An analysis of government data by the Journal shows that on average, base salaries climbed to $437,896 a year as a result of Feinberg’s review, compared with $383,409 previously – a 14% increase. Of the 136 employees under Feinberg’s review, 89 saw their base salaries increase.
At Citigroup, which is 34%-owned by the U.S. government, Feinberg agreed to more than double salaries for 13 of the 21 employees, according to the Journal’s analysis. Treasury Department officials confirmed the accuracy of the Journal’s methodology for calculating the number of employees whose base salaries rose, the news report said.
Officials with some of the companies confirm they urged Feinberg to boost base salaries, complaining that his proposed restrictions would deprive their employees of needed cash. Others said they wanted higher base salaries to prevent key employees from leaving.
Feinberg oversees seven firms that accepted bailout packages – American International Group Inc., Citigroup Inc., Bank of America Corp., General Motors Corp., GMAC Financial Services, Chrysler Group and Chrysler Financial – and was charged with tying more compensation at the companies to long-term performance and cutting pay deemed “excessive.” Government officials say Feinberg met that objective, according to the news report.
The Treasury said last week it cut “average cash compensation” for the companies under Feinberg’s control by more than 90% compared with 2008. Average cash compensation includes base salaries, a share of company profits, commissions, retention payments, and other guaranteed cash payouts, but not stock grants.
Feinberg said he was imposing a $500,000 ceiling on base salaries and wrote in a summary document he had rejected “cash guarantees that separate pay from performance.”