Lineandinitial
Legio patria nostra
Every year we seem to have more to do and we get less for doing it.
Changes in Management Compensation?
- Thread starter Catatonic
- Start date
tieguy
Banned
I think its changed. not sure if its a loss until I find out how the lost quarter of MIP will be accounted for.
For me it looks like a move to eliminate some cost at the expense of tradition.
like any other change we tend to look past the given explanation to see if there are other reasons.
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brownmonster
Man of Great Wisdom
I liken it to the preload. Long term, highly paid employees are better for service but tough on the bottom line. Less costly to constantly keep filling the position with cheap labor figuring in misloads as a trade off. Once the current group of long term mgmnt is gone it will be a never ending stream of people coming and going. Moving from a fixed pension to a 401k for future mgmnt only confirms it. The benefits of experience don't show up on a spreadsheet.
When I was a supervisor at UPS, I put in well over the 40 hour work week consistently through out the year and I never complained one bit on that because I did get MIP and other benefits, but that was more than 3 years ago. Every year at Christmas and for peak we were given the 'normal lecture' that your 1/2 month bonus was for the extra work you put in during peak and that you were expected to pick up the pace that much more and be actively involved in the operations and getting the packages delivered while maintaining your core job, whatever that may be. The hours were insane during peak and seriously sleep deprived, but I did it because they were providing this compensation and it was told to us that it was given specifically for the extra work in peak season.
To have it spread out over the year does mask the whole concept of it being for the work done during peak and I always looked forward to it as an extra bonus to help get special gifts for family and friends for Christmas. That would stink to me and I would have a hard time wanting to work extra for peak even if I did get the extra money through out the year cause I am not seeing the direct gain right when I am putting the extra work in. That can affect motivation. Don't get me wrong, brown blood flows through me, and I would do what it took to do the job, I just think it stinks. It's also kind of traditional and it's taking some of what UPS has been known for away from what UPS is now.
This leads into the turkey thing. Of all things, this breaks my heart. UPS always had the tradition of the turkey and if you didn't want it you could donate it or give it to someone in need, but they always did it. Maybe with an exception during the depression or something. I can't remember exactly, but it is a time honored tradition and it takes away from the core of what UPS is to me. It was a small thing, but everyone was involved and it wasn't so much an expectation but a continuation of a tradition held within UPS.
MIP - Sounds like to me they are putting off paying to make themselves look good temporarily and then by spreading it out they are essentially just (well just my opinion) trying to make their bottom line look better to the public. Whatever the MIP is, it is, and why not just pay that out right and be done with it rather than drag it out, unless, it's to hold supervisors and management there because if they leave, then the lose whatever MIP they could have gotten through out 2011 -2012. I don't know. Seems fishy to me. And the factor in the MIP is rather bogus in itself and there is or has always been the reality that the stock price goes down on the day that MIP is set. So, whatever they set MIP to be they can always say they factored in the extra pay to make up for the quarter lost here in 2010, but there is no backing or proof to it and they can't be held accountable to it because it's an incentive. So they don't have to prove anything and could essentially take the option away as it is an incentive. I wouldn't imagine that being a really good plan but it sounds like to me it's already heading out the door. Just my opinion though.
It's sad because, while I understand that drivers, hub workers, and many others put in their time and go above an beyond (or at least did when I was there), but they were compensated hourly and based on performance. Management and Supervisors, if you make your goal (and that is if), your lucky to get a pay raise and I hear that might have even not happened this year or last year, and the salary is essentially based on a 40 hour work week and I never knew a single individual who worked a 40 hour work week in my district. So, while the salary may look good, when you spread it based on the hours to do the job and what they expect of you, it's not all that much. So, the incentives are rather important to hold what motivation you can muster and to keep people engaged in doing what is right for the company. Not saying that is totally gone cause I know that many here are committed UPS employees, just sharing where I see the decline in motivation from new hires coming from.
Just my 2 cents that is all. Not trying to upset. Just sharing an opinion. It's sad to me. UPS is like any other company now just trying to hold on to the bottom line, make their dollar look good and whatever money they can hold on to, they will. After all, it's all about profit. Employee and to an extent some customer satisfaction went out the window I know well before I left.
Heather
To have it spread out over the year does mask the whole concept of it being for the work done during peak and I always looked forward to it as an extra bonus to help get special gifts for family and friends for Christmas. That would stink to me and I would have a hard time wanting to work extra for peak even if I did get the extra money through out the year cause I am not seeing the direct gain right when I am putting the extra work in. That can affect motivation. Don't get me wrong, brown blood flows through me, and I would do what it took to do the job, I just think it stinks. It's also kind of traditional and it's taking some of what UPS has been known for away from what UPS is now.
