Under fire for sweetening executive severance packages ahead of a painful belt-tightening for the rank-and-file,
said Monday that some top managers would give some money back.
The Troy, Mich., auto parts maker, which
filed Oct. 8 for Chapter 11 bankruptcy protection, laid out plans for a 10% pay cut in its top ranks. Delphi also said CEO Steve Miller will take $1 for his annual salary. Miller had been making $1.5 million, though he had indicated a willingness to take a pay cut.
Miller has been outspoken in calling for sharp pay-and-benefit cuts for union workers at Delphi and other auto-related companies. He has proposed to slash the value of Delphi workers' compensation by more than half to bring the company's costs into line with the rest of the global car business.
But Miller endured a storm of criticism after it was disclosed that the day before Delphi's Chapter 11 filing, the company extended the severance packages due its top executives. At the time, Miller contended that Delphi's executive compensation was subpar and that the company needed to dangle the money in order to keep qualified managers from leaving.
On Monday, Miller changed his tune a bit. Delphi said his reduced salary will take effect Jan. 1 and continue until Delphi emerges from Chapter 11. Meanwhile, Delphi President Rodney O'Neal will take a 20% cut in his base pay, and other officers with the company when Miller came on board will take 10% cuts.
"I have given the subject of executive compensation a great deal of thought and planned to announce a reduction in my own compensation, as I had previously suggested," said Miller. "In addition to my annual salary of $1, I will continue to receive zero bonus, zero severance, zero pension plan, and will have no other similar entitlements whatsoever.
"While I remain concerned about the below-market compensation paid to many of our key executives, Delphi's transformation message must be unambiguous and marked indelibly by the commitment of Delphi's leadership," Miller said. "To that end, Delphi's officers who were at Delphi when I joined, have unilaterally volunteered to give back 10%-20% of their base pay -- a clear indication of their commitment."