The United States, it seems, is sorting its priorities in a rather public manner. The citizens of this country are outraged at the chasm that has been revealed between workers and executives in terms of salaries and other compensation. While workers show up for work every day and perform the work that keeps the wheels of the operation turning, they are often paid barely a living wage. When executives show up for work to steer the operation, they are rewarded lavishly. Even if all the wheels fall off the business and it crashes, they are granted huge bonuses and for what reason? Because the company wants to keep these talented people on board? If they are so talented, why did the business crash?
For fifteen years I worked on the front lines of a Fortune 500 company. Okay, so they weren't a Fortune 500 company when I started there, but that's where they ended up, near the top, if never at the top. I was in retail management, an industry that definitely illustrates this chasm in pay between the people who make the company money on a daily basis and the people in cushy offices who are soaking up the profits with their high six and even seven-figure salaries and bonuses. Sure they were calling the shots up there, but their shots usually meant more work for the workers and managers with little or no tangible results and certainly no rewards for our extra efforts. Oftentimes what they had us do was counterproductive and counter-intuitive, wasting money on signing and staff, while granting us no extra allotment of payroll hours. Essentially, we as managers were forced either to do the extra work on our own time or have our staff do it while also attempting to offer excellent customer service. A scattered focus leads to scattered results every time. This was clearly displayed in sales data during the weeks when we had to take on these new corporate-initiated directives.
Originally the company I worked for had been owned by another corporation, a good organization, but one that began to struggle in the changing retail market and growth of big box stores. Our division of the company, however, was solid and, while it needed a little trimming, was largely successful and profitable. So much so that the company that owned us sold us to keep themselves afloat with the money they gained from our sale. Only they sold us to an upstart of a company that had barely cut its teeth in the industry, an industry we had survived and thrived in since the late 1930s. Yes, our part of the company had survived the Great Depression then expanded as America grew stronger, until by the early 1970s, we had stores in all fifty states. We were the first chain of our kind to achieve this and remained the only one with such a presence for more than a decade. The company who took over ours wasn't even in existence at that time.
When our new owners took over our division of the company, they squeezed the life blood and revenue out of it, cast thousands of talented employees aside, and have thus far reduced the number of stores by about eighty percent. They downsized perfectly viable and profitable stores because they wanted to expand their side of the corporation in the then growing economy. They are now in dire straits and deeply in debt to foreign investors. It's no wonder either, given that they closed the very stores that had provided the cash flow, which had enabled them to open more of their stores. The new "bigger and better" stores sometimes thrived and sometimes failed and have since closed their doors.
While I was a store manager, I led my team to victory after victory. Yes, we won awards (non-monetary, of course) and got bonuses (puny in comparison to the money we were raking in and what the executives were getting in stock options, salaries, business expenses, and bonuses). Only management (usually two people per store) got a bonus at all. From the start, I shared my bonuses in a small but tangible (read, monetary) way that my employees instantly recognized and enjoyed as most unusual for this outfit in its current incarnation. Small as they were, the rewards motivated my staff by helping them to feel like their input was making a difference. This sense of belonging and purpose then spurred our store on to greater successes, despite the fact that the company began making it harder and harder for employees to merit a yearly raise.
Most of the time, the workers got no pay increase unless they were a superstar in all areas, and, to be truthful, no matter how awesome an employee was, we were not allowed to give them superior ratings in all categories. We were not even allowed to give them a preponderance of above average ratings. We were required, in fact, to give them a "needs improvement" in at least one category, even if they had been with the company for twenty or thirty years and excelled at their jobs. We had employees in that category because originally, it had been a good company to work for. Sadly that is no longer true and their ledgers and payroll rosters reflect this reality. Although the huge bonuses and perks continued to flow at the top, they throttled the company by siphoning off the overflow to the workers. Executives got everything. Employees were lucky if they got a raise that was the equivalent of a cost of living increase. This new trend started about five years ago.
To make this more concrete, I offer the following example. After sweeping all the sales awards for our district and being one of the few stores in the company that made their yearly plan that year (never mind that we had exceeded our goal by between 5-10%), I received a piddling two percent increase that year as manager of that store. It became clear in that moment that my future in the company was counterproductive to making a real living. Never mind saving enough to make a down payment on a house. That was my thanks for having shaped a winning team of employees and growing my store sales $200k in two years. I had grown that store from an $800k store to a million-dollar-plus store in two years. I posted an extra $200k in sales and got a two-percent raise for my efforts (equal to less than $600/year). Plus I was told by my district manager that I should be happy with that, since most of my fellow store managers had gotten no increase that year because they had not met their yearly sales plan. I nearly choked on my shoelaces, I was so floored by this spin on the situation.
Meanwhile the executives were tossing around millions of dollars in bonuses for their efforts. Most of their efforts involved changing gears every year or two when they changed top executives. Each one in turn decided that the company needed to head in a different direction. Is it any wonder the whole corporation began to resemble a drunken sailor after a night on the town following a six-month tour of duty on the high seas? Stocks began to dip then plummet, and this was before the economy went down the tubes. This company, in fact, was part of the same sickness, a.k.a., corporate greed, that has led the United States to the brink of economic ruin. Only they started falling apart before the most recent debacles, so they will probably not be subjected to the same humiliation as AIG and now American Airlines. Their huge corporate bonuses are long since spent and cannot be called back, any more than the thousands of jobs that have been lost because of store closings.
While I have made peace with my departure from the company, and am glad for it actually, I am still happy to see a public reckoning for a vice that has been an integral part of our society for too long. None of this is written in malice towards the people in this company. Nobody wants to see good companies go down the toilet. I think, however, that what we are seeing now is that the truly good companies are the ones who reward their employees on a more sensible and realistic level. Lots of smaller bonuses and rewards for more people doing a great job. I have no objection to a top executive, doing an awesome job, receiving a nice bonus and a handsome raise. But that top person wouldn't be succeeding without thousands of workers who show up for work each day to do their jobs, which ultimately leads to that executive looking good. All I'm saying is that the workers should be getting a share in the spoils of success. The success of a business should lead to all of its employees, or at least the ones who are pulling their weight, being rewarded for their efforts. Remember the old phrase the "trickle-down effect?" Whatever happened to that concept? Oh yeah, the companies that are surviving the current economic situation are still operating their businesses using that model. It's about time the United States re-awakened to this simple concept of fairness in employee compensation. It is good for our economy. Corporate greed is not, obviously, and it's about time we figured this out and made big business accountable.
Beth Mitchum is the author of five novels, one collection of poetry, and one music CD. Her works are available at Amazon.com through the following link:
Beth Mitchum's Books and Music