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News Wire: CSX management layoffs to save company $175 million annually

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Posted by samfp1943 on Thursday, March 9, 2017 8:43 AM

[quote user="schlimm"]

[quote user="BaltACD"]Regardless of the reasons behind it, I'll take it - on behalf of my Grandfather's 47+ years, my Father's 37+ years and my 51+ years.[/quote 

135+ years of service and wisdom!  Amazing!  And that institutional wisdom is often lost or even devalued in today's short-term approach.

 

[/quote] ABSOLUTLY!  What a great legacy! Angel Bow

 

 


 

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Posted by schlimm on Thursday, March 9, 2017 8:38 AM

[quote user="BaltACD"]Regardless of the reasons behind it, I'll take it - on behalf of my Grandfather's 47+ years, my Father's 37+ years and my 51+ years.[/quote 

135+ years of service and wisdom!  Amazing!  And that institutional wisdom is often lost or even devalued in today's short-term approach.

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Posted by BaltACD on Wednesday, March 8, 2017 10:44 PM

samfp1943
At least Balt ACD got a control point named after him. on retiring !  Whistling 

Talk about perfect timing! IMHO! BowSmile, Wink & Grin

Not excatly a Control Point - a 2 mile Yard Limit.

Yard Limit is on the former South Baltimore Industrial Track.  Track was designated 'Other Than Main Track' by the Division.  However, once it got that designation MofW could not be protected on the track as Authorities only apply to Main Tracks and Yard Limits.  Thus to be able to give MofW protection on this segment of track a Yard Limit had to be created - I was just lucky enough to be retiring at the appropriate time.  Regardless of the reasons behind it, I'll take it - on behalf of my Grandfather's 47+ years, my Father's 37+ years and my 51+ years.

Never too old to have a happy childhood!

              

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Posted by samfp1943 on Wednesday, March 8, 2017 8:27 PM

tree68

Given Mantle Ridge's demand to be treated like a majority stockholder, even though they own only a small portion of the stock, I'd say that it's not CSX who wants EHH, it's Mantle Ridge who wants EHH, and they certainly don't want to pay for him out of their own pocket...

 

  The TRAINSNewswire for 03/08/2017 gives some of the details in a story about EHH's Compensation Package:

FTA:"...Harrison will receive a base salary of $2.2 million and an annual target bonus opportunity of up to $2.8 million, with that amount as a guaranteed bonus this year, CSX said in a regulatory filing.

Harrison also was granted options on 9 million shares of CSX stock at $49.79 – a deal worth $448 million at the current price. The option will vest in equal annual installments over Harrison’s four-year contract. Half the option will be based on continued employment, with the other half hinging on the achievement of performance targets.

At the CSX annual meeting, shareholders will vote on whether to reimburse Mantle Ridge and Harrison for the $84 million in compensation and benefits Harrison left on the table by leaving five months early from the top job at Canadian Pacific.

If shareholders approve the “make-whole” arrangement, CSX will pay Mantle Ridge $55 million
and later would pay Harrison $29 million and pick up the tab for taxes on the deal...

[The article further adds:] "...CSX’s corporate bylaws were amended to separate the roles of CEO and chairman of the board. In addition, the board’s mandatory retirement age of 75 was eased in a nod to the 72-year-old Harrison.

Mantle Ridge, which currently holds just under 5 percent of CSX’s stock, must retain a 2 percent stake in the company if founder Paul Hilal is to retain his seat on the board. Hilal is the board’s vice chairman through the 2018 annual meeting.

Mantle Ridge also agreed to vote in favor of all nominees to the CSX board in its proxy statement for the upcoming annual meeting..."

Apparently, Mantle Ridge and EHH were pretty confident that EHH was a 'shoe- in' for the CSX job(?) which is why he walked away from the milti-million 'Compensation package' on exiting CPR(?)

 With just a 5% holding of CSX stock [currently] and as it was noted in previous articles Mantle Ridge 'started' its' 'run' at CSX with an original holding of around 2%. I am not sure what that 'holding would be in cash value$$$$, but it certainly, seemed to be a pretty good reading of what it would take for the Management Team at CSX  to Fold'; it seems to beg the question of what information Mantle Ridge and EHH 'had on' CSX?  

