Monday, October 19, 2009

Dividends, Corporations, and Greed


Hypothetically speaking, let's say there is a large global corporation that has recently laid off employees, stopped all raises and bonuses, and stopped matching employee's 401(k) contributions. The general feel around the office is that these are hard times and everyone should be cutting back. Employees should be glad that they have a job. On the surface this looks to be the same story that a lot of other companies are facing at the current time. But is it? Lets also say that this company's stock has been steadily on the rise while executives proudly boast that the company has huge amounts of cash on hand, more money than the company has ever had before. To top things off let's also say that this company decided not only to give its shareholders a dividend but also raise the dividend from the previous payment. All the while this company does not change any of its coast cutting tactics on its employees mentioned above.

To top things off, the company continually publishes messages on its intranet page that is readily available to all employees about how well the company is doing, that it is raising its dividend and it is sitting on mountains of cash. There is no mention about when the employees will get their much deserved compensation in the form of raises, bonuses, and 401(k) matches. As a matter of fact it comes as a slap in the face to these employees to read all of this “great” information about the company they work for while they are all getting the short end of the stick.

Even though this is a hypothetical story, what would you think if you were an employee in this situation?

1 comment:

Girl With Camera said...

I know what it feels like to work for a company that seems to be doing better but is cutting costs on the employee side. And, there is one word for what it feels like...shit.