A Bonus by Any Other Name Would Smell As Stinky ( Dana )
The Bankruptcy Abuse Prevention and Consumer Protection Act (BAPCPA) prohibits retention bonuses intended to keep executives on the payroll throughout a bankruptcy procedure "unless the company can show that the executives in question have a bona fide job offer that would pay at least as much as they were already receiving."
Since it's unlikely that executives who run their companies into bankruptcy will have potential employers knocking on their door to compete for their services, they choose to find a loophole in the law. So, instead of calling it a "retention bonus" they call it an "incentive payment." Creditors, who will not be repaid, and unions, with members whose salaries and benefits will be cut, don't buy it. Fortunately, the government agrees with them. So, case closed? No.
Dana…argued "that creditors and unions who opposed the plan were trying 'to short circuit the business judgment of Dana' and 'replace that fully informed and careful judgment with their own parochial interests.'"
Yes, they actually called their judgment "fully informed and careful." Where was their fully informed and careful judgment when the company was falling into bankruptcy? Are we supposed to believe they have it now?
And accusing creditors and unions of having a "parochial interest" in opposing the pay plan is quite interesting. In psychology, it's called "projection" when you attribute your own motives to another person or group.
Since it's unlikely that executives who run their companies into bankruptcy will have potential employers knocking on their door to compete for their services, they choose to find a loophole in the law. So, instead of calling it a "retention bonus" they call it an "incentive payment." Creditors, who will not be repaid, and unions, with members whose salaries and benefits will be cut, don't buy it. Fortunately, the government agrees with them. So, case closed? No.
Dana…argued "that creditors and unions who opposed the plan were trying 'to short circuit the business judgment of Dana' and 'replace that fully informed and careful judgment with their own parochial interests.'"
Yes, they actually called their judgment "fully informed and careful." Where was their fully informed and careful judgment when the company was falling into bankruptcy? Are we supposed to believe they have it now?
And accusing creditors and unions of having a "parochial interest" in opposing the pay plan is quite interesting. In psychology, it's called "projection" when you attribute your own motives to another person or group.
