In a regulatory filing, Washington Mutual’s Board of Directors decided that executive bonuses for 2008 would exclude housing-related loan losses and expenses tied to foreclosures.
For example, this will allow the CEO’s 2008 bonus to now equal — and achieve — 365% of his base salary.
The reasoning for the formula according to the Securities and Exchange Commission filing was in response to:
the challenging business environment and the need to evaluate performance across a wide range of factors.
Excluding the issues with the home loan and foreclosure problems in bonus calculations should be a great boon for employees too. Much of the bonus, as in most companies, is dependent upon company performance and the home loan business really hurt the hard working employees.
Excluding these non-performing assets from the bonus calculations for employees like they are doing for the executives should really help.
They are excluding the home loan issues from the employee bonus calculation just like for the executives, aren’t they?