Changes in Management Compensation?

[Anonymous 10]

Pretzel, if you really believe that, I've got a few bridges to sell you.
First... Let's get to the glaring issue. Although UPS said we'd get a partial MIP in Dec 2011 it's basically from the 2012 payment. We are losing the 4th qtr 2011 in MIP. Gone. Also they are spreading the 2011 MIP over two calendar years, partial payment in 2011 and the rest of the yearly MIP in 2012. So UPS shows less cost for mgmt for two years with this one change alone.

Let's see what else we can all remember we've lost over the years.
Here's from what I can remember.

1. Medical benefits. Used to have no medical costs. I pay out over 500/month between medical coverage and flex to pay for my family's medical cost. Usually, I still have out of pocket beyond this. That's 6,000 per year I make less then before.
2. MIP used to give us an interest free tax free loan on the amount of the social security tax from the MIP benefits. UPS loaned us back the 6.2% of social security tax and took it back over 10 months as an interest free loan.
3. Holiday turkey - not much money. but a nice tradition gone.
4. Vacations.. My first year at UPS, I had no vacation, but I could borrow one from the next year. All vacations taken in a year were earned the year prior. Magically one year they changed it and vacations are earned in the year they were taken. Now the liability they took off their books benefited UPS, but we didn't get a payout from the vacation weeks we were owed. Granted this only negative affects us if we quit. If we retire we can still get the last year of vacations. (how long will it be before that is gone?)
5. Mystery MIP numbers. Does anyone truly believe that if we had used the old formula of 15% of the profits vs the mgmt payroll we wouldn't have had a much higher MIP these last few years?
6. MIP -now partially given in RSU. If you stay with UPS, not too big a deal. But for anyone who leaves, they lose a lot of stock in form of RSU's that disappear.
7. One year of no raises. This was something that still affects us since our base is always lower then it otherwise should be.
8. Expense acct. Used to be all miles were paid at the IRS max level which now is $.50/mile. I forgot when, but now after 1,000 miles, the reimbursement is $.19 per mile.
9. G.O. closures - Corporate relocated certain high level mgrs (district mgrs) who in effect stayed in the new district structure. But all other people now just has a new work location and has to pay for the extra long commute themselves. Or people moved themselves to keep their job.
10. The list can go on.. But I just get more upset as I write these down.

Almost all the time they do this, it is
A. To better align UPS with the competition.
B. No cost changes to employees\UPS. Just redefining how we do things (Pretzel).

In fact, it's to reduce cost on the back of mgmt. They can get away with it due to poor economy. But I see a big exodus when the economy rebounds and no reason for a new supv to want to stay. I see getting new supervisors will be more and more difficult.

Short term. I think for UPS this is good for them. In 10 years or so. I think they will wonder why the mgmt talent has gone downhill.

don't worry it will get better I promise!

 

[FracusBrown]

Pretzel, if you really believe that, I've got a few bridges to sell you.
First... Let's get to the glaring issue. Although UPS said we'd get a partial MIP in Dec 2011 it's basically from the 2012 payment. We are losing the 4th qtr 2011 in MIP. Gone. Also they are spreading the 2011 MIP over two calendar years, partial payment in 2011 and the rest of the yearly MIP in 2012. So UPS shows less cost for mgmt for two years with this one change alone.

Let's see what else we can all remember we've lost over the years.
Here's from what I can remember.

1. Medical benefits. Used to have no medical costs. I pay out over 500/month between medical coverage and flex to pay for my family's medical cost. Usually, I still have out of pocket beyond this. That's 6,000 per year I make less then before.
2. MIP used to give us an interest free tax free loan on the amount of the social security tax from the MIP benefits. UPS loaned us back the 6.2% of social security tax and took it back over 10 months as an interest free loan.
3. Holiday turkey - not much money. but a nice tradition gone.
4. Vacations.. My first year at UPS, I had no vacation, but I could borrow one from the next year. All vacations taken in a year were earned the year prior. Magically one year they changed it and vacations are earned in the year they were taken. Now the liability they took off their books benefited UPS, but we didn't get a payout from the vacation weeks we were owed. Granted this only negative affects us if we quit. If we retire we can still get the last year of vacations. (how long will it be before that is gone?)
5. Mystery MIP numbers. Does anyone truly believe that if we had used the old formula of 15% of the profits vs the mgmt payroll we wouldn't have had a much higher MIP these last few years?
6. MIP -now partially given in RSU. If you stay with UPS, not too big a deal. But for anyone who leaves, they lose a lot of stock in form of RSU's that disappear.
7. One year of no raises. This was something that still affects us since our base is always lower then it otherwise should be.
8. Expense acct. Used to be all miles were paid at the IRS max level which now is $.50/mile. I forgot when, but now after 1,000 miles, the reimbursement is $.19 per mile.
9. G.O. closures - Corporate relocated certain high level mgrs (district mgrs) who in effect stayed in the new district structure. But all other people now just has a new work location and has to pay for the extra long commute themselves. Or people moved themselves to keep their job.
10. The list can go on.. But I just get more upset as I write these down.

