JCPenney Paid Top Execs Huge Bonuses Before Firing Workers

JCPenney has been a sinking ship for years, even when the economy was in great shape. Paying bonuses to those execs may be bad optics, but aside from maybe firing a few less, probably has no bearing on the survival of the company. The company has 4.5B in debt (the bonuses aren't even 0.2% of that total). In the last month they missed $30M in payments (the $17M payment was made eventually) on that debt; these bonuses are only $7.5M. In other words, if they paid no bonuses whatsoever, it has little to no effect on JCPenney's solvency. Eventually, all of the workers will lose their job.

&quot;...necessary to retain the management team and keep them motivated...&quot;<p>CEO Soltau currently earns $5,877,000 a year... isn&#x27;t that enough motivation?

Imagine you are a manager&#x2F;executive - would you rather be the manager of a stable happy ship, or would you rather be a manager on the Titanic while it&#x27;s sinking?<p>A sinking ship needs a better captain than a stable ship.<p>A big company needs executives whether you like it not, and they need to attract experienced executives who can properly manage the business.<p>The executives they have now needs to be paid well to make sure the bankruptcy process goes as smoothly as possible and return maximum value to shareholders.<p>Sure JC Penny could piss off their execs by saying &quot;sorry, because we are going bankrupt, no bonuses for you&quot;.<p>Hearing that, any decent exec would leave and this sinking ship. That would cause JC Penny to have a total chaotic bankruptcy process, which would likely make the business lose a lot more money.

Bankruptcy court can reverse those depending on when they were granted.