At least Balt ACD got a control point named after him. on retiring !  Whistling 

Talk about perfect timing! IMHO! BowSmile, Wink & Grin

 

 


 

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Posted by tree68 on Tuesday, March 7, 2017 12:05 PM

Given Mantle Ridge's demand to be treated like a majority stockholder, even though they own only a small portion of the stock, I'd say that it's not CSX who wants EHH, it's Mantle Ridge who wants EHH, and they certainly don't want to pay for him out of their own pocket...

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Posted by RME on Tuesday, March 7, 2017 8:27 AM

Norm48327

 

 
RME

I doubt that would satisfy him.

Hasn't he already said that if he doesn't get the $84 million to 'make him whole' with his CP non-compete clause, he'll walk?  And that he expects to get it from the stockholders, not Mantle Ridge?  There's half of it right there...

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Posted by jeffhergert on Monday, March 6, 2017 9:18 PM

Ulrich

If they're older and close to retirement  then it would make more sense to let natural attrition take its course. One thousand managers is alot of people.. one has to wonder what is going on there when all of these people are suddenly deemed superfluous. And the timing is interesting too.. the war on coal is supposedly over, Trump is cutting corporate taxes and the economy is poised to come back stronger than ever..My guess is this is all a preamble to EH coming on board.. a bit of putting the cart in front of the horse so that when he finally does arrive his plan is already under way.

 

There was speculation that this was done purposely before EHH took over.  Not because they wanted to put the cart before the horse or get the ball rolling.  Rather, that Mr. Ward wanted to reward his people with a better severance package than they were likely to get from EHH once he was in charge.

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Posted by Norm48327 on Sunday, March 5, 2017 4:06 PM

RME
Or to have the $175 million in compensation to give him as a 'superstar'? Devil

I doubt that would satisfy him. It's become an ego thing that he needs to prove himself one more time before taking the filthy lucre and hitting the bricks. Seems to be the typical mindset of corporate execs these days; destroy the company and get a huge bonus for doing so. Pure unadulterated greed.

Norm


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Posted by RME on Sunday, March 5, 2017 3:42 PM

Murphy Siding
Ulrich

Or to be able to say that he's not now needed?

Or to have the $175 million in compensation to give him as a 'superstar'?  Devil

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Posted by Murphy Siding on Sunday, March 5, 2017 1:40 PM

Ulrich
..My guess is this is all a preamble to EH coming on board.. a bit of putting the cart in front of the horse so that when he finally does arrive his plan is already under way.
 

Or to be able to say that he's not now needed?

Thanks to Chris / CopCarSS for my avatar.

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Posted by Ulrich on Sunday, March 5, 2017 11:18 AM

If they're older and close to retirement  then it would make more sense to let natural attrition take its course. One thousand managers is alot of people.. one has to wonder what is going on there when all of these people are suddenly deemed superfluous. And the timing is interesting too.. the war on coal is supposedly over, Trump is cutting corporate taxes and the economy is poised to come back stronger than ever..My guess is this is all a preamble to EH coming on board.. a bit of putting the cart in front of the horse so that when he finally does arrive his plan is already under way.

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Posted by Randy Stahl on Sunday, March 5, 2017 7:57 AM

It looks like they are being offered a bridge to Medicare also. Added three years to age and months of service. I assume most of the affected employees are age 59-62.

Two years wages will go fast if they have to buy insurance.

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Posted by schlimm on Sunday, March 5, 2017 7:23 AM

n012944

 

 
schlimm
 

 

I wonder how many folks have received or know someone who received such a generous package?  "severance pay that equals two times their base salary plus......"

 

 

 

 

I know quite a few.

 

OK.  Good for them.  But we all know that the norm for most employees has traditionally been two months severance pay, at best.

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Posted by Randy Stahl on Sunday, March 5, 2017 6:17 AM

Ive never gotten anything quite that generous. I was happy with what I did get and I was still marketable.

