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Sun Sept 14 2008 11:21:14

Possible Layoffs at eBay, Golden Parachutes for Execs

By: Ina Steiner

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Barrons cites a Wedge Partners report that "the company's business is "deteriorating" and that the company is readying layoffs that could affect 10% of the company's 15,000 employees."

If there are layoffs, it will be interesting to compare the severance packages of "regular employees" and managers with those of eBay's top executives.

Like many corporate boards, eBay's Board of Directors put into place Golden Parachutes for its top executives. It appears from SEC filings that some top execs will receive two years' target cash compensation, defined as annual base salary plus target annual incentive bonus. That "bonus" is usually 100% of salary, so it would be like getting 4 years' worth of pay if they are laid off. (President and CEO John Donahoe's target bonus is 125% of salary.)

Donahoe and Dutta's severance packages are detailed in this SEC filing.

Here's one example of a Golden Parachute. On July 16, 2008, eBay revealed in an SEC filing that the company's Chief Financial Officer Bob Swan would receive a severance package in the event of his termination without cause:

providing a cash payment equal to two years' target cash compensation (defined as annual base salary plus target annual incentive bonus) if the termination occurs within two years of the date of the severance agreement, one and one-half years' target cash compensation if the termination occurs more than two but within three years of the date of the severance agreement, and one year's target cash compensation if the termination occurs more than three years after the date of the severance agreement.

Meg Whitman and her inner circle of top executives are gone. I use that term loosely, since some, including Bill Cobb and Whitman herself, are on the payroll through the end of the year; Whitman gets office space and IT and secretarial support for 3 more years and will stay on the Board at least until June 2010. Rajiv Dutta, who retired recently, is working with his replacement Lorrie Norrington on the transition until October 2008 and will subsequently act as a consultant through the end of the year.

With layoffs reportedly looming, it now seems quite significant that Bob Kagle, the Benchmark venture capitalist who has been on the Board from the beginning, chose to step down from the Board in June.

The cynic might say Whitman would prefer any large-scale layoffs to come after election day - she and Carly Fiorina are economic advisors to Republican candidate John McCain, and bad news at eBay would not reflect well on the campaign. But layoffs in the prime holiday shopping month of November would not be good for eBay business.

I have no inside information about the likelihood of layoffs. The management of eBay has been a bit of a mystery for the last year or so. But if they are coming, I'm eager to see exactly where the cuts occur.

Update 9/15/08: eBay's public relations department did not respond to an email inquiry sent today about the report of layoffs at the firm. I got Wedge Partner's Ryan Hunter on the phone this afternoon, but he told me he had no comment about the report he co-wrote with Brian Blair, nor would he agree to send me a copy of the report.

In an overlapping note of interest, Alan Lewis, Creator and Product Manager for eBay Desktop, blogged today that he is leaving eBay. He wrote that the decision to leave was personal and "had nothing to do with anything else that is going on at eBay right now," linking to the Barron's article about the layoffs.

I interviewed Alan twice for the AuctionBytes podcast series. He'd been at eBay since 2004 and said in his farewell post that the people who work at eBay are basically good. He also wrote, "I made it known before leaving that I strongly believe that the future for auctions growth at eBay is in eBay Desktop, and I hope that message got through."

 




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Possible Layoffs at eBay, Golden Parachutes for Execs   Possible Layoffs at eBay, Golden Parachutes for Execs

by: Tina

Sun Sep 14 11:59:05 2008

I sure hope Donahoe is one of them.........

Possible Layoffs at eBay, Golden Parachutes for Execs   Possible Layoffs at eBay, Golden Parachutes for Execs

by: o.c.d.collectibles

Sun Sep 14 12:26:55 2008

Well, golden parachutes do not protect ANY employee from golden showers! As a local government employee in a high stakes area around our Nations' Capitol, we (HHS) all know fairly well how management "movement" occurs from within.

It's not always visible to outsiders, but from the inside we always know how the system "works". The managers who don't do very well, get moved along behind the scenes making it look like they WANTED to go, or that they received a better offer somewhere else.


