It’s long been a goal of mine to be so awful at a job that they have to pay me to leave. Unfortunately, excellence in failure is something that has escaped me — even though I normally seek excellence in all things.
But you’ll be happy to know that football coaches, superintendents, CEOs, and even large corporations have all too often perfected the art of sucking so bad that people pay them for that failure.
These large severance packages are generally a problem when the people offering the package are doing so with OPM — Other People’s Money. Athletic directors, school boards, boards of directors, and the government find it so much easier to be generous when the money they are offering to their failed coaches, superintendents, CEOs, and large corporations is not their own money.
The Occupy Wall Street folks have (rightly) highlighted the sweet deals offered to failed CEOs and corporations from tax funds, but they tend not to mention the frequency with which superintendents are given large severance packages with OPM. Yes, the average size of the superintendent packages tends to be much smaller, but there are so many more of them that it adds up to real money.
A Chicago Tribune analysis last summer found:
The newspaper’s review of more than 100 superintendent contracts, financial records and severance agreements over a decade revealed that boards have handed out six-figure separation checks; district-paid health care; cash or retirement credit for hundreds of sick days; and, in one case, a Mercedes — all to be rid of superintendents….
“Boards have not been held responsible because they do not care about taxpayers, period. … They do not care about how much money they spend,” said Kenneth Williams, board president in Thornton Township High School District 205, which recently approved a $350,000-plus severance package for J. Kamala Buckner, a veteran superintendent. Williams tried unsuccessfully to rescind the package in May….
Using available state data, the Tribune tracked the number of superintendents in Illinois school districts from 2000 to 2010, finding nearly half had gone through three or more superintendents. That turnover not only fuels buyout deals but can take a toll on issues ranging from policy to student achievement….
Changeover also means some superintendents get multiple severance payouts.
Rosemary Hendricks got a $132,000 settlement in 2009 after filing a lawsuit against Hoover-Schrum District 157, where she had served as superintendent about a year. Earlier, she had gotten a $75,000 settlement in Bellwood District 88, where she had a short stint as superintendent, records show. She is back as Bellwood superintendent.
Of course, sometimes these generous severance packages are the fault of boards, not the departing executive. Boards sometimes choose to get rid of someone on a whim or simply because the majority composition of the board changes. These reckless changes by boards to get rid of someone under contract or who could justly sue for wrongful termination, force boards to fork over large sums of OPM to avoid litigation.
My point is the irresponsibility that OPM encourages. OPM encourages organizations to write contracts that are excessively long and generous and then require large severance packages to get out of them. OPM encourages changing leadership without cause and at great cost. OPM makes it so much easier to justify the bailout to avoid “systemic risk” or to promote “stability.” And of course OPM facilitates coaches, superintendents, CEOs, and corporations to make unreasonable demands, take unreasonable risks, and fail catastrophically.
OPM encourages excellence in failure.