 

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Posted by BaltACD on Saturday, March 4, 2017 9:11 PM

n012944
schlimm

I wonder how many folks have received or know someone who received such a generous package?  "severance pay that equals two times their base salary plus......"

I know quite a few.

Buyouts, which this is, are not cheap.  Do it on the cheap and you generate many enemies.  But it lets the accountants show it as a 'extraordinary' one time charge against income, no as a continuing employee with resultant fringe benefit liability.

Those who view annual reports tend to 'gloss over' extraordinary charges as the cause is explained in a footnote.  Normal employment expenses are always a continuing drain on income.

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Posted by n012944 on Saturday, March 4, 2017 7:05 PM

schlimm
 

 

I wonder how many folks have received or know someone who received such a generous package?  "severance pay that equals two times their base salary plus......"

 

 

I know quite a few.

An "expensive model collector"

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Posted by schlimm on Saturday, March 4, 2017 6:45 PM

samfp1943

 

 
BaltACD
 
schlimm
greyhounds
rockymidlandrr

You ain't never been in management, so I take it.

I recall the day the VP Intermodal got fired with no notice, but...

There was also the day the six sales territories were downsized to three sales territories.  They called three sales territory managers up to Chicago without telling them why.  The "Why" was that they were fired.  On the spot.  I remember one of them crying.

This is the way she goes.  If you can't stand the heat get out of the kitchen.  It's happened to me.  Not at the railroad, I quit there. But it's part of life and people have to deal with it.

Of course that totally ignores trends towards "golden parachutes" and other incentives and bonuses given to failed executives above middle management.

 

Those being let go by CSX are far from Golden Parachute territory.

 

 

 

     Sort of a combination of a 'One-Two Punch' for those who have risen by "The Peter Principle", and then fall because their 'parachute' had no shroud lines. [A failure to read small print in Employment Contract?] Whistling

    A relevant definition: " An Executive- One who is able to take a very long Lunch, and not effect anything, while out..."

 

I wonder how many folks have received or know someone who received such a generous package?  "severance pay that equals two times their base salary plus......"

 

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Posted by samfp1943 on Saturday, March 4, 2017 6:16 PM

BaltACD
 
schlimm
greyhounds
rockymidlandrr

You ain't never been in management, so I take it.

I recall the day the VP Intermodal got fired with no notice, but...

There was also the day the six sales territories were downsized to three sales territories.  They called three sales territory managers up to Chicago without telling them why.  The "Why" was that they were fired.  On the spot.  I remember one of them crying.

This is the way she goes.  If you can't stand the heat get out of the kitchen.  It's happened to me.  Not at the railroad, I quit there. But it's part of life and people have to deal with it.

Of course that totally ignores trends towards "golden parachutes" and other incentives and bonuses given to failed executives above middle management.

 

Those being let go by CSX are far from Golden Parachute territory.

 

     Sort of a combination of a 'One-Two Punch' for those who have risen by "The Peter Principle", and then fall because their 'parachute' had no shroud lines. [A failure to read small print in Employment Contract?] Whistling

    A relevant definition: " An Executive- One who is able to take a very long Lunch, and not effect anything, while out..."

 

 


 

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Posted by Miningman on Friday, March 3, 2017 8:50 PM

Ulrich- good one! Funny. 

That is a very good severance package. I would take that package all day every day...

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Posted by Ulrich on Friday, March 3, 2017 2:15 PM

schlimm

 

 
BaltACD
Those being let go by CSX are far from Golden Parachute territory.

 

Not too far. Silver parachute, then?  These terms are pretty good:  

"The laid off employees will be eligible for severance pay that equals two times their base salary, plus their target bonus and a prorated bonus payment. They also will be credited with three additional years of age and two additional years of service under the company pension plan."

 

 

That's a good severance package. With a payout like that there are probably some unhappy faces among those who weren't let go.."please pick me.. I've been a low flyer for years..totally useless..what's a train anyway?..".. 

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Posted by schlimm on Friday, March 3, 2017 11:08 AM

BaltACD
Those being let go by CSX are far from Golden Parachute territory.

