I worked in retail for about twelve years. I started out at the local lumberyard after I got out of the Army, loading trucks in the yard. I worked my way up to counter sales, and eventually manager of retail operations for my location. It was a thankless, soul-sucking job, where customers treated you indifferently on most days, like a doorstop on others, and as their personal punching bag when they were having a bad day. When Home Depot moved in and I was laid off, it turned out to be a blessing.
The takeaways I have after working in retail are many. But the one that stands out is that, if you fail in your job and you are a rank-and-file employee, you will find yourself out of a job. I went through two store managers at the location where I finished my retail career before Home Depot moved in. Both were let go for lagging sales brought on by a corporate office that raised prices and did not take into account variations in regional markets.
If you are in outside sales and your largest contractor has a heart attack and dies, you are shit out of luck if you cannot find new business to replace that contractor. If the housing market goes belly-up, you could find yourself out of a job, even if you have worked there for 20 or 30 years, without so much as two nickels to rub together.
But if you are an executive of a large corporation, well, you can drive that company into the ground and come out with a bonus.
Sears, currently going through bankruptcy, is one of those large corporations. Gross mismanagement has driven what was once the largest American retailer, the anchor of malls across America, out of business. Gone are stalwart brands like Craftsman, sold off to Stanley Black & Decker; Lands’ End, being split off into a stand-alone company; and Kenmore, being either sold off or scrapped in a last-ditch effort to raise capital.
One would think heads would roll at the executive level for this level of incompetence. In a just world, that would be the case. But in America, it seems as if there is no justice.
Sears filed two different types of bonus plans in bankruptcy court
Thursday. The first is for the top 18 "key" executives, who would collectively get as much as $2.1 million per quarter up to a maximum of $8.5 million. The bonuses would only be paid in full if Sears reaches its cash-flow targets. Sears Holdings, which includes both Sears and Kmart, has been burning through cash at a rate of about $125 million a month.
A second retention bonus plan was designed to encourage 322 other unnamed executives to stay put during Sears' reorganization. They would collectively get $16.9 million over the course of a year, which works out to an average of about $52,000 annually per executive. No executive could receive more the $150,000 in bonuses for staying with the company during the bankruptcy process.
The men and women who have worked at Sears for years are at the end of the line, begging for crumbs, and they are unlikely to get even that.
The company wants to retain as many executives as it can, but Sears is laying off employees who staffed hundreds of stores it is closing. Many hourly workers claim they will not be paid severance.
Shelia Brewer, who worked for 17 years as a full-time hourly employee at a Kmart in Rockford Illinois, said the company told her she'd get eight weeks of severance. Instead, she received a letter saying that severance payments were being halted because of the bankruptcy, and she would get only the four weeks of pay she had already received.
"It hit me hard. I was already struggling as it was," she said. She said the bonus plan makes her angry.
"They say we can't get our severance because there's no money, but they're getting bonuses? It's like a slap in the face," she said.
Sears employees who were able to retire will at least have their pensions covered by the federal government.
If Sears, once the nation’s largest retailer, declares bankruptcy, it could cause one of the biggest pension defaults in U.S. history, but the government would step in to keep checks coming to more than 90,000 retirees.
The company’s long-term pension obligations, which have been underfunded by more than $1 billion for years, would be covered by the federal Pension Benefit Guaranty Corp.
Corporate welfare at its fines: Incompetent executives get millions in bonuses, and the taxpayers have to pick up the tab. Of course, this does not even take into account the Sears employees who put in multiple years at the retailer and won’t get a dime when the inevitable happens and their store is closed. Sears will survive—and those who spent their lives keeping the lights on will, too—but the latter will endure unnecessary suffering.
I am reminded of an old country song:
Specifically the chorus:
Won't you tell me if you can
Cause life's so hard to understand
Why's the rich man busy dancing
While the poor man pays the band
Oh they're billing me for killing me
Lord have mercy on the working man