Monday, November 17, 2008

The bonus of parsing the fine print

A lot of people are agog over the fact that Goldman Sachs is not giving out bonuses this year. I urge such people to look deeper than just the attention grabbing headlines. The truth is that only 7 employees in Goldman are not getting bonuses. The rest of the employees are collectively pocketing 7 billion dollars in bonuses.

Now it looks like other banks are following the same strategy. Produce eye popping headlines and hide the dirty laundry in the fine print. Today’s headline splashed across the online Times read the following: Top Executives at UBS Will Not Get Bonuses.

Until I got to the fine print:
UBS said that its chairman, its chief executive, and other members of the executive board would receive only fixed salaries this year and that all other UBS employees would get lower 2008 bonuses.

1 comment:

Anonymous said...

All other employees are peons like us. UBS executives deliberately pays low base salaries to their lower level employees so they can provide lower benefits (such as life insurance) to us (based on the base salary only). The rest of our paycheck are given to us as "bonuses".

A bonus of the company officers and a "bonus" for a lower level employee is not the same thing-believe me!