will be other companies ready and willing to hire executives with bonuses to match the ones being offered by Nortel's KEIP or those of AIG.

    Furthermore both Nortel and AIG are both in critical condition and the thought of bonuses being given out at a time like this is just utterly obsurd,these employees from both Nortel and AIG should just be happy that they still have well paying jobs when millions of people are either losing theirs,losing their homes,their pensions etc….

    Mike Z and the rest of you idiots-WTF up and earn respect for once and stop being shameless pigs!

  • TongueInCheek

    At the risk of being flamed, the Nortel and AIG cases for executive bonuses are completely different. Nortel is not paying bonuses using government funds.

    However, I do not want to see Nortel Executives receive significant bonuses with a couple of caveats.

    - Any Nortel executive eligible to receive funds as a result of Change In Control, should not receive any retention bonus.

    - I do think that Pavi Binning should be considered for some level of bonus with very strict conditions. He is the one person fundamentally responsible for the Business Plan, Restructuring Plan and negotiations with Creditors etc. He shouldn't get money just for “being there”, but I would understand funds being specifically assigned should Nortel restructure without liquidation or Chapter 7 proceedings.

  • less

    Many employees canned without severance were mini Pavi Binnings in their respective fields. So -?

  • The psychiatrist

    At the risk of being flamed, the Nortel and AIG cases for executive bonuses are completely different. Nortel is not paying bonuses using government funds.

    Either way bonuses are usually associated with work or performance well done,and Nortel's current situation is a far cry from that measure.

  • DRP666

    Need to look at it this way, government is having pay thousands of people Unemployment insurance (taxpayer money) and missing out on 30% taxes on severance….so bonuses are related to taxpayer money the way I see it…..

  • http://nortelinsider.wordpress.com/ Desk Jockey

    The ONLY difference between AIG scum and Nortel scum is that the loser executives at Nortel only have access to the Nortel coffers to pleasure themselves with!

    Don't believe for even a second that they wouldn't do the same as AIG and help themselves to even bigger bonuses if Nortel was given a goverment bailout.

  • http://nortelinsider.wordpress.com/ Desk Jockey

    Well said, with KEIP it is clear that the Nortel execs have the same mindset as the AIG ones. Clearly they are in it for themselves and don't give a damn whether the company survives.

    As one news story so aptly put it: These guys are doing what they do best, looting the corpse.

  • http://nortelinsider.wordpress.com/ Desk Jockey

    Zman can put that on his resume, “capable of making the tough decisions no one with a conscience would”

  • RealityStrikes

    Here's hoping that Judge Gross will reject this gross (crude: conspicuously and tastelessly indecent) request!

  • FalseProfit

    You always seem to find a way to put a Nortel spin on things.

    I can think of one major difference between the AIG & Nortel; the AIG CEO is working for $1 to help clean up a bad situation. He inherited the problem.

    Mike Z used to blame conditions on what he inherited but made things worse under his 3 – 5 year plan and now wants to blame the situation on the economy.
    Mike Z is still receiving full salary and is the only one not on the bonus plan “for now”. Most of this elite club already get huge salaries and they also have some guaranteed exit money that will probably be paid despite Ch.11 & CCAA. The board has also swapped worthless stock for cash payments.

    Anyway you slice it, it represents greed and shows that they are out of touch with the average employee, shareholder, or customer. As someone put it, WTF up!
    If this select group is so committed to seeing Nortel through this filing as they preach, why does their need to be retention money on the table.

    It's time for less carrot and more stick…or shoes thrown at Z Man.

  • RamblingFish

    Setting aside the Exec Incentitive program for a moment, have the 880 “key employees” been notified they are such? And if so, how many of the truly key employees that weren't on that list (probably because they did do enough kissing up to their local exec) will finally take the hint to get out?

  • tiredofitall

    Fix the company as promised then get your bonus SLT. It's that simple. A lot of us work hard, and a many (all) struggle with morale.

    Suck it up and get to work. Use that money to help the business. You'll sleep better at night, honest.

  • Another_Nortel_Watcher

    Unbelievable. I guess proper due-diligence wasn't done.

  • exnt2

    I hope the courts do not approve. Then lets see how many of these people jump ship. Sure they can but who would be willing to take them. Execs are dime a dozen right now.

