What’s good for the goose…
Late yesterday, Ryder Systems (R) put out this press release which said it would switch from a pension plan to a 401-K plan for about 9,400 workers starting next January. Snore city, right? After all, lots of companies have made the move from defined pensions to the less expensive (and more choice-oriented) 401-K plans. In this Bloomberg story, Ryder said the change would have no short-term impact on the company’s financials.
But it was the 8-K that had this much more interesting disclosure:
The new severance benefits for all officers, including our CEO and current Executive Leadership Team, will be similar to those provided under the existing Agreements except as follows: (i) shorter severance periods and a change in the bonus calculation in both a change of control and non-change of control situation, (ii) elimination of certain perquisites, (iii) use of a modified tax gross up in a change of control situation (rather than the full tax gross up which is currently provided), (iv) a change in the definitions of ‘change of control’_, ’cause’_ and ‘good reason,’_ and (v) inclusion of a one year non-solicitation provision under all termination events regardless of whether severance benefits are paid.
That item didn’t make it into any of the news reports on the switch, perhaps because it was strangely missing from the press release. The change takes effect next January, which is the same time the company plans to switch to the 401-K plan for those 9,400 workers. What it shows is that the company isn’t just making a change that impacts rank-and-file employees, but the executive suite too. And that deserves a rare footnoted.org gold star, even if the folks at Ryder weren’t smart enough to tout that in the press release.
And now a shameless plug: on Tuesday I did an interview with Lindsay Campbell of Wallstrip that posted today. While the folks at CNBC do a better job on the makeup, the show was a lot of fun. Check it out here.