Not too far. Silver parachute, then?  These terms are pretty good:  

"The laid off employees will be eligible for severance pay that equals two times their base salary, plus their target bonus and a prorated bonus payment. They also will be credited with three additional years of age and two additional years of service under the company pension plan."

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Posted by schlimm on Friday, March 3, 2017 11:04 AM

Ulrich

No golden parachute for middle managers.. only lead bricks. 

 

I said above middle management.

 

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Posted by Ulrich on Thursday, March 2, 2017 9:55 PM

No golden parachute for middle managers.. only lead bricks. 

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Posted by BaltACD on Thursday, March 2, 2017 3:52 PM

schlimm
greyhounds
rockymidlandrr

You ain't never been in management, so I take it.

I recall the day the VP Intermodal got fired with no notice, but...

There was also the day the six sales territories were downsized to three sales territories.  They called three sales territory managers up to Chicago without telling them why.  The "Why" was that they were fired.  On the spot.  I remember one of them crying.

This is the way she goes.  If you can't stand the heat get out of the kitchen.  It's happened to me.  Not at the railroad, I quit there. But it's part of life and people have to deal with it.

Of course that totally ignores trends towards "golden parachutes" and other incentives and bonuses given to failed executives above middle management.

Those being let go by CSX are far from Golden Parachute territory.

Never too old to have a happy childhood!

              

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Posted by schlimm on Thursday, March 2, 2017 3:15 PM

greyhounds

 

 
rockymidlandrr
Now management gets to experience what all the other crafts have over the past few years- day-to-day wondering if you have a job or not.

 

You ain't never been in management, so I take it.

I recall the day the VP Intermodal got fired with no notice, but...

There was also the day the six sales territories were downsized to three sales territories.  They called three sales territory managers up to Chicago without telling them why.  The "Why" was that they were fired.  On the spot.  I remember one of them crying.

This is the way she goes.  If you can't stand the heat get out of the kitchen.  It's happened to me.  Not at the railroad, I quit there. But it's part of life and people have to deal with it.

 

Of course that totally ignores trends towards "golden parachutes" and other incentives and bonuses given to failed executives above middle management.

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Posted by Ulrich on Thursday, March 2, 2017 11:37 AM

rockymidlandrr

Now management gets to experience what all the other crafts have over the past few years- day-to-day wondering if you have a job or not.

 

It's the "new normal". I for one have been working on straight commission for some 20 years now,  At least on commission one always knows where one stands.. no sale.. no commission. I don't miss the false security of a management position in a large company. 

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Posted by greyhounds on Wednesday, March 1, 2017 11:22 PM

rockymidlandrr
Now management gets to experience what all the other crafts have over the past few years- day-to-day wondering if you have a job or not.

You ain't never been in management, so I take it.

I recall the day the VP Intermodal got fired with no notice, but...

There was also the day the six sales territories were downsized to three sales territories.  They called three sales territory managers up to Chicago without telling them why.  The "Why" was that they were fired.  On the spot.  I remember one of them crying.

This is the way she goes.  If you can't stand the heat get out of the kitchen.  It's happened to me.  Not at the railroad, I quit there. But it's part of life and people have to deal with it.

"By many measures, the U.S. freight rail system is the safest, most efficient and cost effective in the world." - Federal Railroad Administration, October, 2009. I'm just your average, everyday, uncivilized howling "anti-government" critic of mass government expenditures for "High Speed Rail" in the US. And I'm gosh darn proud of that.
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Posted by rockymidlandrr on Wednesday, March 1, 2017 9:14 PM

Now management gets to experience what all the other crafts have over the past few years- day-to-day wondering if you have a job or not.

Still building the Rocky Midland RR Through, Over, and Around the Rockies
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Posted by schlimm on Wednesday, March 1, 2017 7:26 PM

NKP guy

   If they want to find real savings they might try looking at highly overpaid Executives.  But the CSX board (like most all boards) is composed entirely of such people to begin with.  Not one of them thinks he's overpaid.

   No, it's always teachers, laborers, firefighters, sanitation workers, HVAC workers, road crew workers, trainmen, conductors, dispatchers, etc. who are considered overpaid by board members.  Never Executives.

 

+1

 

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