In the wake of Nortel’s plan to reduce its annual costs by a cool $100-million a year by switching to a defined-contribution pension plan from a defined-benefits plan, CEO Mike Zafirovski has stepped up to the plate as well by volunteering to pare back his “special annual pension” by 29% to $355,000 a year instead of $500,000. It’s a nice gesture but likely not the kind of thing that will win over the troops. Mike Z. is still eligible for Nortel’s regular pension plan and has several million stock options in the kitty so it’s not like he’ll be struggling in his retirement. It should also be noted that ex-CEO Bill Owens is receiving a annual pension of $1.18-million from Nortel even though he only spent 18 months as CEO. Over the past couple of years, Nortel has done a terrific job making sure his senior executives head off into the sunset with sweet packages.
Mike Z. Takes a Pension Haircut…Kinda