Kodak filed a motion in federal court to pay up to 300 workers retention awards to make sure they don't resign for other jobs.
This is the memo that went out to employees:Today we filed a motion with the U.S. Bankruptcy Court requesting approval to implement an Employee Continuity Plan, a retention program similar to plans adopted by other companies during the restructuring process. It is important to understand what this means and what role it plays in helping companies successfully emerge from Chapter 11. The Employee Continuity Plan is designed to give the company the ability to retain people in key positions based on business needs throughout the Chapter 11 process. If the motion is approved by the court, we will provide incentives to a limited number of employees, based on their critical roles in developing and delivering a profitable, sustainable business strategy. The incentive will be paid if they remain employed by Kodak through a specified period. Members of the Executive Council and certain other senior management positions are not eligible for this program. The court is scheduled to hear the motion on April 18. Assuming we receive approval for the plan, the initial group of designated participants will be notified soon after. We recognize that everyone at Kodak is working harder and doing more with less, and we value everyone who works here. But given the constraints on our resources, and the scope of a program that the court would approve under bankruptcy law, limiting the participants in the Employee Continuity Plan to mission critical positions was a necessary choice to drive toward a successful emergence from Chapter 11 – an outcome that is in the best interest of all employees. We have talked a lot about our four objectives in filing for Chapter 11. Achieving those objectives and launching the Kodak of the future requires that we successfully use the time and special resources that are made possible through a court-supervised reorganization to capitalize on our strengths. We need to move fast, operate more efficiently, and make tough choices with our new capital in order to accomplish critical goals. Thanks to all of you for doing your part as we move through this process together.
At a Glance: Employee Continuity Plan
Kodak has filed a motion with the U.S. Bankruptcy Court to implement an Employee Continuity Plan, similar to plans adopted by other companies during Chapter 11. The program will provide incentives to employees in a limited number of key positions, based on business needs throughout the Chapter 11 process. The payment is contingent on the participant remaining with Kodak through a specified period. The majority of incentives will be equal to 25% or less of a participant's base salary. Members of the Executive Council and certain other senior management positions are not eligible for the program. The plan can only cover only a limited number of key positions.
A maximum of about $13.5 million would be used under the plan. Expect about 300 total participants. Initial participants include about 120 management-level employees worldwide. The Executive Council and business leaders made the selections, which were confirmed by company Presidents and the Chief Administrative Officer. The total of incentives to these participants is expected to be about $8.5 million. The remaining funds – approximately $5 million – will be a reserve available for subsequent incentives to other employees. Future participants will be identified by their managers in consultation with Human Resources, and selections will be confirmed by an Executive Council member and the Chief Administrative Officer. The court is scheduled to hear the motion on April 18. If approved, the initial group of participants will be notified soon after.
