Despite the sheer amount of companies filing for bankruptcy during the novel coronavirus, plenty of executives are still getting massive bonuses.
The bonuses for leaders of companies typically come into play shortly before a bankruptcy filing. This allows the CEOs and other leaders to collect the cash without having to wait for approval from a judge during the bankruptcy process.
- J.C. Penney (OTCMKTS:JCPNQ) — The retailer has been struggling for years and filed for bankruptcy on May 15, but not before handing out roughly $10 million in bonuses.
- Neiman Marcus — This retailer filed for bankruptcy on May 7 after paying leaders over $4 million in bonuses in the weeks leading up to that.
- Hertz (NYSE:HTZ) — The car rental company’s bankruptcy filing was made on May 22 and it handed out $1.5 million in bonuses to leaders just days before doing so.
- Whiting Petroleum (NYSE:WLL) — This bankruptcy was filed on April 1 and executives at the oil company received $14.6 million in bonuses shortly before that.
- Libbey (OTCMKTS:LBYYQ) — The glassware company filed for bankruptcy on June 1 but made sure to hand out bonuses of $3.1 million to leaders before filing.
- Borden — This dairy company paid out $2 million but had to get approval from a court as it was already undergoing bankruptcy.
- CEC Entertainment — The Chuck E. Cheese parent company hasn’t filed for bankruptcy just yet, but rumors say it will soon. Even so, it awarded CEO David McKillips with a $1.3 million bonus.
Brett Miller, head of data solutions at Institutional Shareholder Services, gave the following statement to The New York Times.
“The companies are creating certainty for their C.E.O.s at a time of the greatest uncertainty for the employee base and the company in general.
As of this writing, William White did not hold a position in any of the aforementioned securities.