They get moved from one department to another, or a new job is created for them somewhere else, to keep them busy and productive, but miserable, so they can be forced to CHOOSE to go. (happens all the time!) This usually is a way that they just "wear" the employee down.

There are many methods to force an employee to go, by either creating a documented trail of evidence that shows the mistakes they made, things they said out of context, and small but cumulative "causes" that will be a bat over their head while they are being asked to leave voluntarily.

If they leave for "personal reasons"(that's what will be publicized), or a new job elsewhere, they get no benefits package. So that parachute is good ONLY if the company chooses to let go of highly paid CEO members just in order to save money, but typically, if money saving is the goal, the smaller worker's salaries get to "go" first.

Those workers have no parachutes, and unfortunately, no labor union to protect them. The types of departures you'll see will tell you more about the reasons for leaving than anything else. When there is no information at all, it's because someone was getting the golden parachute protection in order to keep quiet, or because there is litigation for forced firing due to the fictitious causes that were created in order to force the CEO to leave involuntarily.

Very political, I can see where they had to do that with Meg, because she was there for so many years. But te ones who were here for a short time will not have a long documented history of success like she had, theirs will look more like a short documented trail of mistakes. That gives rise to evidence based decisions that are with "good cause".

Ebay will have to be very careful if they plan on forcing these manipulative CEO's out that way, unless they want more law suits in their hands, and that would risk them exposing even more of their corrupt business practices.

Just remember, Meg is still a voter on the board, and she is also a self- proclaimed politician with years of politics within this company's walls. She knows what she is doing, and this might have been some of the plan behind it, I would guess that she was not quite ready to leave ebay, and that JD was not who she would have chosen to follow her if she WAS ready!LOL!

It stands to reason that if she was NOT ready to leave ebay, it would be easy to help(as a board member) vote for someone to follow her who she knew would fail.(we've seen that in the gov't too!LOL)

Just my 2 cents!

Possible Layoffs at eBay, Golden Parachutes for Execs   Possible Layoffs at eBay, Golden Parachutes for Execs

by: BuhBye

Sun Sep 14 12:34:23 2008

Honestly, what did EBay EXPECT?

1)  They have totally alienated the sellers, from top to bottom by instituting hostile policies, backed up by an non-responsive customer service team, supported by inept management.

2)  They change their policies so rapidly, even the most seasoned business people cannot keep up, and many have left.

3)  Whenever they make a technical change, it is WEEKS of glitches & the old lie/deny story from them, followed by how much they 'understand your frustration' but 'cannot assist'.  The latest debacle was the 'Best Match' (which was designed to HELP the best sellers) which was broken for WEEKS in spite of EBays lie/deny policy.  Top sellers (the ones who earned the right to take advantage of Best Match) reported sales down by as much as 80%.  Ebay finally admitted the glitch, but 'understood sellers frustration' but 'would not provide any sort of compensation for lost business'.

4)  They have frightened the top buyers away by not policing their site properly (as shown by losing several lawsuits in rapid succession).

5)  By trying to 'go corporate' by enticing the 'big retailers' to list, they have lost sight of their vision and mission.  If I want a DVD from a big retailer, I'll go to Walmart.  I won't go to EBay and hunt and peck.  Nobody wants to shop on-line & wait when they can get the same item locally.

6)  By forcing PayPal down our throats, both buyers and sellers.  Nuff said.

7)  By hiring a corporate clone reject for a CEO who refuses to listen to reason, even when the numbers ram it down his throat.

8)  By disguising significant rate hikes as 'decreases' & then trying to BS the very people who know better.  The last one cost sellers AT LEAST 10%.

8)  Ebay has survived by the goodwill & synergy of BOTH buyers & sellers being equal, and having an equal stake in EBays success.  They have lost this synergy, and the present management is too inept/inexperienced to even know where to begin to get it back.

EBay is dying.  Their stock is in the celler, and the last one out needs to turn out the lights!

Possible Layoffs at eBay, Golden Parachutes for Execs   Possible Layoffs at eBay, Golden Parachutes for Execs

by: Unsympathetic eBay Seller

Sun Sep 14 12:40:47 2008

To quote Bob Dylan..."How does it feel to be a rolling stone?" I remember an auction that eBay pulled, not too long ago, where a guy was auctioning off a tube of KY. Sounds like some of eBay's employees might need to stock up on it?