  • broadbandbill

    Once again I find myself quoting HRCE (Happily Retired Cisco Executive) who posted only a few posts, in which he noted: “The only way Zafirovski goes out is feet first; he will milk the company for every cent until there’s nothing left” (paraphrasing). I agree!…–bb

  • http://nortelinsider.wordpress.com/ Desk Jockey

    Agreed they are just looting the corpse right now.

    And read this story:
    http://www.cbc.ca/money/story/2009/03/19/nortel…

    ———-
    Nortel spokesman Mohammed Nakhooda declined to comment specifically on the proceedings, but noted that… “This is in line with how other companies manage through a restructuring,”
    ————

    In line with how other companies manage, you mean like AIG? These scumbags just don't care anymore.

  • scalpcutter

    Not only that but these creeps jumping ship would have no impact on performance but it would improve the bottom line.
    Best they go. More money for the peons who do the real work.
    Execs and Managers are a dime a dozen. One as useless, politically correct and old boys club disoriented as the next.
    The Sooner Nortel realizes that the more likely the restructuring plan works.
    These execs/managers offer no value. They make morale worse and they've done nothing to promote Nortel or deliver on the excellent work done by the rank and file over there.

  • tryn2makealivin

    It is the tax payers money to a certain extent. Who is the largest Debtor? IRS 16 Million dollars and they are not paying many other vendors who feed the tax base.

  • Anonymous

    I wont’ trivialize the plight of the forelonehopes…. I am one of them. I’m fighting the good fight to get my severance. But in the end I don’t think i’m going to see a dime. and bitterness, hate and anger are poison. It will rot your core and impact your family life and new work environment. 2 years is a long time…. where were we two years ago…. imagine where you will be in 2 years to come. Not worrying about this crap I pray.

  • longgone

    the Zcrew have no souls

  • Cataractus

    It's just another ploy from the Z-crew to extract every dime of pay they possibly can. Bonuses are unneeded to keep Hacker, Lowe and crew because nobody in their right mind would ever hire these bozos. Their “bonus” is the fact that haven't already been pushed out the door. And the bonus benchmark criteria are a joke that have NOTHING to do with actually nursing Nortel back to profitibility. Benchmark 1 (“cutting cost”) is super easy to meet – fire more employees without severance. Once again greed triumphs over shame.

  • 4merEmployee22

    Is this why they stop the “Retirement Allowance Plan” money, so that the
    company can divert the funds to the other 880 top employees???

    What a coincidence too, the the Canadian government loaned them
    $30 million dollars taxpayers money to stay afloat! he he he!

    I thought they were 'bankrupt ' due to economic athmosphere of the
    country and yet have the GULL to ask the courts for exec. BONUSES?

    Now! I can explain to my children that ” RE-STRUCTURING” means
    the re-structuring of 'salaries & bonuses' to top executives of the company!

    Just “Where is the Business Plan?” and
    “Where is the “Creditors Arrangement Plan?” tsk? tsk? tsk?

    Why can't NURSES get this obscene bonuses? They CARED for people!!!

  • NTdown

    Today, lots of “I believe” posters were just pasted everywhere in Beijing office.
    Hilarious!

  • PM_Guy

    Maybe the rest of Nortel employees should talk a cue for their leaders. Pillage the company as much as they can before it collapses with greed. At least they will have something in their pocket when they are severed by the company. Fortunately for NT executives most employees have morals and won't do that.

  • angermanagement

    I never thought I would be ashamed of the company I work for.

    I truly am.

  • sick_sigma

    Every time that there is a conference call with the executives they go on and on about how “committed” they are. Well if that is true then why the need for this new bonus plan? It makes it even worse when these same execs constantly reminding us how committed all the rest of us need to be.

    A bonus is supposed to be something extra. The opposite is going on right now. Mike zeroman and his crew have Nortel plummeting into the abyss and they still believe that they are entitled to even more money above and beyond their already bloated salaries? Incredible!

  • Moose_Chaser

    Yup – I agree with you.

    There was a time when I was SO PROUD to tell people who I worked for.

    That was a long time ago. MC

  • felixmk

    I am a creditor to Nortel. These execs work for me and the other creditors. I hope they explain how these bonuses will get more of my money back.

