American International Group Inc. (NYSE:AIG) has apparently started layoffs and budgeted $57 million in "retention" pay for employees expected to be terminated, according to news reports.
"As part of restructuring the company, we will ultimately
eliminate jobs that are, at the moment, critical to maintaining
ongoing operations and winding down certain businesses," Christina Pretto, an AIG spokeswoman, told
Bloomberg. She did not say how many of its 116,000 employees the insurer plans to lay off or what departments the insurer hopes to restructure.
Where might the layoffs begin? Bloomberg seems to suggest to follow the bonus money.
According to the Bloomberg report:
"Besides the $450 million for employees in the
financial products unit that sold credit-default swaps, AIG was
to give about $470 million to staff of three other subsidiaries
and $148 million to top executives, according to the people and
company filings. Of the $450 million for the financial products unit, the
$165 million in retention pay was for 2008 and due to be paid by
March 15, $55 million was paid in December and an additional
$230 million was originally earmarked for 2009 retention
payments. Chief Executive Officer Edward Liddy has said he wants
to reduce the 2009 payments by at least 30 percent."
Perhaps Bloomberg is right on track; some AIG employees are voluntarily leaving (with retention money in pocket). It seems 11 executives quit in the controversial financial products unit, which is under fire after staff was awarded $165 million (AIG gave bonuses of $1 million or more to 73 people at the
unit, including a top recipient who got $6.4 million), according to
The Associated Free Press. The financial products unit is widely believed to be the main cause of the insurer's troubles.
The insurer has not publicly announced major layoffs since last year.
- Maria Woehr
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This letter was received in our customer service department; needless to say morale hasn't been this high since our office closed due to snowfall.
From: Harpers Ferry [mailto:harpersferry2009@gmail.com]
Sent: Friday, March 27, 2009 1:11 PM
To: Employees.aigdirect.com
Subject: Who is going to speak for us?
I am an AIG employee within the Personal Auto Group line, in November 2008 we were advised by management that all lower level employees (Supervisor and below) would lose part or all of our shift differential beginning January 1, 2009 which for some amounts to a loss of 5-20% in income, depending upon what schedule we work. The attitude of management at the time of the announcement was “be thankful we still have our jobs”, AIG executives are the biggest bunch of hypocrites ever.
Our company newsletter is called “Seize the Future” for a reason, to give select individuals bonuses for playing golf on a work day and brown nosing is appalling. The average employee who actually performs the lion’s share of work within our ranks is lucky to receive a 3-4% merit increase in any given year. Remember the good ol’ days when we got $1.83 after taxes for a $5 referral and an ice cream sandwich on Friday?
I challenge every non-exempt AIG employee to exercise your rights by submitting a complaint to your states Attorney General’s Office or Department of Labor, do not sit by and allow Ed “Dollar Bill” Liddy and his Band of Brothers to deceive you any further. Remember this, while you are slaving away on the phones, lying to the customers that “we used to be AIG, but now we’re not” your income is less and executives still get bonuses. While you are lying to the customers about why their premiums have been raised yet again, executives are out on retreats. And yet they come to you and ask “your tone sounded really somber and flat on the phone today, anything wrong?” Well it’s kind of hard to be energetic when 52 former executives receive retention bonuses of more than $1,000,000 and we are left to answer calls from angry customers as to why AIG is stealing taxpayer dollars.
When they spent $200,000 for rooms, $150,000 for meals and $23,000 for spa treatments, you and I were herded into a room for a Subway sandwich, AIG logo chap sticks and an empty green bag. When they were ready to give Martin Sullivan $19,000,000 and $600,000,000 to other executives, they came to you and me to take our money, for myself a loss of $3,200 or 4 mortgage payments.
Our old company values of People, Customer Focus, Performance, Integrity, Respect, and Entrepreneurship have been replaced by GREED. So since we are continually told “you are the voice of the customer” SPEAK UP! What is the worst case scenario? CEO forces the sale of the company under the guise of “Expansion, Restructuring and Re-branding” only to walk out the door with $40,000,000 a la Bruce Marlow or company bankruptcy? For Mr. Liddy that would be about $165,000,000 plus his $1 annual salary, for us the lumpen……….. Nothing.
I would say call your congressman, but unfortunately many of them have already taken campaign money from, guess who? That’s right AIG, see everybody gets paid for doing nothing, except for you and me.
Sincerely,
Bottom of the food chain