You're fired — here's $9 million
Sacked Yahoo boss Carol Bartz lashed out at the company as she walked out the door with parting gifts most folks would envy. But as CEO perks go, $9.4 million in severance is pretty chintzy.
Earth to outgoing Yahoo CEO Carol Bartz: Yes, it's lousy to be fired. But that's no excuse for losing your cool and going on a foul-mouthed, public tirade.
Especially since Yahoo (YHOO.O) is handing you a sweet golden parachute as you walk out the door. Bartz leaves with nearly $10 million in severance for a job she held just 30 months. That's about $78,000 for each week worked — a parting gift a lot of laid-off employees would love to have.
And that's after huge paycheques for what the company, and a lot of investors, had to consider mediocre performance.
If there's any consolation for Yahoo's shareholders, it's that Bartz's plush goodbye isn't unusual for CEOs squeezed out of the front office. In fact, viewed from the perspective of a modern, highly paid chief executive, you might even call it stingy.
Bartz's parting shots
Certainly, millions in severance after earning great pay didn't satisfy Bartz.
In case you missed it, after getting the news last week that she had been axed, the outgoing Yahoo CEO wasted no time unleashing a profanity-laced attack on her former employer. She came off as more like a guest on "The Howard Stern Show" than a polished CEO worth the mega-millions she was pulling down.
The tamest part of the assault, launched in an interview with Fortune magazine: calling the Yahoo board members who dismissed her "doofuses." Things just went downhill from there, with Bartz saying the board "f___d me over," and taking a profane shot at Yahoo board Chairman Roy Bostock for using a script to fire her over the phone.
That's admittedly a lame way to dismiss someone, but — ouch! No doubt this will come up in her next job interview.
I do understand why Bartz is miffed. "Most executives, even the ones who are very secure, don't like being fired. This is a terrible experience for them, just like it is for anybody," says Jotham Stein, a Silicon Valley employment lawyer who has represented more than a few axed executives.
But let's be honest. Few of the folks reading her statements are going to shed tears for her. Financially, she's going to be fine.
As I mentioned, she's leaving Yahoo with $9.4 million in severance, as calculated by the compensation research firm Equilar, of Redwood Shores, Calif. (Press reports put it a little over $10 million, but after a certain point, who's counting?)
Her pay for this year has not yet been disclosed, but she earned $59.2 million in pay during her first two years on the job — about $8.3 million in cash, the rest in equity, according to Equilar.
And during her 30-month stint, the Internet giant stumbled badly.
Yahoo sales fell 10 per cent, to $6.46 billion, in Bartz's first year on the job, 2009, even though the economy came out of recession midway through the year. Then revenue fell by two per cent last year. And sales plummeted 25 per cent to $2.4 billion in the first six months of this year. Yahoo stock rose only 12 per cent to $13.61 from the time she started in early February 2009 to the day before she was let go, while the Nasdaq advanced 70 per cent.
Given those results, a $9.4 million farewell would sound pretty good to the millions laid off during the recession. But from the front office, things look quite different.
MSN.ca Money's editorial goal is to provide a forum for personal finance and investment ideas. Our articles, columns, message board posts and other features should not be construed as investment advice, nor does their appearance imply an endorsement by Microsoft of any specific security or trading strategy. An investor's best course of action must be based on individual circumstances.