Verizon shareholder activists are hoping a proposal to limit executive compensation will get approval today at Verizon’s annual shareholders meeting in Albuquerque, New Mexico. The proposal, which is opposed by Verizon’s Board of Directors, comes from a Westchester retiree. The meeting comes as striking Verizon union workers are calling May 5 a National Day of Action.
The Association of BellTel Retirees, a non-profit retiree advocacy group, is fighting for pension protections and against excessive executive compensation at Verizon. Westchester County resident and Chairman of BellTel Jack Cohen’s proposal calls for allowing shareholders to weigh in on the telecom chairman’s and other senior executives’ severance packages.
The chairman can get, instead of three times, he now can get the equivalent of over seven times his annual salary and short-term bonus,” says Cohen. “We’re not saying that does not become deserving. Everyone wants to reward good practices and corporate governance but all we’re saying is we think it’s incumbent upon the shareholders to make that decision to accept that kind of executive compensation.”
A Verizon spokesman declined comment on the proposal, citing Securities and Exchange Commission regulations that would view comment as a proxy solicitation. However, in proxy statement filings with the SEC, Verizon writes that Chairman Lowell McAdam does not have a golden parachute, has no employment agreement with Verizon and is not entitled to any cash separation payment if his employment is terminated. Again, here’s Cohen on his proposal.
”We don’t think there’s anything unreasonable in that,” says Cohen. “Last year Verizon fought it like crazy.”
Fought it by a 2-1 margin and defeated it in the two years before that. In the proxy statement, Verizon gives reasons for voting down the proposal, saying the proposal would expand the current policy to include the estimated value of outstanding equity awards for purposes of the 2.99 severance benefit calculation, which it contends is not in the best interest of shareholders. Cohen argues a golden parachute could net the Verizon chairman $40 million if he is fired or the company is purchased.
Cohen says about one-half of his 134,000-member association consists of union members and he is sympathetic to the Verizon workers on the picket line who have been without a contract since August.
“It seems a major contrast that Verizon is fighting tooth and nail against our proxy to try to control the millions of dollars they’re getting in these executive compensations,” Cohen says. “At the same time, we’ve got people on the picket line trying to fight for their jobs so they can stay alive.”
May 5 is a National Day of Action for the striking Communications Workers of America and International Brotherhood of Electrical Workers. Picketing includes sites throughout the Hudson Valley. After more than 10 months of negotiating, Verizon at the end of April presented union leaders with an updated proposal for about 36,000 wireline employees in the company’s Northeast and Mid-Atlantic regions. Frank Fauci, Jr. is president of CWA Local 1120 in Poughkeepsie and is participating in the National Day of Action.
“We want to bring awareness to the public that corporate greed is everywhere and Verizon is basically the poster child for that in this country,” says Fauci, Jr.
Rich Young is a Verizon spokesman.
“Verizon has put an excellent offer on the table that includes a 7.5 percent wage increase, continued job security protection and outstanding retirement and healthcare benefits,” says Young. “It’s time for union leaders to get serious about bargaining and put the needs of our employees first rather than their misguided personal agendas.”
Fauci, Jr. says he’s not interested in a wage increase at the bargaining table.
“It’s not about money with us and we’ve let them know that at the table. We’ll certainly welcome any increase to wages but that’s not our concern. We haven’t talked about that at the table yet because they haven’t addressed our concerns,” says Fauci, Jr. “That’s just their offer in exchange for all of the things that they want to do that’ll hurt us much more.”
“Well, our employees need to start asking union leaders why they continue to stage circus-like street rallies rather than engage in meaningful negotiations,” says Young. “Each day union leaders stage these pointless rallies is another day lost at the bargaining table and another day of lost wages for our employees.”
Again, Fauci, Jr.
“The main thing that really bothers us, though, is the contracting out of work and call-sharing jobs being shifted overseas,” says Fauci, Jr. “I don’t think anybody in America wants that so we’re just trying to raise the awareness for all of the public and the nation on what Verizon is trying to do.”
The strike began in April.