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Big Business Pledged Gentler Capitalism. Itís Not Happening in a Pandemic.

Big Business Pledged Gentler Capitalism. Itís Not Happening in a Pandemic.

Old Apr 14, 20, 8:03 am
  #16  
 
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Originally Posted by CPRich View Post
How is a raise next year guaranteed when it was given then rescinded this year? Do you have access to some guarantee mechanism we aren't seeing - please share.

A 7.7% raise in 2021 after, reportedly, no increase since 2017 is a 1.87% GACR. Inflation in the US has risen 8.03% over the last 4 years.

You find a raise below the rate of inflation to be reprehensible?
With the current state of the economy, I stand by my original statement. Executive compensation raises in any form should be off the table this year whether it be for the current calendar year or future years. If a company wants to commit to raises for all staff, commit to not do any reduction in force, and to give raises across the board to all rank and file staff, then it would be okay. Furthermore in that scenario, the executive compensation raises (all forms of their comp) should be aligned to be a the same or lower percentage as offered to the rank and file staff on average.

It is most likely going to be a lean couple of years for many if not most folks. Executives should do their part and sacrifice. In good times, executive tend to get a disportionately higher benefit in compensation. So in lean times it is appropriate they also take a disportionately higher reduction in their compensation.

We can agree to disagree if you like.

--Jon
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Old Apr 14, 20, 11:48 am
  #17  
 
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Originally Posted by Jon Maiman View Post
It is most likely going to be a lean couple of years for many if not most folks. Executives should do their part and sacrifice. In good times, executive tend to get a disportionately higher benefit in compensation. So in lean times it is appropriate they also take a disportionately higher reduction in their compensation.
To be fair, very few of us would tell our employer we didn't want more money. The issue of a raise is on the board, not the CEO. What the CEO decides to do with the raise is on him.
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Old Apr 14, 20, 1:48 pm
  #18  
 
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Originally Posted by EuropeanPete View Post
Given the context, I don't think Marriott's employees, franchises or hotel guests are going to look favourably on this. .
I'm not sure that's correct for these reasons:
  • Marriott employees - most Marriotts branded properties are franchises and the employees are employees of the franchise, not Marriott itself
  • Franchisees - I don't think the CEO's compensation affects them
  • Guests - I suspect outside of FT venues, most guests aren't that engaged.
Of course, optics are everything.
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Old Apr 14, 20, 3:17 pm
  #19  
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Originally Posted by clarkef View Post
I'm not sure that's correct for these reasons:
  • Marriott employees - most Marriotts branded properties are franchises and the employees are employees of the franchise, not Marriott itself
  • Franchisees - I don't think the CEO's compensation affects them
  • Guests - I suspect outside of FT venues, most guests aren't that engaged.
Of course, optics are everything.
By Marriott employees I really did mean Marriott employees - many of whom have recently been furloughed. On franchisees, many were already complaining that Marriott had been screwing them over. While of course it's not really their business, that's not how actual live human beings work. And yes, "most" Marriott guests have no idea who Arne is, but many bankers, consultants, analysts and journalists are regular Marriott guests and so are (like I am) going to take a view as to what this says about the company.
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Old Apr 14, 20, 5:01 pm
  #20  
 
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Originally Posted by EuropeanPete View Post
By Marriott employees I really did mean Marriott employees - many of whom have recently been furloughed.
IMO, this is the biggest impacted group. I'm 100% certain that those employees who remain, and some of those who are gone, will be discussing the raise and bonus, and of course it won't be positive. Now, that $100k raise wouldn't bring a lot of people back to work, but as I wrote earlier, not taking the raise is symbolic -- "we're in this together".
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Old Apr 14, 20, 5:20 pm
  #21  
 
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Will Marriott even hire back workers at their present wages when the furlough is over? I am not so certain. Who is going to make that decision? Arne Sorensen who will have no credibility with the front line.

But hey, he’ll do fine in retirement.
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Old Apr 15, 20, 1:03 am
  #22  
 
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Originally Posted by EuropeanPete View Post
By Marriott employees I really did mean Marriott employees - many of whom have recently been furloughed. .
I absolutely agree that actual Marriott employees will no doubt be pissed
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Old Apr 15, 20, 7:22 am
  #23  
 
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Originally Posted by cfabar1 View Post
Will Marriott even hire back workers at their present wages when the furlough is over? I am not so certain. Who is going to make that decision? Arne Sorensen who will have no credibility with the front line.
Of course, no one can be certain, but why wouldn't they? In just about any company, training is a significant portion of the cost allocated to a new employee. Much cheaper to hire people back than to train new people. And if you don't offer the same wage, there will be a portion that won't return. Not to mention the terrible P.R. this would be for Marriott.

Very little in the corporate world shocks me at this point, but I'd be very surprised if they didn't take people back at the old wage.

The other side of this argument though is whether you can determine when the furlough is over. Marriott's business may not return to normal for several years. I'd expect that most of those who were furloughed would have moved on to other jobs by then. So you may very well see their wage expense decrease -- both in total and on average if they hire new people.
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Old Apr 17, 20, 4:53 am
  #24  
 
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Originally Posted by Intl359Widget View Post
It's disgusting to see how the CEO is getting a 7.7% pay raise and bonuses during this pandemic...