This leads into the turkey thing. Of all things, this breaks my heart. UPS always had the tradition of the turkey and if you didn't want it you could donate it or give it to someone in need, but they always did it. Maybe with an exception during the depression or something. I can't remember exactly, but it is a time honored tradition and it takes away from the core of what UPS is to me. It was a small thing, but everyone was involved and it wasn't so much an expectation but a continuation of a tradition held within UPS.
MIP - Sounds like to me they are putting off paying to make themselves look good temporarily and then by spreading it out they are essentially just (well just my opinion) trying to make their bottom line look better to the public. Whatever the MIP is, it is, and why not just pay that out right and be done with it rather than drag it out, unless, it's to hold supervisors and management there because if they leave, then the lose whatever MIP they could have gotten through out 2011 -2012. I don't know. Seems fishy to me. And the factor in the MIP is rather bogus in itself and there is or has always been the reality that the stock price goes down on the day that MIP is set. So, whatever they set MIP to be they can always say they factored in the extra pay to make up for the quarter lost here in 2010, but there is no backing or proof to it and they can't be held accountable to it because it's an incentive. So they don't have to prove anything and could essentially take the option away as it is an incentive. I wouldn't imagine that being a really good plan but it sounds like to me it's already heading out the door. Just my opinion though.
It's sad because, while I understand that drivers, hub workers, and many others put in their time and go above an beyond (or at least did when I was there), but they were compensated hourly and based on performance. Management and Supervisors, if you make your goal (and that is if), your lucky to get a pay raise and I hear that might have even not happened this year or last year, and the salary is essentially based on a 40 hour work week and I never knew a single individual who worked a 40 hour work week in my district. So, while the salary may look good, when you spread it based on the hours to do the job and what they expect of you, it's not all that much. So, the incentives are rather important to hold what motivation you can muster and to keep people engaged in doing what is right for the company. Not saying that is totally gone cause I know that many here are committed UPS employees, just sharing where I see the decline in motivation from new hires coming from.
Just my 2 cents that is all. Not trying to upset. Just sharing an opinion. It's sad to me. UPS is like any other company now just trying to hold on to the bottom line, make their dollar look good and whatever money they can hold on to, they will. After all, it's all about profit. Employee and to an extent some customer satisfaction went out the window I know well before I left.
Heather
pretzel_man
Well-Known Member
I decided to call a friend in corporate compensation today. She said that the salary ranges and mid points would move up 4.2% to compensate for the 1/2 month check change.
So, new supervisor used to come in at 90% of midpoint. Assuming he/she still comes in at 90% of midpoint the yearly pay is the same.
Your argument of taking advantage of new supervisors could exist in all cases. All corporate would have needed to do is lower the midpoint or bring people in at a less percent of the mid than before.
When new people are told of their pay, it includes MIP and 1/2 month. If the intent was to hide the change, it would have been very obvious when the total package was presented.
tieguy
Banned
I'm not ready to take it to the "taking advantage of new supervisors" level. I think the plan is to eliminate it and this is the quick and quiet way to do so.
tieguy
Banned
pretzel_man
Well-Known Member
I guess all I'm saying is that there are other easy ways to eliminate the 1/2 month compensation (if they wanted to).
They could have left the 1/2 month in, and reduced raises by 1.5% for 3 years.
Personally, I liked the 1/2 month because I was nice for christmas presents. I think people will not save the money all year long.
So, while I'm not a fan of the change, I do not see it as a sign of more future elimination.
FracusBrown
Ponies and Planes
What is the benefit to the company in changing the compensation structure?
If the management people aren't loosing anything, how can the company gain anything? If it's a wash, why change it?
It seems to me that holding on to an extra $100 million or so would be beneficial to the company. Why pay it out early? The interest on a $100 million has to outweigh the expense of processing the checks.
If it makes sense to pay out the bonus early in equal increments, why not pay out MIP early? There has to be something more to the plan.
Lineandinitial
Legio patria nostra
"When new people are told of their pay, it includes MIP and 1/2 month. If the intent was to hide the change, it would have been very obvious when the total package was presented."
When I came on I specifically recall language regarding the 1/2 Month as being "In addition to". Back in those days it was a handshake as UPS was the Employer that "took care of its Employees"; and they did. I was a guy really wanting to be Brown!!
I was very happy with the Company in the 1980's and 1990"s.
