Sonic Automotive Inc , which operates 95 U.S. car dealerships, started laying off and furloughing about a third of its workforce as the ...
Sonic Automotive Inc , which operates 95 U.S. car dealerships, started laying off and furloughing about a third of its workforce as the coronavirus pandemic crushed its sales. Then it changed its executives' pay packages - handing them a multimillion-dollar windfall.
Sonic said in one of the filings that the changes were made in response to the pandemic, without elaborating. Neither the company nor Smith responded to requests for comment from Reuters. Thomson Reuters said in a filing that it had approved executive performance targets in February and early March without the benefit of being able to consider the pandemic's impact on its business, which it said it would continue to monitor and assess. David Crundwell, a vice president for corporate affairs, referred to the filing and declined to comment further.
To be sure, many top executives will likely see their pay go down this year because of dwindling profits and lower share prices, and some companies' compensation changes may not fully make up for the pandemic's impact on executive pay. Many companies have not made decisions on whether and how to adjust executive pay amid the pandemic. Investors and corporate governance experts said they are watching closely.
The previous pay plan would have awarded stock to executives based on earnings. Sonic replaced it with options that gave executives the right to buy company stock, starting in 2021, at the beaten-down price the shares hit on April 9 of this year - at the height of the pandemic, when their value had been halved from their most recent peak.
Other firms made more modest changes that cushioned the blow for executives without making them whole for any pandemic-related loss of pay. G-III furloughed and laid off between 60per cent and 80per cent of employees, depending on the segment of its wholesale and retail operations.
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