Almost all the time they do this, it is
A. To better align UPS with the competition.
B. No cost changes to employees\UPS. Just redefining how we do things (Pretzel).

In fact, it's to reduce cost on the back of mgmt. They can get away with it due to poor economy. But I see a big exodus when the economy rebounds and no reason for a new supv to want to stay. I see getting new supervisors will be more and more difficult.

Short term. I think for UPS this is good for them. In 10 years or so. I think they will wonder why the mgmt talent has gone downhill.

Nice recap!

Don't forget the reductions in pension and the reinstatement of the 401k match at .5 percent less and the realignment of pay raises that led to prorated raises that last a lifetime. Also, keep in mind that you have been given the responsibility of the next level through reductions, but you still get the pay of the lower level.

More to come, I'm sure. The first year is the "sell" year where they make it look good.

 

[FracusBrown]

its an effort to eliminate the xmas bonus for future supervisors. no fuss no muss we wont complain for the unborn.

someone crunched the numbers and figured out a benifit to awarding MIP in march. It may be something as simple as keeping retiring management around through peak. presently you have to be on the books through november 4th to get your mip. with the chanage I would think the date will be december 31st.

not sure about the mumbo jumbo change concerning what was called good partner money. You still have to retain x amount of shares to get a full month of additional incentive. The percentage calculation would appear to allow for flucuations in the share price.

A supervisor needs 3.5 percent to get a full month of additional incentive. A quick calculation would be to take your monthly salary and divide by .035 for a sup or .030 for a manager. Example for a supervisor 5000 divided by .035 equals 142857$ in class A share value to get a full month of additional incentive.

if the share price drops then you would need more shares to continue earning the same additional incentive. Just think corporate could warn or in some other way manipulate the share price and actually cut their liability.

corporate lives and speaks a different language that can add to the mistrust with these changes. Explaining the reason as a realignment that more closely realigns business plan to incentive sounds good but probably escapes most of us.

There's a big reduction in current year expenses by moving the payment to the next year. By delaying the payment they boost current year earnings by approximately $500 million.

 

[Lineandinitial]

I feel like the union employees are getting more at my expense. (OK...Bad Partner)

 

[beentheredonethat]

Good additional points. Plus for new mgmt, the pension that we know, they'll never see. It's the way to have in essence two tiers of mgmt. similar to what will probably happen in next contract with teamsters. Two tiers of drivers for thier pay.

 

[DS]

Tie ,remember this?
08-08-2002 11:37 PM #8
tieguy
Anonymous
To me the jury is still out on OPL. The investment cost me nothing. With dividends already received the Return on investment is somewhere around infinity.

 

[Anonymous 10]

I feel like the union employees are getting more at my expense. (OK...Bad Partner)

If you feel that way join your own union. They negociate contracts that ups corporate likes to violate daily just like they walk all over you. Then maybe we could both adhere to the contracts we would have and do the moral and right thing.

 

[upssalesguy]

i don't feel like we are losing a quarter of MIP. It's not like the MIP factor would be higher or lower if they include those three months. If this year we got 2.4 and next year we got the equivalent of 2.4 (or whatever the factor will be), did we really lose anything?

 

[tieguy]

Tie ,remember this?
08-08-2002 11:37 PM #8
tieguy
Anonymous
To me the jury is still out on OPL. The investment cost me nothing. With dividends already received the Return on investment is somewhere around infinity.

I dont remember it but I agree with it.