I miss my Turkey and I will definitely miss my 1/2 month. It made Peak special and understandable to my Family. I guess I need a Christmas Club now to show them how my Employer values my commitment and the extra load on m y Family during the Holidays.
I'm going to KXXX this Peak and I won't be home until Christmas Eve. Missing Returning Children/ Family Gatherings / Friends' Gatherings/ etc................No one seems to understand the Human Side of this.
Heather...nice Post
When I came on I specifically recall language regarding the 1/2 Month as being "In addition to". Back in those days it was a handshake as UPS was the Employer that "took care of its Employees"; and they did. I was a guy really wanting to be Brown!!
I was very happy with the Company in the 1980's and 1990"s.
I miss my Turkey and I will definitely miss my 1/2 month. It made Peak special and understandable to my Family. I guess I need a Christmas Club now to show them how my Employer values my commitment and the extra load on m y Family during the Holidays.
I'm going to KXXX this Peak and I won't be home until Christmas Eve. Missing Returning Children/ Family Gatherings / Friends' Gatherings/ etc................No one seems to understand the Human Side of this.
Heather...nice Post
brownmonster
Man of Great Wisdom
Considering the hours you folks put in during peak I can see why the 1/2 half month bonus will be missed. Even though it comes out in the wash, it's not the same as getting the extra cash at Christmas when you need it. My wife has a Christmas club account at work. $50 a week. $2600 for the Holidays is beautiful!
Lineandinitial
Legio patria nostra
Brown... It wasn't getting it...It was WHEN we got it............Like the end of a big task...Like drinking beer at the end of an activity (moving/etc) with a Friend. Legacies and Traditions..........
Lineandinitial
Legio patria nostra
Brown
Misread or didn't read the last sentence.
Yes.....Exactly
Misread or didn't read the last sentence.
Yes.....Exactly
It really is essentially going back to foundations and traditions and that extra push that is given at the end of the year. Granted I have been out for 3 1/2 years, but it's just like yesterday that the hours put in were so unreal. No sense of human need involved in the equation. You know, basic necessities like sleep just don't get factored in at peak but yet we did it because there was that extra special piece and you felt good supporting a company that was also supporting you in tradition and a cores sense of value. Where is that now? I look back on Jim Casey and how he didn't have much in regards to family and his whole life revolved around the development of what became UPS and I believe he was essentially living out of hotel rooms for parts of his life traveling. I look back at the boss I had when I was working and much of his family was not pleased with him. His life revolved around brown and the brown blood. Brown blood runs through me today and if I was working there now I would be totally 100 % and more involved in everything that was going on and when peak came it was just that much more. But, they are taking away bits and pieces of the foundation of or core of some basic principles. It's like the stupid turkey. Yeah it's just a turkey, but it was a tradition, it had meaning. I see a major paradigm shift. I saw it when I was leaving and I see it even more now and it's sad to me. It's all about the numbers and it always has been. It's all about the profit. UPS wouldn't be in business if it wasn't about the profit, but at what point do you sacrifice the foundation, the principles, the employees, the community (aren't are families apart of that community) and continue to function. UPS will still function, but it is a slow decay. But that's just my opinion. And it's not just management, it's everywhere in UPS. A guy at my church works for UPS freight and just moved into a supervisor position and he is living the same life I lived when I was a supervisor. His peak is different, but it's become the same thing. Who cares about your family and your health. Get the packages from point A to point B extremely fast and don't put UPS in any liabilty, then go home without overtime or if your management work the hours to make up for those who can't work the overtime and work the 100 hour work weeks. How much are you really worth when you tack in that MIP and 1/2 month bonus plus salary into an 80-100 hour work week? It gets down to below minimum wage and yet you think you are getting paid good money. I sat in a UPS building one day working on my own work and listened as drivers called in dropping out like flies because of the heat - Is their health worth it, does anyone care? In my case I had mental health issues - did anyone care know. You have thick skin. You work, people throw you in the garbage, it's okay, pick yourself up, dust yourself off, and keep going. The day I left a manager locked themself in their office and wouldn't come out having a total mental breakdown. So, does it surprise me that the people that are coming to work for UPS don't have the drive or motivation... No, it doesn't. It's not worth it. No money and no job is worth risking your life for.
Yeah at least the MIP is coming and at least they are still doing the half month even though it is spread out over the year, but you guys are right that they are saving millions by not dishing it out now and gaining interest on it as well as making themselves look good with good numbers, but they are putting off the inevitable cost of paying the employee and (to me) it just seems like the slow transition into weeding or eventually removing it all together.
