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Friday, September 13, 2013

BBC Severance Pay: Kerfuffle or Fooferaw?

BBCBroadcastingHouseOver the summer, hte UK's National Audit Office presented to the BBC Trust Finance Committee this Report on executive severance payments made to fromer BBC executives.   The BBC has reduced its management staff signficantly since 2009.  In so doing, it expects savings totalling £92 million.  However, the BBC also has made severance payments to the 150 ousted executives totalling £25 million.  

According to the Report, the BBC plans changes going forward.  From now on severance pay will not exceed 12-months salary or £150,000, whichever is less.

The drama of Parliamentary hearings into the payments is well described here in the UK's The Guardian.  The BBC's Director General at the time of the payments was Mark Thompson, who recently moved on to The New York Times, where he is Chief Executive.  Thompson defended the payments before Parliament, although they exceeded by £1.4 million (£2 million in The Independent's account) the BBC's contractual obligations to its former executives.  The largest single payment was just over £1 million, and it went to Thompson's deputy, Mark Byford.  According to the BBC, the investigation into severance payments was triggered by a £450,000 payment to one BBC executive who resigned in connection with a scandal after just 54 days on the job.  

From an American perspective, it is a bit hard to see what the fuss is all about.  Sure, capping severance for executives at publicly-owned entities is certainly a reasonable policy, but even without the cap, exceeding contractual obligations by something less than 10% while achieving significant savings overall seems pretty tame on the overall scales of both wasteful public-sector spending and  executive severance packages.  As Brad Pitt's character puts it in Inglorious Bastards, that should just get you a chewing out.  But perhaps we have been desensitized by the size of severance packets, even at public corporations, on this side of the pond.  

Two footnotes:

1. It is perhaps telling that the Report begins with three blank pages (after the cover page) followed by two mostly blank pages.  Apparently they don't audit their own use of paper.

2. UK usage seems to have completely abandoned the hyphenated compound adjective.  Thus, after all the blank pages, the Report begins, "The BBC Trust receives value for money investigations into specific areas of BBC activity."  I had to read this sentence three times before I could make any sense of it.  That's because "value for money" is a compound adjective rather than two nouns separated by a preposition.  To my eyes, the sentence would have been far more readable if it had been written: "The BBC Trust receives value-for-money investigations into specific areas of BBC activity. "  Am I the only one?  My inquiry also relates to changes going on in Law Review offices in the US, as I have tussled with student editors who have grown hostile to hyphens in recent years.  I like the little fellas.  

[JT]

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