 

[tieguy]

i don't feel like we are losing a quarter of MIP. It's not like the MIP factor would be higher or lower if they include those three months. If this year we got 2.4 and next year we got the equivalent of 2.4 (or whatever the factor will be), did we really lose anything?

three months unless they tack on an extra 25 percent to account for the lost quarter.

 

[tieguy]

I feel like the union employees are getting more at my expense. (OK...Bad Partner)

I'm not ready to adopt your perspective. Changes were made that benifit the company and may end up being a wash for us.

 

[brownmonster]

A few years back we lost 5.8 seconds of delivery credit per box. Cost me 5 grand in bonus that first year. Now my route got pushed from the country into the city. More stops, less driving. Less OT. I'll be down another 5k from 2 years ago. Although it doesn't look like it from a contract point of view we lose too. I feel your pain.

 

[UpstateNYUPSer(Ret)]

A few years back we lost 5.8 seconds of delivery credit per box. Cost me 5 grand in bonus that first year. Now my route got pushed from the country into the city. More stops, less driving. Less OT. I'll be down another 5k from 2 years ago. Although it doesn't look like it from a contract point of view we lose too. I feel your pain.

Personally I budget based on a 40 hour work week--anything beyond that is gravy. I am not saying that this is the case with you but too many UPSers rely on the overtime to make ends meet.

 

[cachsux]

I feel like the union employees are getting more at my expense. (OK...Bad Partner)

Everyone cuts their own deal. You made your choices live with them.

 

[pretzel_man]

As far as I can tell, all the things mentioned below have nothing to do with this change.

If you want to complain about previous changes, maybe a new thread is needed.

I am still unaware of anything negative about this current change. That is what this thread is about.

If people want to speculate that this is a move to eventually get rid of 1/2 month checks, go ahead. That has not happened yet. Not sure the point of complaining about something that hasn't happened.

Pretzel, if you really believe that, I've got a few bridges to sell you.
First... Let's get to the glaring issue. Although UPS said we'd get a partial MIP in Dec 2011 it's basically from the 2012 payment. We are losing the 4th qtr 2011 in MIP. Gone. Also they are spreading the 2011 MIP over two calendar years, partial payment in 2011 and the rest of the yearly MIP in 2012. So UPS shows less cost for mgmt for two years with this one change alone.

Let's see what else we can all remember we've lost over the years.
Here's from what I can remember.

1. Medical benefits. Used to have no medical costs. I pay out over 500/month between medical coverage and flex to pay for my family's medical cost. Usually, I still have out of pocket beyond this. That's 6,000 per year I make less then before.
2. MIP used to give us an interest free tax free loan on the amount of the social security tax from the MIP benefits. UPS loaned us back the 6.2% of social security tax and took it back over 10 months as an interest free loan.
3. Holiday turkey - not much money. but a nice tradition gone.
4. Vacations.. My first year at UPS, I had no vacation, but I could borrow one from the next year. All vacations taken in a year were earned the year prior. Magically one year they changed it and vacations are earned in the year they were taken. Now the liability they took off their books benefited UPS, but we didn't get a payout from the vacation weeks we were owed. Granted this only negative affects us if we quit. If we retire we can still get the last year of vacations. (how long will it be before that is gone?)
5. Mystery MIP numbers. Does anyone truly believe that if we had used the old formula of 15% of the profits vs the mgmt payroll we wouldn't have had a much higher MIP these last few years?
6. MIP -now partially given in RSU. If you stay with UPS, not too big a deal. But for anyone who leaves, they lose a lot of stock in form of RSU's that disappear.
7. One year of no raises. This was something that still affects us since our base is always lower then it otherwise should be.
8. Expense acct. Used to be all miles were paid at the IRS max level which now is $.50/mile. I forgot when, but now after 1,000 miles, the reimbursement is $.19 per mile.
9. G.O. closures - Corporate relocated certain high level mgrs (district mgrs) who in effect stayed in the new district structure. But all other people now just has a new work location and has to pay for the extra long commute themselves. Or people moved themselves to keep their job.
10. The list can go on.. But I just get more upset as I write these down.

Almost all the time they do this, it is
A. To better align UPS with the competition.
B. No cost changes to employees\UPS. Just redefining how we do things (Pretzel).

