Best Buy’s new CEO stands to take home millions of dollars -- even if he’s legally barred from taking the job.
The electronics giant’s compensation agreement with its new CEO, Hubert Joly, includes a provision that would allow Joly, a French citizen, to net $6.25 million from Best Buy even if he can’t get proper authorization to work in the U.S. and join the company, the Minneapolis Star-Tribune reports.
Joly’s contract, which the company disclosed Tuesday, also nabs him a $20 million signing bonus and a $1.75 million base salary plus millions more in stock options.
Giving a potential CEO money for doing nothing may not be the best use of company, especially when the electronics retailer saw its profits plunge 90 percent last quarter. The company has also already taken flack for its executive compensation policies. Don Delves, an independent pay consultant that worked for Best Buy for seven years, resigned from his post last month after the retailer awarded 100 managers bonuses that weren’t tied to performance. Delves helped come up with a company strategy that tied pay to performance.
Still, Best Buy isn’t the first company offer its CEO a big sum of money for not doing work. After his company merged with Kinder Morgan last year, El Paso CEO Douglas Foshee became eligible for a $95 million exit package if he walked away from the company within two years. And in 2005, John Kanas, former CEO of North Fork Bancorp took home $185 million when he left the company after it was acquired by Capital One.
Earlier this month, Progress Energy CEO William Johnson netted $44 million after spending just one day has chief executive of a new company that was the result of a merger between Progress and Duke Energy. Johnson was ousted as CEO within hours of the merger, but still took home the millions.
(h/t the Consumerist)