Managers’ cups are already full…

FedEx managers regularly speak out of both sides of their mouth. You can hear them say, "All these cuts – the pension cuts, the benefit cuts, the wage cuts, the personnel cuts – are because of how hard things are out there."

But then top management turns around and give themselves more – more salary, more bonuses, more stock grants, more dividend payments.

So let’s talk specifics.

Take Fred Smith. In 2007 according to FedEx Corporation forms, Fred Smith received $1.4 million in salary plus $5.9 million in stock grants or options plus $4.8 million in incentive compensation plus $5 million in other compensation for a total of $17.1 million. Then add in the $6.4 million in pre-tax dividend payments. And add the $25 million in pre-tax earnings from stock sales. So in 2007, Fred Smith got $48.5 million.

Take Alan Graf. In 2007 according to FedEx Corporation forms, Alan Graf received $870,000 in salary plus $2.1 million in stock grants or options plus $1.8 million in incentive compensation plus $2.3 million in other compensation for a total of $7.1 million. Graf received $77,000 more in pre-tax dividend payments. So in 2007, Alan Graf got $7.2 million. (Plus the $5.3 million in pre-tax earnings from stock sales in 2006.)

Take Dave Bronczek. In 2007, according to Fedex Corporation forms, Dave Bronczek received $910,000 in salary plus $1.4 million in stock grants or options plus $2.2 million in incentive compensation plus $3.0 million in other compensation for a total of $8.6 million. Graf "only" had $35,000 more in pre-tax dividend payments. (Plus the $6.6 million in pre-tax earnings from stock sales in 2006).

Even former executives whose management decisions led to unknown tax liabilities and unquantifiable potential legal claims have gotten more.

Take Dan Sullivan, the former CEO of FedEx Ground. Even after Sullivan retired, FedEx saw fit to give him a consulting contract in 2006 that paid him one half of his 2006 salary in a lump sum of $254,000 and then $36,322 per month until December 31, 2008. Sullivan’s duties include "consulting services with respect to the class action lawsuit…including providing deposition and trial testimony as necessary." The consulting contract also says that in order to earn his $36,322 per month, "Mr. Sullivan’s services will be limited to NO MORE THAN 40 hour per month" or a minimum $908 per hour.

Last is how much the part-time Board of Directors pay themselves to oversee management on behalf of the shareholders. FedEx Corporation directors have seen their cash compensation double in just 5 years. August Busch – heir to the Budweiser fortune – got $47,000 in 2003 and $96,000 in 2007. Jim Barksdale – of Netscape fame – got $47,000 in 2003 and $102,000 in 2007. Pitt Hyde – childhood pal of Fred Smith – got $47,000 in 2003 and $102,000 in 2007. The two highest paid directors in 2007 were Jim Edmondson and Peter Wilmott. Edmondson, who chaired the Audit Committee, got $118,000 in 2007. Wilmott, who chaired the Nominating Committee, got $121,000. Not a bad job if Fred Smith approves you can keep it.