The question I ask now, is do they really need the people with heart and that brown blood anymore? They are dummy proofing jobs everyday making it so that you are just as expendable as the next guy. Is your brown blood going to provide you any opportunities in the future? Especially if they can put someone in your place to work for less money with less experience cause they have dummied up the job. And they don't need the people working the long hours so much anymore in the hourly side cause they are gonna push the driver helpers and they want someone who only wants their 9-5 anyway. No overtime then no extra cost or pay boils down to less money they are forking out on their bottom line and that is more profit and money in their pocket. And if they can just keep pushing management and supervisors harder and harder then they can get them to essentially work for less money eventhough they think they are getting paid more with all the incentives and such.
I don't mean to be a negative person and put this all in a bad light, I just don't see what is happening as being something that is, in the future, going to benefit the company. the core mission, foundation, principles this company was founded on brought us this far. Why does it need to change? I am not opposed to change and certainly in an ever changing environment things constantly need to be reevaluated, but you might as well paint the cars a different color and give a whole new name cause it just isn't UPS to me anymore.
Sorry. lol. I guess I needed to vent. I apologize.
oompaa/heather
Yeah at least the MIP is coming and at least they are still doing the half month even though it is spread out over the year, but you guys are right that they are saving millions by not dishing it out now and gaining interest on it as well as making themselves look good with good numbers, but they are putting off the inevitable cost of paying the employee and (to me) it just seems like the slow transition into weeding or eventually removing it all together.
The question I ask now, is do they really need the people with heart and that brown blood anymore? They are dummy proofing jobs everyday making it so that you are just as expendable as the next guy. Is your brown blood going to provide you any opportunities in the future? Especially if they can put someone in your place to work for less money with less experience cause they have dummied up the job. And they don't need the people working the long hours so much anymore in the hourly side cause they are gonna push the driver helpers and they want someone who only wants their 9-5 anyway. No overtime then no extra cost or pay boils down to less money they are forking out on their bottom line and that is more profit and money in their pocket. And if they can just keep pushing management and supervisors harder and harder then they can get them to essentially work for less money eventhough they think they are getting paid more with all the incentives and such.
I don't mean to be a negative person and put this all in a bad light, I just don't see what is happening as being something that is, in the future, going to benefit the company. the core mission, foundation, principles this company was founded on brought us this far. Why does it need to change? I am not opposed to change and certainly in an ever changing environment things constantly need to be reevaluated, but you might as well paint the cars a different color and give a whole new name cause it just isn't UPS to me anymore.
Sorry. lol. I guess I needed to vent. I apologize.
oompaa/heather
pretzel_man
Well-Known Member
I have talked to many people in corporate and cannot see any huge beneift to the company or unterior motive. Let's look at it....
1/2 month: There must be some simplified processing, by not having to complete 30,000 extra checks at the beginning of the year.
MIP: There is certainly a time value of money savings to the company. They will defer a payment for 3 months. The deferred payment applies only to the cash portion I think. (remember, they will also give you one month's pay, so I'm not sure how much the time value of money savings is) MIP is already accrued monthly in the books.
LTIP / LTI: They eliminated extra correspondence, materials, etc.
Ownership guidelines: I'm unclear about this one.... Seems that they have seperated the ownership guidelines and how the 1/2 month is calcualted, nothing more... They "may" put some teeth in the guidelines now. I think that would be good.
I do not know if you have the complete material, presentation, and FAQ's. I do and have read them multiple times.
They say that there are some simplified processes as mentioned above. They also say it aligns MIP to the fiscal year. Finally they say that there is not a cost savings for the company.
The examples as well as my own calculations do not show any loss to the employee. (They show a small increase).
Will a "gotcha" come? I don't know. I just don't see it now.
BTW, I liked the old program. I liked getting the extra 1/2 month check. I liked all the incentives seperated. I'm just saying I don't see problem with this one.
only thing I see is in the long run is that they are cashing out future half month obligations at current salary levels. For example, my half month in 10 years (when I am a District manager) would have been far more than the level at which the program was cashed out to me based on my mid level mgr salary....I'm fine with it--may even prefer having it put into my salary--...and I'm not District Manager material anyway.
beentheredonethat
Well-Known Member
Pretzel..
1. As far as processing the 1/2 month payroll. I (a long time ago), was in payroll and did the 1/2 month paycheck for mgmt. This process took all of 4 hours. Having a consolidated site, will make that even faster. The one thing I see that will save is all those checks not having to be mailed out. But that's pretty minor.