  • 1Skeptic

    I would love to see the judge stand up . . . . look at Z and tell him:

    “I Believe – you should take a look at the example set by your employees that for years gave up pay raises and bonuses”

    and

    “I Believe – rewarding executives for their failure will further demoralize and devalue the company”

    and

    “I Believe – that the money requested for ELT bonuses would be best spent treating the recently severed employees with the dignity they deserve”

    and

    “I Believe – this request is denied”

  • dianeurquhart

    Diane Urquhart is interviewed on Canada AM, Friday, March 20th, 7:05 a.m. about Nortel seeking bankruptcy court approval to pay executive bonuses for 8 top executives, while over 1000 Canadian terminated employees are not getting severance pay and are therefore forced to draw public employment insurance benefits. Severance cost savings, otherwise an obligation of Nortel under Canadian employment statutes and common law precedents, will now be paid out of the public employment insurance system. This backdoor public system bailout provides cash for the payment of the Nortel senior executive bonuses.

    The Nortel court appearance to seek approval for the executive bonuses for 8 top executives is occurring at the Commercial Court in the Old Canada Life Building, 330 University Avenue this morning March 20th at 10 a.m.

    http://www.ctv.ca/canadaam

    Interview also available on YouTube.

    http://www.youtube.com/watch?v=FOqFcYfEXjk

    Juroviesky and Ricci LLP, on behalf of its Nortel Canadian terminated employees' clients, will be opposing the Nortel motion to approve the Key Executive Incentive Plan for the 8 top executives in court this morning. The reasons for this position will be posted at Juroviesky and Ricci LLP's website later today.

    http://www.jruslaw.com/classactions/nortelccaa/

  • Casual_Observer

    Time to take them out. Where is Jack Bauer when you really need him.

  • peludo

    Here an interesting interview .
    The recent speculations related by WSJ seem to be shared by other analysts :
    http://watch.bnn.ca/#clip149245 ,
    and moreover, the life-time estimation of Z in the new Nortel (or something else) is relatively limited in time.
    Nice news isn't it ?

  • whatnext4nt

    These bonuses are not in the best interest of creditors. They are greedy and stupid. They are unnecessary at best as many people here have explained. In fact the bonuses will do more harm to the company than good; since they will outrage the rank and file employees to a point where the damage in morale and consequent impact to productivity, quality, sales, customer support, product and operational cost reduction will be enormous.

  • minnetonka1

    If the G&M is correct that NT management is queuing up its businesses for a general sell off, then the incentive packages for upper level employees are de facto severance packages. That may a little hard to swallow for employees who've been asked to give up theirs.

  • felixmk

    Really!? I had not thought that paying millions to well paid execs might compromise me getting back the money that Nortel owes me. I guess that my representatives, the board and the courts, will veto these bonuses!

  • 3rd_world

    I want a piece of this cake :P

  • less

    Mike Z's interpretation of his elite A ('A' meaning 'Z' in Z-Speak, natch) -Team's curiously dim, rote, lifeless and tired Nortel chant: “Business Made Simple” has equated to firing simpletons without severance, leaving creditors in the lurch and flipping the Hole Acne bird at customers: “I'll do whatever I please.”

    “Business Made Simple” had Mike Z crank his own JCI level up to 11 – to the point where the screwed up Nortel beyond all repair, so he “simply” filed, fittingly enough, Ch 11.

    I take Z's definition of “going green” to mean casually grabbing the last of Nortel's remaining cash as he boasts of Nortel as a de facto – i.e. maybe possibly perhaps future – recognized leader, an elite club of JCI 11s, only.

    It just needs a bit more time, a tad more money…

    If the masses let him get away with it they'll wind up looking just as he sees them – as simpletons not worth the paper their severance agreements were printed on.

    Nortel doesn't owe me anything, so I'm just spectator here, but the more I see Mike Z's twitchy petulance spitting out, yep, dim, rote, lifeless and tired buzzwords on video, the less I like the guy.

  • TongueInCheek

    It is my understanding that it is very rare for a CEO of a company entering Chapter 11 to remain as CEO when they have exited Chapter 11. I would expect a major overhaul of the ELT as they exit (would take a few months) and depending on which business segments are sold and retained.

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