Archive for March, 2009

Survey Finds Banks Aware of Pay Flaws

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Published in the Wall Street Journal, March 30, 2009 by Stephen Fidler

Banks almost unanimously agree that their compensation packages contributed to the global financial crisis but are still struggling to correct some of the flaws in their pay structures, according to ta survey of financial institutions due for publication on Monday.

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Stock Options Are Adjusted After Many Share Prices Fall

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Published in the New York Times, March 27, 2009 by Jonathan D. Glater.

Employee pay is often tied to a company’s fortune — until things turn sour.

Composite Technology, which makes electric cables and other products, decided in January to lower the price at which its workers could use their stock options to buy shares in the company.

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The Legal Profession Feels the Pain of the Recession

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Published in the New York Times March 26, 2009, by Michael J. de la Merced

The wave of layoffs has crashed upon the legal industry.

With the drastic slowdown in the financial sector, increasing numbers of law firms have announced layoffs, lopping hundreds of associates and other nonpartner positions this year.

Just like investment banks, corporate law firms expanded their employee rolls during the boom, adding lawyers to practices that are now struggling. And these firms are now having to shrink their rosters in the face of diminishing profits.

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Did the Health Insurance Industry Blink?

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expert perspective telescopeExpert Perspective by Grahall’s Robert Cirkiel

In an article entitled “Insurers Ease Stance on Pre-Existing Conditions” published in the New York Times published on March 25, 2009,  journalist Robert Pear discusses an announcement by the insurance industry indicating that “it was willing to end the practice of charging higher premiums to sick people if Congress adopted a comprehensive plan that provides coverage to all Americans.” 

Health insurers surprised lawmakers with this concession, but did they “blink”? 
Continue reading “Did the Health Insurance Industry Blink?” »

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Paid Handsomely to Stay

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Published in the New York Times March 25, 2009 by Eric Dash and Jonathan D. Glater

Before the furor over pay at A.I.G., most Americans probably had never heard of a retention bonus. But like C.D.O. and credit-default swap, the term, a bit of sugar-coated corporate-speak, is quickly entering the popular lexicon.  Retention bonuses, it turns out, are not uncommon in corporate America — or indeed among companies that have been bailed out by taxpayer dollars.

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As Banks Flounder, the Perks Play On

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Published in New York Times on March 26, 2009 by Michelle Leder

For much of the 1990s and the early part of this decade, a small group of men built financial behemoths by snapping up ever larger competitors and adding branches with almost reckless abandon in an attempt to build truly national banks that stretched from Florida to Alaska.

Two North Carolina bankers were among the biggest players in the buildup: Hugh L. McColl Jr., who turned a modest North Carolina bank into what eventually became Bank of America, and Edward E. Crutchfield, who built First Union, which ultimately became Wachovia. Based in Charlotte, the two men and their rivalry helped drive the banking bonanza and made both of them very wealthy.

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Insurers Ease Stance on Pre-Existing Conditions

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Published in the New York Times, March 24, 2009 by Robert Pear

The health insurance industry said Tuesday that it was willing to end the practice of charging higher premiums to sick people if Congress adopted a comprehensive plan that provided coverage to all Americans.

The industry’s flexible position on the issue came as a surprise to lawmakers, and could make it easier to reach an agreement in Congress because it narrows the issues on which insurers are ready to fight the Democrats who control Congress and the White House.

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Filling the Short Term HR Gap (aka – It’s about Leadership, Stupid!)

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expert perspective telescopeExpert Perspective by Grahall’s Connie Vogt

In the article “Employees Spending More Time Worrying About Job Security” published by SHRM on March 13, 2009 ,  Theresa Minton-Eversole of SHRM addresses the fact that “With the constant barrage of media attention focused on the economy and the escalating unemployment rates, its no wonder employees – at all levels – are concerned about their careers and their future employment prospects.”

Grahall Commentary:

At a time when employees desperately need guidance and reassurance from their leadership team, it seems they’ve all gone missing (or at least hidden behind closed doors).  To the employee, this signals more bad news is on the horizon and so the informal communications network starts humming about the “what ifs” and productivity takes a nose dive.  To the executive, the closed-door meetings are a necessity to concentrate on solving the crisis quickly.
Continue reading “Filling the Short Term HR Gap (aka – It’s about Leadership, Stupid!)” »

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Changing Landscape for Executive Bonuses

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expert perspective telescopeExpert Perspective by Grahall’s RObert Cirkeil

In a March 17, 2009 article in New York Times Times editor Andrew Ross Sorkin asks “Do we really have to foot the bill for those bonuses at AIG?” He supports the proposition on two fronts:

  1. It’s contractual and business would be worse off if the government “would start abrogating contracts left and right”; and
  2. that these bonuses retain folks who can a) fix the mess and b) if not incented to stay, “quite possibly, be put it to work at a competing firm against taxpayers’ interests.”


Continue reading “Changing Landscape for Executive Bonuses” »

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The Case for Paying Out Bonuses at A.I.G.

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Published in the New York Times, March 17, 2009 by Andrew Ross Sokin

Do we really have to foot the bill for those bonuses at the American International Group? It sure does sting. A staggering $165 million — for employees of a company that nearly took down the financial system. And heck, we, the taxpayers, own nearly 80 percent of A.I.G.  It doesn’t seem fair.

Link to full article.

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