So THAT's Why They Can't Afford a Decent Wage Increase...
It's Tough At The Top

Cynthia Wiggins

A recent report of a Financial Times survey on the salaries for the top Canadian executives shed tears over the tough year executives from the level of vice-president and up suffered in 1990. Excuse me if I don't share the sentiment. The salaries for the 235 executives was 449,000 each on average. And they granted interest-free loans for the purchase of stocks and homes amounting to $22 million. Low interest loans totalled a further $18 million. Seven executives who retired during the year each received an average of $341,000 in retirement and severance allowances.

It's difficult to weep for Arden Haynes whose salary as Chairman of Imperial Oil dropped from $1.26 to $1.18 million. Nor can one feel for R.V. Smith, President of MacMillan Bloedel, whose salary was cut in half from $625,000 to $350,000, but who was given an interest-free loan of $1.5 million to purchase stock. In total, the top five executives of this company received $1.2 million in salary and $2.4 million in interest-free loans.

Of 41 executives at the CEO level, 23 received salary increases of 30 per cent each on average. For the 20 executives in the class of president or CEO, 11 received an increase in salary of 31 per cent each on average. Of 99 vice-presidents, 66 saw their salary and benefits rise by 46 per cent on average.

The chairman and CEO of Gulf Canada Resources must have smiled all the way to the bank. While investors in the company lost 31 per cent on their investment, K. McWalter waltzed off with a 389 per cent pay increase totalling $2.8 million, including a $1.3 million retirement bonus.

Remember Varity Corporation, the company that shuffled off to Buffalo in 1990? The Federal and Ontario provincial governments wrote off $200 million in loans to Varity in 1986 in return for guarantees of keeping jobs and a head office in Canada until 1993. The 6,000 jobs that the governments hoped to save by the bailout have all been lost, as have 500 others at its Windsor auto plant which was shut down later in 1990.

Canadian taxpayers and workers helped make Victor Rice, the chairman and CEO of Varity, a millionaire. His 1990 income was $2.6 million with perks and bonuses and he received $2.5 million in interest-free loans to purchase stocks. In total, the top seven executives of Varity received $5.5 million in interest-free loans from the company during 1990.

A close examination of this survey reveals some interesting facts. Perks, for example, include bonuses, stock options, interest-free loans for housing and stocks, personal benefits, tax reimbursements and company contributory savings plans for employees. I guess this is why employers cannot afford to give workers decent wage increases.

Life at the bottom should be so tough.

(CX5035)

Donate or Volunteer