Possible Layoffs at eBay, Golden Parachutes for Execs   Possible Layoffs at eBay, Golden Parachutes for Execs

by: DSR Feedback Hater

Sun Sep 14 12:57:04 2008

Gee, EBay, how is the DSR & no negs for even the worst buyers working for you now??  How about that Best Match!  Gotta love it!  No more downloadable software....great policy......last rate hike...work of genious!

I guess the people that really matter on EBay (buyers and sellers), the ones who put the money in your gucci pockets are telling you loud and clear that EBay is going down the tubes, and that your awful policy changes were wrong.

Hopefully, the board will be clamoring to fire Mr. CEO Nincompoop for the incompetent nincompoop that you are!

Possible Layoffs at eBay, Golden Parachutes for Execs   Possible Layoffs at eBay, Golden Parachutes for Execs

by: Mary

Sun Sep 14 13:25:48 2008

I MADE THIS POST IN MAY OF 2008, I THOUGHT ITS GOOD TO RE-POST.

THIS THE FUTURE OF EBAY, BELIEVE IT OR NOT.

1) Ebay is restructuring is model. It is in a process of phasing out auctions.  (I know you do not believe me.) It is has decided to be somewhat like Amazon, a superstore. It’s also streamlining its company.

2) Phase out auctions and make it BUY IT NOW: The auctions times which are now mostly 7 days, will eventually decrease to 5 then 3 then Fixed Price Only. (Just like Amazon). This will decrease the time from purchase to payment to receiving the item. As is, it takes 7 days for the auction to last, it can take any where from 1-7 days to receive payment from buyer, it takes about 2 days to prepare for shipment, and it takes about 3-7 days for the buyer to get the item. So it can take anywhere from 10-21 days for the transaction to be completely success from bid to having it delivered to the buyer. That is along time and lot problems can pop up. Ebay wants to cut that down to 2-10 days from purchase to delivery. (Why you ask?) $$$$$$$$$$$$$$

3) All items will be NEW only. That means Ebay will not allow the sales on used or pre-owned items. This will cut down customer dissatisfaction and make the Return Policy a mandatory aspect. If it new and unopened no reason to why you can’t take it back. They will push out sellers who sell used items to other sites like Ruby Lane. But, some new items cannot be returned, CONDOMS, ADULT SEX ITEMS, PERSONAL HYGIENE PRODUCTS, those things cannot be retuned. So it should be interesting to see how they will handle that. Maybe those things will be an exception to the rule or eliminated from their directory.

4) PayPal ONLY. Well that is being set up in some places already. It will set PayPal up as AMAZON PAYMENTS, meaning you can use your credit, debit or bank account to pay thru PayPal for the item that you purchase. You know that little box in your auctions listing that says: “If You BUY IT NOW you have to make immediate payment thru PayPal. If you do not make an immediate payment someone can still buy the item.” (Sounds familiar) Amazon has that. You put it in the cart on Amazon, and when you do checkout, if your credit Card is no good the transaction will not go thru and someone else who has the funds can buy it. By doing this Ebay eliminates the non-paying bidders.

5) PayPal ONLY continues with CHARGE BACKS. They found that a lot of charge backs happen because the buyer does not recognize the charge on his statement. They open inquires thinking it’s a fraudulent transaction. They buy something May 1, the statement arrives May 31, by then they already forgot what they got. Why you ask? Simple. They go on EBAY, Purchase from seller id DANDYCANDY, whose company name is FLOWERPOWER and the transaction on the statement says **PayPal FLWPWR Exotics***. Of course they get confused. I would too. Too many ids. Ebay wants to eliminate that, they want one thing EBAY & PAYPAL AND TRANSACTION NUMBER on your statement. You might not remember who you bough it from but your remember buying on EBAY and paying via paypal.

6) FEEDBACK that will eventually be dismantled completely. Many of you might remember when eBay came out with reviews. I bet everyone thought what is the point of a review, especially if eBay sells so many one of a kind item. But it was test and to let people get comfortable with reviewing. This way NEW only item (NO vintage, antique or used) can get reviews because there are more then 1 in the market. You won’t waste your time selling bad products and move on to good ones. At least that is eBay’s plan.

