Grade 20 Bonus

Discussion in 'UPS Partners' started by UPSBOT, Mar 27, 2007.


    UPSBOT When UPS Was Fun

    Since we are now a public company is there somewhere I can see what each person grade 20 and higher received in bonuses in 2006. :confused:1
  2. MR_Vengeance

    MR_Vengeance United Parcel Survivor

    see the sweat dripping down your forehead? that's their bonus........
  3. The payout of the Long-Term Incentive Performance Award Program (LTIP) (or as you call it, the "Grade 20 Bonus)) has been detailed in the UPS Proxy statement (SEC form 14A) filed with the SEC on March 19th . . . on page 24 it states:
    "At their meeting on February 7, 2007, the Compensation Committee determined that 85 percent of the target award for the 2006 tranche was earned."

    "During 2006, a total of 623 employees received a target grant of approximately 1.18 million RSUs."
    Do the math here . . .With each RSU convertable to one Class A share at the end of three years, that represents on average 1,894 RSUs / Class A shares for each grade 20 .
    Convert that to cash at a $70.00 price per share, and that is an average value of $132,584 for each of the 623 participants ~ or $82.6 million in total!! And that was at 85% to plan!
  4. Interesting....As an old time UPSer, I always thought there were 'NO Gray Areas'...

    You either made the plan or you didn't. In operations 85% effective is out of business. If you were the manager you'd be transferred to HR, or given a corporate special assignment(no one gets fired).

    Go UPS!
  5. LOL Not exactly, PEACOCK71, how much have things changed. Gray has become the new color of UPS management under the current leadership . . . Look at MIP for example.

    This is the current description of the MIP plan, in a letter to current UPS Management:
    How is the bonus award determined?
    The redesigned Managers Incentive Plan (MIP) is a bonus plan based on target awards for eligible plan participants. The targets are expressed as multiples of monthly salary similar to prior MIP factors. The aggregate award will be based on the actual award multiples as determined by the salary committee multiplied by the aggregate monthly salaries by award level (e.g. one-unit and two-unit). In the past, MIP was a “profit sharing plan” and the aggregate award was determined based on a percentage of the company’s pre-tax profit.

    How were two and four-month salary determined for payout?
    The target awards were determined based on historical MIP factors. For the past 10 years the average MIP award has been 2.11 months of salary for a one-unit participant. Two months is the one-unit target under the revised program.

    So what were the elements and results for 2006 you ask?
    Setting MIP goals and targets

    The Compensation Committee, considering recommendations from the CEO and CFO, sets the company performance objectives and target amounts payable.

    MIP is designed to incorporate performance criteria which support our annual operating plan and business strategy. For the 2006 MIP fiscal year, goals were established for the following six business elements:

    1. Growth in consolidated package volume
    2. Growth in consolidated revenue
    3. Growth in consolidated, as adjusted, net income
    4. Non-operating cost as a percent of revenue
    5. Package flow technology implementation
    6. Successful integration of acquisitions

    Executives are also evaluated on personal criteria including leadership, managerial skills and talent, business knowledge and execution of UPS’s overall business strategy, and adherence to company values.

    The goals for the six business elements were based on our confidential business plans established at the beginning of the 2006 MIP fiscal year. These goals were consistent with other publicly disclosed financial targets for 2006, and were designed to be challenging yet achievable. After evaluating our performance against these goals, the Compensation Committee determined that the 2006 MIP award to be paid to all recommended managers, including the NEOs, would be reduced from the targeted award amount by 20 percent due to below plan performance with respect to certain of these business elements.
    Objective measurement is just not possible with the goals listed here. One almost wonders if ambiguity was not a goal of the new MIP plan; after all, they needed a way to be "cost neutral" and pay the $86 million cost for the LTIP bonus.

    "What can Gray do for you" just does not have a ring to it, does it?
  6. wkmac

    wkmac Well-Known Member


    UPS is now so far from the old United Parcel Service they changed the name just to make most obvious. If that's not enough measure the distance from one side of our solar system to the other and then you'll have a good idea of what I'm talking about.

    Seriously, be glad you are gone!



    What do you say to your supervisor when you gave him 9.59 shares in October 2006 as the first 20% of the 2005 deferred MIP? Do you say "hold on to this stock and in 297 years at the 1% growth rate we have experienced the last 7 years you will be a millionaire?"

    It is a shame what upper management and greed have done to our company. Withhold authority for all of the BOD and maybe they will get the message. If some large mutual fund company would put some pressure on UPS to make all A & B shares vote equally - one vote each - our upper management wouldn't last a week.
  8. Dfigtree

    Dfigtree New Member

    Executives are also evaluated on personal criteria including leadership, managerial skills and talent, business knowledge and execution of UPS’s overall business strategy, and adherence to company values.

    If the executives fail the evaluation, they get the LTIP?
  9. potok

    potok Guest

    You tell him that if he isn’t satisfied with his 9.59 shares you’ll make a note and he won’t have to be worried about being recommended for MIP again.

    You also let him know (just in case he really isn't complaining) that if he wants more MIP and more money he can move upward and onward and accept more responsibility with the compensation (and headaches) that comes with it.

    Don't plan to occupy the bottom of the totem pole and get the Cadillac treatment, IOW.

    You're not clear on How Things Work, are you?

    The salary committee will determine what they need to offer to attract, develop, and retain the people they need.

    Not *you,* not “some large mutual fund company” - and I highly suspect – not anyone surfing on a message board.

    Probably should concentrate more on getting plenty of rest, avoiding binge drinking, cutting down on saturated fats, getting to work on time, learning something and applying it to your job function to be more productive… you know – things you have some control over.

    You'll be happier. I promise.
  10. UPSBOT

    UPSBOT When UPS Was Fun

    Where does the Grade 20 pay scale start at?
    I was told it started at Divison Manager.
  11. Channahon

    Channahon New Member

    Region Department Heads are grade 20
  12. The ironic thing about this comment is that it violates EVERYTHING that the spirit of Partnership represents. The Partnership has been the foundation of UPS, and the reason for its 99 years of success.

    "I have a voice in determining the future course of our Company. The management climate in our company is such that I can and should speak out on matters that pertain to our common welfare. I know that I will be heard; I know that my comments will be heard with respect."

    "Being a partner means "Sharing in All Things". I share in the elation of our successes and I share grave concern when we fail."
  13. Sensible One

    Sensible One Guest

    You used to be able to say that and it would be perceived as a viable threat (even though it probably really wasn't). Now you can still say it, but he'll know that what you're saying doesn't have any teeth and then he'll tell the rest of us about it. We'll all have a good laugh over it and discuss how you need to retire because you're trying to manage this new environment the way you used to manage in the old days. This is the new UPS - the stock doesn't go up, people say no to relocating and nothing happens, and the threats no longer work.
  14. Potok, it sounds like it may be you that doesn't understand how things work.;) You see, these days opportunities for advancement, especially for young supervisors and managers, are extremely limited. Centers, Districts and Regions are being consolidated. Staff functions are being forced to run leaner. Back in the old days it sounds like you're pining for there were more advancement opportunities than there were qualified people to fill them. I imagine this helped you out somewhere along the line. ;). But now, the best of the young people see uncompetitive salaries, a large part of their compensation being tied to ambiguous goals that they don't have control over, they see old battleaxe A-holes blocking the spots they could be moving up into, and they hit the road. The ones who hang around will be the bottom of the barrel who don't have anything else going for them. Things may come to those who wait, but only things left behind by those who hustle. - Abraham Lincoln