With a looming recession, it’s a tough time for banks. But why should their executives have to suffer, right?
One mark of a good employee bonus plan is to adjust it as conditions inside and outside the workplace warrant while still holding workers responsible for their decisions.
Well, this case set off the warning buzzer on our BlunderMeter, the nifty device we use to identify potential HR Blunders for you.
Washington Mutual has revised its executive compensation plan so fallout from the subprime meltdown won’t affect their bonus checks.
The bank has excluded the cost of bad loans and expenses arising from foreclosures when calculating net operating profit, according to the Seattle Times. A regulatory filing uncovered the change.
WaMu spokeswoman Libby Hutchinson said, “The bonus plan covers almost 3,000 WaMu executives, many of whom are not directly involved in lending.”
That statement raises two questions instantly (and probably more later): What about the executives who are involved in lending? When those subprime dollars were rolling in, did any of these same execs object that their bonuses were too high because the profits didn’t come from their departments? Nah, we didn’t think so, either.