7) FEES, eBay will change its fees. No more per listing fee. You will pay a monthly fee and list as much or as little as you want. This also forces you to have an eBay store. That is why they lifted two seller restrictions - the Choice Policy and the Multiple Listings Limit Policy. So you will have monthly fee or yearly (if they are being charitable) and then a finale fee which will jump to 10%-15% per item depending on the price. They will rollout the scale of how they calculate your final fee.

8) CUSTOMER SERVICE: So with all these changes eBay will pull itself out of the middle and will not be involved so much with the customer service. They will focus primarily on seller services and let PayPal deal with Payment service. So if the buyer is not happy they can go through their credit card and PayPal. Or talk to the seller and resolve it. The way Amazon handles it now.

9) SHIPPING: EBay and USPS came out with FREE eBay co-branded shipping boxes. Do you know why? As part of their streamlining they will chose one carrier (USPS) as their mandatory shipping agent for eBay sellers. That means no more UPS or FEDEX or DHL or any other service. They will link it with PayPal where a tracking number is mandatory to fall under the seller protection policy at least in the USA. They will do that in all eBay operating countries eventually. Making the postal service in each country they are in, as the only eBay shipping service. This will get them in good standing with all the governments. Since almost all postal services are government based agencies with sub contracts to private carriers. EBay the largest auction in the world will drive revenue to the postal services. This will sit well with many if not all governments and it so much easier to close your ears and eyes to any misdeeds if the largest auction or SUPERSTORE to be is adding money into the treasury.
I shipped a package via DHL per customer request using the clients account number. When I went to put a tracking number it gave me 2 options USPS or UPS. Soon it will be just one. USPS!!!!!!!!!!
You will see that very soon.

So in conclusion with these changes and streamlining eBay is becoming proverbial MTV, it started as Music Television but it is now Teeny Bobber shows and reality crap. Video did not kill the radio star. The radio star joined the MP3 player and killed the video and the CD. Who saw that one coming? Not me. So Ebay will change from the auction site to superstore. But in its change it will leave a very bloody road. The ironic thing is the biggest change will be inside eBay. As all stream ling companies they will do the one thing no one in the company is expecting.
As TRUMP says: YOU ARE FIRED. They will let go up to 15-20% of their staff.

We are so busy protesting and arguing with ebay that we are not looking at the big picture. Look at GOOGLE, YAHOO, MICROSOFT, AOL and others. They know what is going on, they are waiting and planning to jump from behind the curtain and harpoon Ebay and stuff it and place it on their mantel.

Ebay has gotten so big it could cannot see around or behind itself. Keep your friends close and your enemies closer. Ebay is so into itself it does not see what others are doing and when it realizes it will be too late. That is why it went on a diet. But unfortunately there are so many other things in the works that eBay is a little too late.

I know most who read this will not believe me. But maybe a few will, and that is all that matters. Oh I am sure this post will end up on some idiot’s desk on eBay.  Wondering how can I know?  Sometimes your friends are your worst enemy.

Possible Layoffs at eBay, Golden Parachutes for Execs   Possible Layoffs at eBay, Golden Parachutes for Execs

by: Fight The Future

Sun Sep 14 13:27:48 2008

Everyone wants to blame CEO Donahoe for these changes as if they were all his plan and doing. Don't kid yourself. No CEO and company of eBay's size can work that fast. These changes were planned while Meg was still in charge. Maybe it's why she brought Donahoe on last year, so she could retire and campaign knowing someone she trusted would steer the company in the direction she thought was best.

eBay members who disapprove of Whitman and Donahoe's ''new'' eBay need to vote not just with their wallets or their feet but also in the voting booth. Do we want a President in office who will be eBay's friend and protector at the highest levels? Do we want to reward Meg for what's happening at eBay by making sure the ''new'' eBay is politically untouchable?

Don't like Obama, don't vote for him, write in anybody you want, but don't support McCain, the candidate supported by the woman who helped engineer eBay's downfall.

