Once again Target Canada has found itself trending on social media for the wrong reasons— this time for the size of its ex-CEO’s severance package.
With the chain closing 133 stores and laying off about 17,600 employees in Canada, Canadians haven’t found many positive thoughts to share about the company.
This past week one of the most popular topics on social media websites was the severance package offered to Target ex-CEO Gregg Steinhafel, who stepped down last spring.
Social media users demonstrated their outrage at the amount of Steinhafel’s departure package, which Fortune Magazine estimated at $61 million, while USA Today estimated it at $55 million. Regardless of the exact amount, it is clear that it is close to the $70 million total amount Target made available for designated “employee trust” funds, offered to its laid off Canadian employees.
It is reported that Steinhafel stepped down for two reasons, one being a credit card breac, when 40 million American credit card numbers were stolen by malicious online software from Target’s security and payments system and the other being the ex-CEO’S large responsibility for the failed expansion of the Target brand in Canada.
“If I fail at my job, I don’t get a large exit package. I get a reference and a boot in the ass.” Reddit user ronintetsuro stated on one of the topic’s chat pages. “What gives?”
“It’s just wrong. His failure, their jobs lost. Yet he wins, and they lose,” shared S. Chandra Herbert via Twitter.
According to Fortune Magazine, Steinhafel’s specific severance pay was $15.9 million. Yet due to add-on stock options, pension and deferred compensation, the package value reaches $61 million.
According to economists, the discrepancy of compensation between company top executives and rank-and-file employees is growing. According to PayScale.com, the average U.S. CEO makes 354 times as much as the average worker, while in Canada the average CEO makes 206 times as much.
Due to contract clauses, Target Canada workers are not allowed to voice their opinion on the company’s matters and decisions for the next couple of months.
“At the moment, employees are not allowed to talk about Target matters until the store has completed its withdrawal from Canada. It’s in our contracts,” a Target employee using the Twitter username Lilith Aversa tweeted.
For Canadian Target employees to be eligible for severance pay, they must remain working under their contracts for the next 16 weeks, until the company has completed its withdrawal from Canadian soil. If workers choose to leave before that date, they will no longer be eligible to receive severance payment.