High pay rates stay despite firm's loss
State-owned coal miner Solid Energy has more than a quarter of its staff earning double the average wage and a chief on $1.1m when the company made a loss of $40 million this year.
Solid Energy's 2012 annual report shows it chief executive Don Elder was paid $1.1m in the year to June and weeks later announced he was axing the jobs of a quarter of the staff to save millions of dollars in costs.
Elder's 2012 pay is $250,000 less than what he was paid the year before because he received less in performance payments.
The details were in the company's 2012 annual report released yesterday.
However it is reported differently in the "Total Remuneration" table in the report which says Elder earned $1.346m.
That is not his actual pay and is made up of his base pay for 2012 and "incentive" payments earned in 2011 but paid early in the 2012 financial year.
Solid Energy paid more than a quarter of its staff - some 472 out of about 1800 - more than $100,000 in the 2012 financial year.
Questions about Solid Energy's excessive costs have been raised before. It had nearly 400 people earning between $100,000 and $200,000 in 2012, the annual report shows.
Large companies are obliged to disclose how many people earn more than $100,000 in bands of $10,000.
The number of people earning between $100,000 and $110,000 nearly doubled in 2012 to 116.
In many of the salary bands the numbers increased considerably.
For example, 12 people earned $210,000 to $220,000 in 2012 compared to only 4 the year before.
Similarly, eight people earned $260,000 to $270,000 when only two did the year before.
Elder's pay has two basic parts - a base pay which is set each year by the board and short term and long term "incentive" performance payments where he can earn the same amount again as the base pay.
His base pay was $805,640 - 3.2 per cent higher than the year before.
The board was prepared to pay him a short term performance payment of $164,350. That was only 40 per cent of what he could have earned in that category.
However Elder declined to take anything in that short term category.
For the long term incentives the board said the payment should be $304,129 - 75 per cent of what he could have earned. This payment is judged against performance objectives for the three years 2009-2012.
So overall Elder's pay - $1.1m - was 69 per cent of the maximum amount he could have earned which was $1.613m.
Elder told the board he wants to take a 10 per cent cut to his base pay in this 2013 financial year.
- © Fairfax NZ News