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« Tiger's Indefinite Leave Clippings, Vol. 9 | Main | "What’s striking instead is the exceptional, Enron-sized gap between this golfer’s public image as a paragon of businesslike discipline and focus and the maniacally reckless life we now know he led." »
Sunday
Dec202009

"Will Finchem, co-chief operating officers Charlie Zink and Ed Moorhouse and executive vice presidents David Pillsbury, Tom Wade and Ron Price take a cut in pay?"

One lingering question from the Tiger saga involves media coverage and whether having been caught off guard by Tiger's private life would lead to tougher golf media coverage. I don't know about you, but I'd say this Alex Miceli Golfweek.com piece looks like the first sign of a more, uh, discerning golf media.

He starts off in your basic recap of Tim Finchem's panned teleconference by noting some particulars in the 2010 schedule and then the hatchet comes out.

The commissioner also neglected to mention recent jobs losses at the Tour.

The changes included layoffs in multiple departments, notably Championship Management, Shotlink and Golf Course Development and Construction.

A tournament director was let go, and at least six Shotlink employees were eliminated.

The Shotlink crew got the news immediately after completing its last tournament of the year, a source told Golfweek.

According to a Tour official, three of the Shotlink crew were made redundant. The other three positions were being outsourced and may be hired by the contractor. The same official said these and the other personal moves were not layoffs.

Miceli goes on to detail how the 401k program has been frozen for all staff and then asks the obvious question that's been burning since Jon Show revealed 2008 PGA Tour executive salaries and scheduled future bonuses. You're cutting the Shotlink folks taking home chicken feed, so are the executives doing their part?

One question that wasn’t addressed: Will Finchem, co-chief operating officers Charlie Zink and Ed Moorhouse and executive vice presidents David Pillsbury, Tom Wade and Ron Price take a cut in pay? Each made more than $1 million in compensation in 2008, according to Tour financial filings.

And to remember, as Show wrote:

In the 2008 filing, the tour also outlines a long-term incentive bonus plan payable to high-ranking employees in 2009 and 2010 unless the individual terminates his or her employment. Finchem’s bonus is scheduled to be nearly $1.9 million in 2009 and 2010, followed by Zink and Moorhouse at $534,127 each.

I know, I know, those bonuses will be hard earned no matter the job performance and these men have second and third homes in need of twin Sub-Z's. But those bonuses sure could pay for a lot of jobs that appear headed for outsourcing.

I put the question out once and will try again, someone please explain to me the point of a performance bonus that is pre-determined and scheduled?

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Reader Comments (11)

They've fallen into that old tribal trap. More chiefs than indians.
12.20.2009 | Unregistered CommenterRunning Water
Amazing! Oh, if we could only have a simple, straightforward response to each point raised. And how likely is that?

It's surreal that the same double-speak, the same dissembling and the same complete lack of candor employed by Mr. Finchem and crew echo the responses we've had to endure recently from TW, Inc., IMG, Inc., Nike, Inc. and others in response to honest and deserved inquiry (notably, to their public derision and, "OMG what freakin' idiots".)

And now another PR-inspired juggernaut likely will be given a chance to stanch the flow of big money, reeling in big money, with a new spin. Another spin without any additional integrity, but never admit it, while the simple truth with candor and sincerity, good will and humility just might engender a bit of understanding and appreciation--that is, after the initial shock wears off.

Too bad we can't ask Elin to clean out, clear out, Mr. Finchem's house, too.
12.20.2009 | Unregistered CommenterChannelling Keith
For the tax people on here how does a guaranteed bonus work with 409A regulations? Would Tim/Charlie/Ed already have pre-paid the taxes per 409A rules. If there is no substantial risk of forefiture aren't taxes due when the bonus vests and not when it is paid?
12.20.2009 | Unregistered CommenterPABOY
I'm really surprised this issue of pay at the highest levels of the Tour hasn't become a bigger story in the press, and also with the politicians given the non-profit status that the tour enjoys. And there are still a select few events that remain for-profit which annually put in excess of 7-figures directly into the pockets of the owner.
12.20.2009 | Unregistered CommenterFarmingdale
Geoff, get with the program! That $3,000,000 in bonuses for Li'l Timmy, Zink, and Moorhouse could indeed pay salaries and benefits for 20-30 regular employees. But we don't do that sort of thing in this country. The three amigos have earned their scratch and nothing is going to get in the way. Contracts and all that, you know. Instead of having the work done by real employees there will be money to hire a contractor who then re-hires the laid off staffers, at a lower salary and no benefits. Works great all the time! Blackwater (excuse me; that's Xe) anyone?
although they call them performance bonuses, they are structured more like retention bonuses in that you must be present to claim them. not sure whether that qualiifies as a substantial risk of forfeiture under 409A, but i'd bet everything i have that finchem and the boys used some high-priced help to make sure they jumped through all the required tax law hoops.
12.21.2009 | Unregistered Commenterthusgone
The purpose of a guaranteed bonus is to motivate an employee to remain in his or her employment. It is not a reward for meeting predetermined goals. It is separate question as to whether the employee was worth the remuneration, including salary, bonus and benefits paid and payable to him or her in the first place.
12.21.2009 | Unregistered Commenterdouboug
douboug,
Thanks, makes sense.

But that raises another question, where on earth would the guys in question go and get paid more than they are making at the PGA Tour?
12.21.2009 | Registered CommenterGeoff
geoff: retention bonuses are often used as a backhand way of increasing overall compensation package without linking the money to any measurable performance goals. it often has no relationship at all to the executive's actual professional employment options, and in some industries it is a standard part of an executive's compensation..

the verbiage goes something like, "because so-and-so is a valuable employee whose contribution to the enterprise is essential, and in recognition that so-and-so's skills are in high demand, in order to ensure the continued retention of so-and-so's skills, the organization will pay a bonus of xx dollars on xx date if so-and-so is still employed by the organization."
12.21.2009 | Unregistered Commenterthusgone
When Commissioner (Finchem & Graft Cronies) file fraudulent 990 tax returns it doesn't take a rocket scientist to understand why someone (Finchem) would build himself a 25,000 square foot home......
12.22.2009 | Unregistered CommenterHello!
Just as you won't see them taking $$$ away from themselves or the pros, but they won't donate to charity as much and layoff the people that ACTUALLY make the PGA Tour work. The whole thing is pathetic. I'm sure none of the pro's would notice (or care) if they were playing for $750,000 or $1,000,000 for 1st place, so long as the local charities didn't see a 25% drop in donations.
12.22.2009 | Unregistered CommenterJustin

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