Journal Communications boss gets $400,000 farewell

The rumor floating around over the weekend was that Journal Communications laid off some non-newsroom people, but wasn’t willing to tell other employees exactly who got the axe or what they did for the company.

The firm’s stock price has fallen so much that some employees and retirees are in desperate financial situations. Circulation is plummeting and good people are being shoved out the door.

So given the declining fortunes of the company, what is the Journal Sentinel mother ship to do when one of its bigwigs leaves? Of course! Give him a $200,000 bonus and a $200,000 consulting contract!

(Full disclosure: I own a bit – a small bit, thank goodness - of Journal stock.)

The media company reported to the Securities and Exchange Commission on Friday that it was dropping the retirement largesse on Paul M. Bonaiuto, former executive vice president and chief financial officer.  Journal Communications announced  earlier this year that he was pulling the plug.

“The Compensation Committee of the Board of Directors of the Company approved the payment of a one-time discretionary bonus to Mr. Bonaiuto in the amount of $200,000, payable no later than March 15, 2009,” the company said in its filing.

Journal Comm also said Bonaiuto would get a two-year consulting contract that pays $8,334 a month — that’s $100,008 a year.

“Mr. Bonaiuto will consult and advise as requested with respect to the Company’s and its affiliates’ printing operations, with respect to which he has special expertise, and will otherwise provide counsel and advice as requested to, without limitation, further facilitate an orderly transition of his prior responsibilities,” the filing said.

The company also took a step to protect Andre J. Fernandez, who is now the CFO, according to the filing. Fernandez’s parachute will open if he is canned without cause or he resigns ”for good reason” within two years after a change in control of the company.

Fernandez will get 1.5 times his annual base salary and target annual bonus (contrast that to what rank-and-file employees got under the company’s buyout offers: two weeks’ pay for every year worked).  He also will get a “pro rata” annual bonus for the year and group health coverage for 18 months unless he finds another job that offers insurance.

Wow. The paper shrinks, the stock falls, layoffs happen, employees and retirees suffer and big payouts happen at the top. Go figure.