2. MIP already being accrued. YOu are dead right, and this is really where the company is making their savings. All they need to do for the fiscal year 2011, is accrue for a small MIP payout (what did they say the max was, 1 month? So that is the huge savings for the fiscal year for UPS. In 2012, they will accrue that cost throughout the year, and the amount total that they pay in 2012, will be less by the payout in Dec 2011. A win win for UPS.
3. Ownership guidelines. If upper mgmt where doing a better job and getting the company to grow more, we wouldn't need incentives to keep the stock. When it was growing at 10-20% per year, people were borrowing to own more, borrow at 5% and earn 20% was a great deal. Lots of older mgmt made a lot doing that. But, now the stock hasn't really grown for years now (esp like it used to). The BOD and mgmt committee are responsible for long term share price growth. They've been doing a pretty bad job on that.
pretzel_man
Well-Known Member
Been there:
Not sure I understand your points. Or mayb we do not disagree...
1: 1/2 month. My point was that there was no major savings to the company here. Maybe small processing improvemnts
2: When the 2011 Khalix reports come out, we will see if you are correct. The current budgets have the MIP accruals in there each month with no changes. Since MIP has been accrued monthly forever, I doubt there will be a change. BTW, the 1/2 month was already accrued monthly in the cost statements. For the MIP, UPS does save the time value of the money (maybe). Since they will pay in cash the 1 month pay in 2011, that savings may not exist either. In addition, the payment of the 1/2 month check means the company is losing the time value of that money.
3: I agree with you. But...... This means that we need to support decisions they make trying to get the company to grow. (assuming they are not stupid).
Personally, I would rather have less in my paycheck if it means the difference can be used for growth initiatives. A growing stock is much more important than the MIP factor or a monthly check. When I first started receiving MIP, a 2.0 was huge.
Follow the link on this site under news.That states UPS files sec 8
CleverNick
Member
I have read a lot of comments on this thread and also on UPSers.com bemoaning the loss of the half month bonus. Maybe it's because I have "only" been with the company for 9 years, but I don't understand the opposition to it. It seems like there are two main arguments against the half month bonus change:
1. It is "tradition" to get a little extra something during peak.
2. It is nice to get a lump sum before the holidays for gifts and stuff.
Regarding argument #1, the change improves upon tradition in that now we have access to the half month bonus sooner. Financially speaking, we are almost always better off getting money sooner rather than later. You can take the money and stick it in an online savings account, and earn an extra couple bucks on it rather than waiting until November and getting the money without any interest. I am tempted to offer those who want to maintain this "tradition" a deal. You give me your extra 4.2%, I'll deposit it in a savings account, and then in November, I'll give you your half month bonus and I'll pocket the interest. It is a win-win. You get to keep your tradition, and I get to pocket a little extra income at your expense.
Secondly, they are bumping up our base salaries by 4.2%, which is actually MORE than the half money bonus. By my math, half month bonus is actually 4.1666666%, so we are getting an extra fraction of a percent. Yes, it isn't much, but I'll take more money over less money any day!
Regarding liking to have an extra bonus for the holiday, you can just take 4.2% of your salary every month, stick it in the bank, earn a little extra interest, and not touch it until the holidays. If you don't have the financial discipline to do this, then that's a "you" problem, not a UPS problem.
1. It is "tradition" to get a little extra something during peak.
2. It is nice to get a lump sum before the holidays for gifts and stuff.
Regarding argument #1, the change improves upon tradition in that now we have access to the half month bonus sooner. Financially speaking, we are almost always better off getting money sooner rather than later. You can take the money and stick it in an online savings account, and earn an extra couple bucks on it rather than waiting until November and getting the money without any interest. I am tempted to offer those who want to maintain this "tradition" a deal. You give me your extra 4.2%, I'll deposit it in a savings account, and then in November, I'll give you your half month bonus and I'll pocket the interest. It is a win-win. You get to keep your tradition, and I get to pocket a little extra income at your expense.
Secondly, they are bumping up our base salaries by 4.2%, which is actually MORE than the half money bonus. By my math, half month bonus is actually 4.1666666%, so we are getting an extra fraction of a percent. Yes, it isn't much, but I'll take more money over less money any day!
Regarding liking to have an extra bonus for the holiday, you can just take 4.2% of your salary every month, stick it in the bank, earn a little extra interest, and not touch it until the holidays. If you don't have the financial discipline to do this, then that's a "you" problem, not a UPS problem.
