Episode 147 B

EPISODE 147
LEVEL B1 – B2

 

READING COMPREHENSION

 

Golden Parachutes

“Golden parachutes” get a lot of press, and they always sound like elite packages for high-level executives. Very few people get them, and very few people know how they work. Companies usually reserve them for executives at the top of the organization chart, and these contracts
establish an agreed-upon compensation package that the employee would immediately receive upon termination. The benefits package usually includes a list of specific terms that explain what the terminated employee will receive.

How a Golden Parachute Works

When someone is offered an executive position at a firm, the contract will often include a golden parachute or a walk-away pay clause. This clause states the amount of severance pay, stock options, and cash bonuses that he or she would get. The contract includes clear language about the conditions under which a golden parachute applies. The terms can be weighed so heavily in the employee’s favour that it almost seems like termination could come as good news. Some clauses cover an employee if they are terminated due to a merger. Golden parachutes have benefited companies and individuals, but they’ve also created some controversy.

Advantages of Golden Parachutes
Providing golden parachute clauses, companies are able to have an easier time finding executives. Golden parachutes are a main selling point in attracting new high-level employees. Executives typically want to have some security, especially if they are looking to work in a company that is at high risk of being bought out by another firm, or if the company has a reputation for staff turnover at the top levels. Offering golden parachutes, businesses draw from a larger pool of applicants.

High severance packages also reward risk takers. Golden parachutes can help alleviate the stress that executives feel about their job. Many of them are nervous that making mistakes or going the wrong way on key decisions can lead to losing their job, so they are reluctant to take risks or go against the status quo. Corporations need leaders who are willing to take risks, and golden parachutes can be a tool to help them be effective leaders and make bold decisions.

Lucrative walk-away pays also remove the conflict of interest that an executive would have during a merger, when executives can be tempted to delay or even sabotage the efforts because they are afraid of losing their own job. With a golden parachute clause guaranteeing their compensation, they may be more objective about evaluating a merger.

Attractive golden handshakes reduce the probability of a hostile takeover. When golden parachutes are in place, other companies find hostile takeovers less appealing because they’d be responsible for expensive termination packages. What they also do is facilitate more amicable severances. When employees are fired, they often want to retaliate against their employer. They may threaten to sue, disclose sensitive material, or take even more drastic action. Under a golden parachute agreement, they will usually be more than happy to part ways without either party feeling any tension.

Adapted from www.moneycrashers.com

 

 

Exercise  1

Find the words or expressions in the text which mean the following:

1) exclusive: __________
2) decided in advance: __________
3) money you receive when you leave a job: __________
4) when two companies are joined to form one: __________
5) an aspect that convinces you to choose one product over another: __________
6) rotation of employees at one position: __________
7) to make stress weaker: __________
8) a brave decision: __________
9) to feel the need to do sth, usually dishonest or illegal: ___________
10)attractive: __________
11)to make sth easier, to promote sth: __________
12)friendly: __________

 

Exercise 2

Match the expressions from the two columns into logical collocations:

1) to get                                       of interest
2) the organization                   position at a firm
3) the benefits                           as good news
4) an executive                          package
5) to weigh                                  takeover
6) sth comes                               a lot of press
7) to have                                    package
8) the conflict                            a reputation for sth
9) a hostile                                 the terms in sb’s favour
10)a termination                      chart

 

Exercise 3

Provide English equivalents of these expressions:

1) ustanie zatrudnienia
2) odprawa
3) premia gotówkowa
4) opcje na akcje
5) zostać przejętym przez inną firmę
6) pula
7) niechętnie podejmować ryzyko
8) dochodowy
9) sabotować
10)coś obowiązuje
11)zemścić się na pracodawcy
12)pozwać

 

Grammar corner…

When you read about the advantages of golden parachutes, you came across a sentence: Providing golden parachutes, companies are able to … The first half of the sentence doesn’t look too complete, does it? It should sound something like: Because companies are providing golden parachutes, they are able to … OR at least: By providing golden parachutes, companies are able to … However, such grammatical trick is actually more advanced and shows that you have good style by sounding more concise and to the point. Another example: Because she didn’t
know about the confidentiality policy, she revealed many corporate secrets to her friends. It can be turned into: Not knowing about the confidentiality policy, … And yet another one, in the past: Because she forgot about the deadline, she didn’t deliver on time. It becomes: Having forgotten about the deadline, she didn’t deliver on time.

 

Exercise 4

Rewrite the sentences so that they begin as shown.

1) He overlooked an important clause in the agreement, which is why he lost a lot of money. => Having …
2) He didn’t realize his boss was standing behind him and he criticized him openly. => Not …
3) Because he wanted to retaliate against his boss, he copied some sensitive files. => Wanting …
4) Because she was looking forward to her vacation, she couldn’t focus on her work. => Looking …
5) Because he knew he had a very lucrative severance package, his termination came as good news to him. => Knowing …
6) Because Saab chose not to diversify its product portfolio, it went under. => Not having …

 

GLOSSARY

to go under – zbankrutować
to diversify your product portfolio – dywersifikacja portfela produktów
sensitive files – istotne lub wrażliwe pliki
to part ways with sb – rozstać się z kimś
in advance – z wyprzedzeniem
a golden parachute / a golden
handshake / a walk-away pay / a severance package / a termination package – odprawa
concise – zwięzły
elite – ekskluzywny
agreed-upon – wcześniej ustalony
a merger – fuzja
a selling point – mocny punkt
staff turnover – rotacja pracowników
o alleviate stress – złagodzić stres
a bold decision – śmiała decyzja
to be tempted to do sth – ulec pokusie zrobienia czegoś
appealing – atrakcyjny
to facilitate sth – ułatwiać coś
amicable – przyjazny
to get a lot of press – być obecnym w mediach
the organization chart – hierarchia firmy
an executive position – wysokie stanowisko kierownicze
to weigh the terms in sb’s favour – dostosować warunki na czyjąś korzyść
sth comes as good news – coś zostaje przyjęte z zadowoleniem
to have a reputation for sth – słynąć z czegoś
a hostile takeover – wrogie przejęcie
termination – ustanie zatrudnienia
cash bonus – premia gotówkowa
stock options – opcje na akcje
to be bought out – zostać przejętym
a pool – pula
to be reluctant to take risks – niechętnie podejmować ryzyko
lucrative – dochodowy
to sabotage sth – sabotować coś
sth is in place – coś obowiązuje
to retaliate against sb – zemścić się na kimś
to sue – pozwać

 

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