Skip to main content

View Diary: No thanks to Walmart (145 comments)

Comment Preferences

  •  Pull up Lexis/Nexus (2+ / 0-)
    Recommended by:
    6412093, Treetrunk

    and find me a successful suit over rank-and-file employee compensation.

    Good luck with that.

    /dropsmic

    •  Read what I said. (2+ / 0-)
      Recommended by:
      AlexDrew, Treetrunk

      I did not ever say that simply raising employee pay would be justification for liability.  There are lots of instances where raising employee pay can be in the best interests of the corporation.  If an officer raises employee pay AND has worked through the numbers to show that there is a benefit to the corporation, of course he will not be sued for that.

      What I said is that if an officer raised employee pay while knowingly and intentionally disregarding what is good for the corporation, THAT would be a breach of the fiduciary duty.  Acting knowingly and intentionally in disregard of the best interests of the corporation is virtually a per se violation of the fiduciary duty.   People get sued for THAT -- for acting in a way that knowingly and intentionally disregards the best interest of the corporation -- all the time, especially when a corporation is no longer profitable as a result.

      Since you apparently did not carefully read what I wrote before, I'll say it again as simply as possible.  

      -- raising employee pay with justification (for example, economic data) as to how that will benefit, or at the very least not harm, the corporation = no breach of fiduciary duty.

      -- raising employee pay while knowingly and intentionally disregarding what is good for the corporation,  and loss of profitability results = breach of fiduciary duty.  

      Certainly no one gets sued for raising employee pay if it's justified by what is in the best interests of the corporation.  I've expressly made that distinction.

      •  I get your point (2+ / 0-)
        Recommended by:
        jbsoul, Treetrunk

        and acknowledge its validity:  If the company raised wages and publicly stated it was doing so because of social pressure and civic duty, it would be problematic.

        However, I don't think anyone is saying or suggesting that Walmart (or any other business, for that matter) raise wages using that argument.

        The argument is a Henry Ford-esque "paying employees better is good for the bottom line of the company."  There is plenty of economic theory to back that argument up and insulate them from suit.  Could some nutjob shareholder still file one anyway?  Sure.  Would they be successful?  Very unlikely.  That's the point.

        I most certainly read what you wrote.  What you don't seem to be getting is outlined in my second paragraph of this response.  You're arguing against an argument not made here, and going after the diarist because the diarist didn't clearly communicate what he meant with his comments about "no laws" in a manner that you understood.  The intention of his comment seemed pretty clear to me, however.

Subscribe or Donate to support Daily Kos.

Click here for the mobile view of the site