Sears recently filed for bankruptcy and has plans to close even more stores. Amid bankruptcy plans, Sears is seeking court approval to pay their executives as much as $19 million in bonuses. If Sears goes out of business, the top three executives could get about $1 million each. If they remain in the business, they could get around $500,000. The bonuses would only be paid if Sears reaches their cash-flow targets.
Sears also asked courts for another bonus that would be only available to execs who stay with Sears during the reorganization process. This is so top employees stick it out with the company instead of leaving when things get rough. The hearing for the bonuses is set for December 20, right before Christmas. The only exception is that Eddie Lampert, the chairman and primary shareholder of Sears, will not receive a bonus in the filling, even if bonuses are approved.
How Sears Is Treating Store Employees
Unfortunately, as Sears tries to cling to their executives, they are closing many Sears locations and laying off employees of the stores with no severance packages. Employees are upset that they were promised severance packages, then told they couldn’t receive them because of the bankruptcy and are now learning about these bonuses.
As of right now, Sears bankruptcy plan is to stay in business and sell itself. They filed for Chapter 11 bankruptcy last month. With the bankruptcy, Sears secured a $350 million bankruptcy loan from Great American Capital Partners. They are also considering offers from companies to liquidate the business. They plan to close about 180 of their remaining 500 stores. Other stores like Toys “R” Us have been in the same predicament as Sears is right now. David’s Bridal also recently filed for a Chapter 11 bankruptcy.
Sears has been in business for over 125 years. They currently employ around 68,000 people. What a shame that such a long-lasting company is going out of business. Even worse, that they are trying to give executives big bonuses while opting out of severance packages for loyal employees at their stores.
What do you think about Sears closing? What memories do you have of shopping at Sears over the years? Will you continue to shop there or have you already stopped to shop at other retailers?
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