It's time for Arne and the Marriott Board of Directors to go if they're not going to focus on the Marriott way of doing good by their employees and the communities that they serve..
If the actions of a For Profit company offends you why not just Stop funding them and walk away?
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Last edited by Dublin_rfk; Apr 17, 20 at 4:54 am Reason: Soften the post and correct
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Old Apr 17, 20, 7:27 am
  #25  
 
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Originally Posted by Dublin_rfk View Post
If the actions of a For Profit company offends you why not just Stop funding them and walk away?
I do think it's a real issue, beyond what individual customers think. I'm the most pro-capitalism, pro-free market person I know. I wonder how shareholders (I'm not one) view the CEO getting a raise+bonus while the stock has dropped nearly 50% and the company's future is uncertain. And again, the effect this has on the morale of employees. When a "For Profit company" is not making a profit, should executives be rewarded?

As others have said, if the company never recovers, maybe he doesn't collect on the compensation promises. I have no doubt Marriott will remain in business, but they may be slightly smaller. Right now, a raise announcement seems like poor timing for a number of reasons.

To me, many of the adjectives people use here (disgusting, reprehensible, etc.) don't apply. I think it's just bad business.
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Old Apr 17, 20, 8:35 am
  #26  
 
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Originally Posted by JBord View Post
I do think it's a real issue, beyond what individual customers think. I'm the most pro-capitalism, pro-free market person I know. I wonder how shareholders (I'm not one) view the CEO getting a raise+bonus while the stock has dropped nearly 50% and the company's future is uncertain. And again, the effect this has on the morale of employees. When a "For Profit company" is not making a profit, should executives be rewarded?

As others have said, if the company never recovers, maybe he doesn't collect on the compensation promises. I have no doubt Marriott will remain in business, but they may be slightly smaller. Right now, a raise announcement seems like poor timing for a number of reasons.

To me, many of the adjectives people use here (disgusting, reprehensible, etc.) don't apply. I think it's just bad business.
My apologies my post wasn't directed at you specifically. I am a MAR shareholder and UAL too as well several more stocks and two different retirement programs. My method of evaluation is based on longer term information. I make my investments (time, money, associations) where possible for the long haul. I've been a MR member since the mid 90's and I haven't been thrilled with many of the recent changes but I'm still here, the same with UAL. My instinct tells me that this is a (good sized) bump in the road and that in less time than most people think this will be behind us. As for business practices I believe that Marriott will make the best decisions possible in the constantly changing landscape. With intervention by the government at every level (Local, County, State, Federal) changing daily and affecting all levels of operations. At this minute an elected local government official is blathering on about how fluid the situation is and that he will extend his travel restrictions for another 30 days! How can an International company plan and work efficiently when one little politician can cause a large disruption?
As for the nyt hit piece, bad timing? Using an agreement made last August to bash companies for actions made today doesn't sound like reporting and calling it analysis does't make it either.
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Old Apr 17, 20, 10:08 am
  #27  
 
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Originally Posted by Dublin_rfk View Post
My apologies my post wasn't directed at you specifically. I am a MAR shareholder and UAL too as well several more stocks and two different retirement programs. My method of evaluation is based on longer term information. I make my investments (time, money, associations) where possible for the long haul.
I didn't take it that as directed at me either . Just pointing out that it's more than just a "if you don't like it, don't be a customer" situation. I agree with about 95% of what you wrote but, if I were a shareholder, I would have some concern about the long term impact. The raise and bonus are really just small things in the long haul, but employees have long memories. We don't know what impact that will have on the business or for how long. Marriott had the opportunity to have their employees believe that they were all in it together, would weather the crisis, and people would come back to work. Instead the board gives the CEO a raise while employees are laid off.

Maybe employees will shrug this off and be grateful they have jobs again when this returns to normal. Or maybe they'll harbor a grudge. As a UA shareholder and (I assume) customer, you probably remember how that played out for UA's business not so long ago. The stock was barely moving while it's competitors' was consistently rising.
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Old Apr 17, 20, 2:13 pm
  #28  
 
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Originally Posted by JBord View Post
Right now, a raise announcement seems like poor timing for a number of reasons.
It isn't like Marriott wrote a press release - someone wrote a news article - which in my opinion wasn't very realistic as we don't know really know what will happen with executive compensation in the future.

I think Marriott employees are more worried about their individual futures than CEO compensation
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Old Apr 17, 20, 2:44 pm
  #29  
 
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Originally Posted by HNLbasedFlyer View Post
It isn't like Marriott wrote a press release - someone wrote a news article - which in my opinion wasn't very realistic as we don't know really know what will happen with executive compensation in the future.

I think Marriott employees are more worried about their individual futures than CEO compensation
But that's exactly how these things get out to employees, so I'm not sure why that matters. I understand your point about executive compensation being fluid...although I think it's unlikely the board would rescind the raise. In any case, why not hold off on it though?

I have some personal experience here. A company I used to work for went through a period where, while making a profit, margins weren't making analysts happy. The CEO announced massive cost-cutting, layoffs, etc. And then, while we were in the middle of this, the CEO got a big raise. There were a whole lot of people who just began working to order, meaning they did the minimum required to keep their jobs.

And I agree with you that employees have bigger concerns. Hopefully employment is a short term concern as things return to normal. But then they'll remember this.
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Old Apr 17, 20, 5:40 pm
  #30  
 
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I have some personal experience here. A company I used to work for went through a period where, while making a profit, margins weren't making analysts happy. The CEO announced massive cost-cutting, layoffs, etc. And then, while we were in the middle of this, the CEO got a big raise. There were a whole lot of people who just began working to order, meaning they did the minimum required to keep their jobs.
Most of us have been thee. At least once.
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