Back to Work - Bill Clinton [38]
When I was governor of Arkansas, I helped to recruit a Nucor steel plant to the economically distressed northeast corner of our state. The company made rolled steel there. Its employees earned a modest wage but received weekly bonuses based on company profits. The bonuses usually doubled earnings, putting its workers among the highest paid in our state. In addition, the employees received an education bonus of $1,500 per year for every child they had in college. The company also had a strict no-layoff policy, which meant that if income declined, the employees’ bonuses would be reduced across the board. It happened once, in a very bad year for manufacturing in the mid-1980s. The chairman and founder of the company, Ken Iverson, sent a letter to every employee, explaining that business was down 20 percent, so everyone’s bonus would be reduced by that amount, but no one would be laid off. Then he said that since he hadn’t succeeded in finding a way to keep Nucor growing in the face of a global downturn, he was cutting his pay by 60 percent.
Fast-forward to 2009, when Nucor actually lost money for the first time. Still, no one was laid off. Employees’ hours and pay were reduced, but benefits were maintained, including the now $3,000 per child for college tuition, plus supplements to help pay the college expenses of the employees themselves and their spouses. In the toughest times, the company’s culture held fast to the values of its founder. Ken Iverson was a good Republican who believed in shared benefits and shared responsibilities. We need more executives like him.
There are more than you might think. On September 11, 2001, Jimmy Dunne was one of three men who led a small investment banking firm, Sandler O’Neill & Partners, L.P., with offices on the 104th floor of the South Tower of the World Trade Center. When the second terrorist plane turned the South Tower into an inferno and brought it down, Sandler O’Neill lost 66 of its 171 employees, including the other two men who ran the firm with Dunne. Dunne was determined both to save the firm and, in spite of its dire financial straits, to do right by the families of his lost employees. In 2001, the firm paid the lost partners’ capital to their families, paid the year’s remaining salaries, and awarded bonuses to fallen employees’ families equal to or greater than the amount earned in their best year. It offered full benefits to all of the families for five years, then later extended them for another five, and set up a foundation to fund the education costs of the seventy-four children who lost a parent. Today, Sandler O’Neill has 340 employees and partners, including 57 of the 105 who survived, another shining example of the positive economic and employment rewards of a company that values long-term loyalty, shared benefits, and shared responsibilities.
Several other firms that lost people on 9/11 also made a real effort to take care of their families and the surviving employees who needed help. The hardest hit was the large bond-trading firm Cantor Fitzgerald, which lost 658 of its 950 employees. The company gave 25 percent of its profits to the families of its slain employees and provided for their health insurance for a decade. Now BGC, a trading arm of Cantor Fitzgerald, has an annual Charity Day on which it donates all the day’s income to good causes, including those that benefit men and women wounded in military service. Another trading company, ICAP, does the same thing. For every person on Wall Street