Sears and Kmart, the world's longest going out of business sale.
How's that legal?
It's bankruptcy protection. I haven't heard about the payments to executives and I'd like to see some supporting evidence prior to issuing a comment, but once a company declares bankruptcy all payments for outstanding debts is an issue for the bankruptcy trustees to solve and sears is no longer directly responsible for solving the issue.
Ok guys, you've completely run this business into the ground....here's some money so you won't leave us!
That could have been $3304 to each of the 2300 employees in case you were wondering.
This is the article that sent me in search of Scumbag Steve :-).
Ah it is retention bonuses to keep them from jumping off of the sinking ship.
Kmart's pretty much all shut down in my town. Sears isn't far behind them. All we have left here is one dept store that's been here 40-50 years, and an automotive center that's close to being a husk.
Call me crazy, but Wages / Salary is most certainly a company debt, and the one that should be paid first. Even then, the severences and bonuses are up to company discretion. Disagreement on how they are allocated or gifted happens, such as in this case in which it's complete and total BS.
It's legal because corporations basically pay to have favourable laws. It doesn't matter what country you're in.
This kind of shit disgusts me beyond belief. I hope every executive that receives a bonus from this loses everything they care about in their lives.
Someone has to remain in a leadership role to oversee the dismantling of the company. It doesn't all disappear immediately which is why they want to try and retain upper mamagement.
WRONG!!! Everyone receives $330,400
But why? They've declared bankruptcy. Why not have management taken over by the bankruptcy trustees? No execs are that important that they have to stay around.
This guy maths!
Sure, but payment of employees is not a debt. And any bonuses should be paid after payment of salaries IMO.
What The Sears?
Seriously though, this rebranding must be expensive. It's such a slow and painful death to watch.
Nothing will replace them.
But the best thing is, the executives will get whatever they want but the employees may lose everything they care about in their lives.
Oh wait thats not the best thing at all.
But... what would actually happen if everyone was all "Fuck this mess?" I know you said it won't accomplish itself, but what happens if just everyone decides not to?
CEO Eddie Lampert is doing this on purpose.
Eddie Lampert is the biggest piece of shit so really nobody should be surprised. This is exactly what he does every time.
No... 330,400 is like a third of a million... The execs got 7 or so million total. That would only be 21 or so employees.
So (insert youre wrong pic here.jpg)
Oh wait fuck me i got whooshed
You don't want the pilot to jump out of the plane with a parachute if you're going to crash. You hope they will stay in control as long as possible to minimize the losses.
Bankruptcy Code, section 507 Order of payment for liquidation: Secured creditors Unsecured creditors-includes wages Stockholders
That goes for outstanding wages. I'm unsure how severance or pensions work in this scenario.
Edit: that's for US. Can't speak for Canada.
Ultimately someone (either a person or a group) actually owns the company and it would fall to them to run it. CEO's and whatnot are high level employees but they're still employees not the owners.
No you are legally entitled to severance in Canada, at least in my province, depending on the length of your employment and if you were full time.
They don't have some option to not pay under normal circumstances, not sure how bankruptcy affects it.
Chernobyl. Everyone drops everything and walks away. Assets stay where they are unless someone wants to pay to have them moved. But the question is valid; Why pay $7m to liquidate assets and oversee the shuttering of the company vs "here's all your cheques and everyone can take as much as you can carry in one arm. GO!"
I don't hate Sears. It's just obvious it's going out of business and it has been for a while. As you said. "There is never a line" that's not a good thing for a store.
It's like you ride out out until it sinks and you die but different.
You are so wrong. The executive class always takes care of their own. They may take a bit of a pay cut but they will all get executive positions in other companies.
"Hey! All you executives that ran our company into the ground! Here's a bunch of money to say that we appreciate your efforts and want you to stick with us!!!"
Yeah, I'm sorry but I don't get their logic at all.
As opposed to accidentally paying out millions in bonuses?
Assets still need to be liquidated, that won't accomplish itself.
Think about it like this. They have a company with a fair amount of real property, buildings, trucks, inventory, who knows what else, stuff that's worth some real money. Someone ultimately owns all of this, investors, bondholders, etc. Sears can fire their top people, lock the doors walk away and let the local cities take care of things, but they will still end up with bills for this and lose a helluva lot of money in addition to losing their company. Or, they could keep on the people who know how the company works, know the systems, know the details, know who to talk to to get things done at Sears. They could take these people who are intimately familiar with the company and pay them to effectively wind things down, sell things off, keep track of the appropriate legal stuff. Pay them something to stay in a literal dead end job while they make it so investors only lose a lot of money instead of a helluva lot of money.
Do you need a top CEO to liquidate assets of a failed company? Surely they can hire someone to do this kind of thing for far less money. It just seems like the board decided to give the board one final golden parachute under the guise of "we need to retain them/us in order to oversee the final operations."
Um it's called this new thing, "Run away Capitalism." Golden parachute only for those who can literally afford a golden parachute.
...rich, and not dead.
They aren't rebranding anything at this point. They're internally liquidating inventory and closing stores gradually as they ramp up for bankruptcy. 42 more Kmart and Sears store closings were announced last month in the US and as the title here suggests, Sears Canada is done.
They're prepping that golden parachute pretty hard.
Edit: I stand corrected. Apparently Sears Canada has recently remodeled some stores and rolled out a new ad campaign.