In fact, it's to reduce cost on the back of mgmt. They can get away with it due to poor economy. But I see a big exodus when the economy rebounds and no reason for a new supv to want to stay. I see getting new supervisors will be more and more difficult.

Short term. I think for UPS this is good for them. In 10 years or so. I think they will wonder why the mgmt talent has gone downhill.

Nice recap!

Don't forget the reductions in pension and the reinstatement of the 401k match at .5 percent less and the realignment of pay raises that led to prorated raises that last a lifetime. Also, keep in mind that you have been given the responsibility of the next level through reductions, but you still get the pay of the lower level.

More to come, I'm sure. The first year is the "sell" year where they make it look good.

 

[Anonymous 10]

Everyone cuts their own deal. You made your choices live with them.

+1,000,000

 

[tieguy]

As far as I can tell, all the things mentioned below have nothing to do with this change.

If you want to complain about previous changes, maybe a new thread is needed.

I am still unaware of anything negative about this current change. That is what this thread is about.

If people want to speculate that this is a move to eventually get rid of 1/2 month checks, go ahead. That has not happened yet. Not sure the point of complaining about something that hasn't happened.

the company is grateful for you support. I personally think you're much too bright to miss the point that future promotions will miss out on the half month bonus.

Hi joe welcome to management. Your starting salary is x amount of dollars. As recognition for the extra time and effort you will put in at peak we built in an extra 3 percent into your check.

How long do you honestly think future managers will try to sell that song and dance?

I dont necessarily agree with the woe is me management is getting screwed opinion of the poster you responded to but I did think his point was relevant to this thread.

 

[beentheredonethat]

the company is grateful for you support. I personally think you're much too bright to miss the point that future promotions will miss out on the half month bonus.

Hi joe welcome to management. Your starting salary is x amount of dollars. As recognition for the extra time and effort you will put in at peak we built in an extra 3 percent into your check.

How long do you honestly think future managers will try to sell that song and dance?

I dont necessarily agree with the woe is me management is getting screwed opinion of the poster you responded to but I did think his point was relevant to this thread.

I don't think it's an entirely Woe is me attitude. My point is that there's been a lot of changes to management compensation. Mostly for the worse. To a large extent the negatives are impacting the new mgmt (and future) mgmt more then the current mgmt who plan on staying til they retire.
As other people have said on other threads, the feeling of partnership is pretty much dead for mgrs and supervisors. New supervisors don't have the same dedication and work the same hours as those did in the past. But truthfully I can't blame them. UPS keeps touting that this will align us with other companies. You can't expect to get superior results with average compensation. I'm concerned as a stockholder that in 10 -15 years down the line, when a lot of longer term UPS mgmt retires we won't have a great mgmt team to take over the company. Since the smart move for younger mgmt is to leave since all you'll get is industry average and be expected to put in more then industry average hours.


As for how the changes will affect us. First for 2011 payout, the company will only pay a portion of the 2011 MIP that year, and in 2012 they will pay the rest of it. So for those two years, they will pay out one net MIP amount (just spread over two payments).
Also, I did payroll in the past, we always looked at raise time to see what the mgmt person was it in regards to their monthly pay for midpoint and max pay. By giving the half month as part of the monthly pay. Unless they change the guidelines for midpoints and max monthly pay. It will negatively affect peoples future raises too.

I've been around over 20 years, and it just seems that mgmt is getting the short end over and over. For me, I still realize I make a decent salary. (Nothing outstanding, but the pension, vacations etc) make it so staying for another 10 years makes sense for me. It doesn't make sense to lose that and start again somewhere else.

 

[fxdwg]

So are you guys bummed or not? It seems like you're losing more every year.

Just asking.

 

[beentheredonethat]

So are you guys bummed or not? It seems like you're losing more every year.

Just asking.

This latest change isn't too big a deal. I see it more of a negative for newer Supervisors. I also see UPS having a tougher go of it as the economy rebounds and some bright young supervisors realize that UPS isn't for them and we lose some great talent. There's no doubt that UPS expects a lot from us, weather you are a driver, a mechanic, or in mgmt.
Overall for our drivers, mechanics etc UPS has the highest pay for our FT people compared to others in our industry. The same isn't true for mgmt. (Although it used to be). I'm concerned that in 10-20 years down the line, we will have problem with our mgmt team running the company.