TORONTO – A May 2014 article from money magazine Fortune is getting a lot of attention Thursday after a Reddit post used the story to highlight some glaring income inequality — Target’s ex-chief has reportedly been given more money to leave the U.S. retailer than Target has set aside for all 17,600 Canadian staff who are being laid off as the company exits Canada.
Target said it will make “cash contributions of C$70 million (approximately US$59 million) into an Employee Trust” for its approximately 17,600 staff in a release last week. The company said it was to “ensure fair treatment of Target Canada employees.”
The Fortune article clarified Gregg Steinhafel’s “golden handshake” was technically $15.9 million, but suggested he’d get $33.1 million more in “non-qualified deferred compensation, a sort of super-sized 401(k), and $1.2 million from a pension that he didn’t have to pay back.”
“Also not included in the headline figure endorsed by Target are Steinhafel’s stock options that he can continue to exercise over the next five years…even at today’s depressed stock price these are worth $10.8 million,” wrote Paul Hodgson in the May 21, 2014 article.
“Thus Gregg Steinhafel’s full walk-away package is (US)$61 million.”
Of course, there are conflicting estimates of his actual take-away, with Bloomberg suggesting $47 million in a Jan. 5, 2015 article addressing the gap in highest- and lowest-paid employees in the American workplace. Still, it’s a number Canada’s laid-off Target employees can only imagine.
READ MORE: Here’s why Target failed in Canada
And such a gap isn’t specific to Target: Canada’s top-paid CEOs saw their compensation climb at double the rate of the average Canadian between the depths of the recession and 2013, according to an analysis released Jan. 2 by the left-leaning Canadian Centre for Policy Alternatives. It suggested Canada’s 100 highest-paid chief executive officers pulled down an average of $9.2 million in 2013, about 25 per cent more than the $7.35 million they amassed in 2008. That’s compared to the average 2013 Canadian income at $47,358, about 12 per cent more than the 2008 level.
With a file from The Canadian Press