Executives Do Receive a Lot of Extra Goodies
QUESTION: I live in a blue-collar neighborhood and lately I have heard a lot of people grumbling about all the perks they think their bosses receive. Do officials really receive so many more things from their company than the workers do? Or is it that because their salary levels are higher they get more of the same benefits the lower-level workers do?--B. O.
ANSWER: Certainly the level of benefits received by executives is higher than that of others in the work force. But it is also true that executives at many companies receive benefits that lower-level employees are never offered.
These perks--shorthand for perquisites--are extra benefits used to lure and keep the men and women at the top of corporations.
The menu of perks differs from corporation to corporation. But, according to Hewitt Associates, a Chicago-area consulting firm specializing in employee benefits and compensation, U.S. companies routinely offer seven or more perks to their executives.
By far the most popular executive perk, Hewitt found, is a regular medical check-up--company paid, of course. In fact, of the hundreds of companies Hewitt regularly surveys, fully 94% pay for their executives’ medical examinations.
Next most popular as executive perks are memberships in country clubs, athletic clubs and the like, followed by company cars, free financial counseling and first-class plane travel for the executives and their spouses.
Q: I find it incredibly rude for people to speak in acronyms and I seem to hear more of it all the time. The other day, I was at a business lunch and was half-heartedly listening to an animated discussion about labor negotiations when the participants started talking about GELs and I got so lost and so frustrated that I just walked away. To make matters worse, I’ve been trying to find out ever since what these stupid GEL things are and I can’t find anyone who knows. Do you?--L. R.
A: GEL is short for guaranteed employment level and, in some labor-management bargaining talks, it is taking the place of higher wages as the union’s top priority.
Workers who get a so-called GEL agreement are guaranteed a job for the life of the labor contract. In other words, no matter how bad the troubles of the company or the economy, the workers are promised in advance that they won’t be laid off. They may have to take a pay cut, work a reduced-hour shift, share jobs or agree to various other concessions, but there will be no layoffs.
So far, this union-devised bargaining chip has been particularly popular in America’s Rust Belt. Workers at the Case IH agricultural equipment manufacturing company recently won GEL security, and auto workers in Detroit are expected to push for the no-layoff guarantee in coming negotiations.
Q: Do you know whether Switzerland is still the favorite hide-out for people who have some reason to be secretive about their money? I’m not trying to hide anything myself. It’s just something I’ve wondered about as I read about some of these Wall Street crooks who had money hidden in the Bahamas.--E. W.
A: For the very reason that people open bank accounts in such places as Switzerland--privacy--it is difficult to obtain such information. But based on banking industry estimates about bank deposits in various countries, the Cayman Islands--rather than Switzerland--provide the most appealing haven for secret bank accounts, with deposits at all banks there exceeding $200 billion last year. Tied for second, with $160 billion in deposits each, were Switzerland and Luxembourg.
U.S. Justice Department officials speculate that Switzerland’s 35% tax on bank interest earnings as well as that country’s growing interest in doing business in the United States are responsible for the shift.
In the example of imprisoned insider-trader Dennis B. Levine, U.S. Justice Department officials were able to crack the case after Swiss officials eager to gain better access to U.S. markets finally agreed to cooperate with the criminal investigation into Levine’s activities. He had hidden money at the Bahamian branch of a Swiss bank.