ANYONE BUT WHITMAN/MCCAIN '08

Possible Layoffs at eBay, Golden Parachutes for Execs   Possible Layoffs at eBay, Golden Parachutes for Execs

by: The Graduate

Sun Sep 14 13:53:35 2008

''layoffs that could affect 10% of the company's 15,000 employees''

It should be 50% from the top level down.

Call it ''Disruptive Innovation''.

Possible Layoffs at eBay, Golden Parachutes for Execs   Possible Layoffs at eBay, Golden Parachutes for Execs

by: HealthyJerky4U

Sun Sep 14 13:54:37 2008

Paypal's returns on money market used to be at over 5% for several years...The return investment on our accounts, is barley over 2% now and has been like that since the new take over...

Paypal can guarantee NOTHING to its users...

Paypal is NOT FDIC insured...

eBay/Paypal are a HUGE bag of burning crap, waiting to get stepped on...

Possible Layoffs at eBay, Golden Parachutes for Execs   Possible Layoffs at eBay, Golden Parachutes for Execs

by: Keith

Sun Sep 14 13:59:54 2008

If eBay's board canned all these idiots now and paid them whatever they agreed to when they where hired AND THEN put things back to the way they were lets say 18 months ago they would be better off.

Or they can just continue down this path of self destruction and be left with worthless pieces of paper and I would be happy to tell them what to wipe with them.  

Lets see what happens when the stock drops below $20.00 a share.  That is sure to rattle a lot of cages!

After seeing what many of the ''insiders'' hold in stock I think I would rather see the company tank, even at my expense as they have much much more to loose than I do.  It is SICKENING!!!!

Possible Layoffs at eBay, Golden Parachutes for Execs   Possible Layoffs at eBay, Golden Parachutes for Execs

by: angryjim

Sun Sep 14 14:02:49 2008

Ina: thanks for posting information on how eBay is now starting to suffer the consequences of its ill advised, bone headed, ongoing series of policy changes.  When eBay is finally taken over by a new owner hopefully they will have a good case for proving corporate malfeasance by current management and have grounds for denying these absurd severance payments.  Failure should not be rewarded so generously.  

Possible Layoffs at eBay, Golden Parachutes for Execs   Possible Layoffs at eBay, Golden Parachutes for Execs

by: ss

Sun Sep 14 14:20:28 2008

LAYOFFS

Worker compensation $0.00

IVORY TOWER  Big Bucks

Its ashame but I for one believe if you have losey customer service and bad glitches then you need to lay off some of the fat.

Possible Layoffs at eBay, Golden Parachutes for Execs   Possible Layoffs at eBay, Golden Parachutes for Execs

by: voodoo

Sun Sep 14 14:32:41 2008

Donna A Hole should be the first to get it.

Possible Layoffs at eBay, Golden Parachutes for Execs   Possible Layoffs at eBay, Golden Parachutes for Execs

by: Ainokea

Sun Sep 14 14:42:11 2008

eBay will slide into nothingness like AOL. eBay is full of bad sellers. I know this because eBay keeps telling me how hard they are working to protect me from all the bad sellers.

I will never buy or sell on the site again. I use it for price checks when buying on other sites. If I want books movies or music I buy at Amazon. For collectibles I am finding my favorite sellers on Bonanzle.com

Ai no kea bout eBay no mo

Possible Layoffs at eBay, Golden Parachutes for Execs   Possible Layoffs at eBay, Golden Parachutes for Execs

by: Welcome2OurWorld

Sun Sep 14 15:18:09 2008

Welcome to eBay Dead! It's like watching a train wreck in slow motion and there's nothing we can do to stop it. I wonder if it would help to have a new conductor???

Possible Layoffs at eBay, Golden Parachutes for Execs   Possible Layoffs at eBay, Golden Parachutes for Execs

by: TankingeBay

Sun Sep 14 15:56:08 2008

Meg was hoping for the Vice Presidential Nomination...eBay has become Big Democratic Government---Main Concern-feeding itself! Dismayed, Meg is Giving Her Stock Away--Selling it.  eBay Failing and Layoffs would not make for a Good Cabinet Position for Meg! Take the Money and Run!

Possible Layoffs at eBay, Golden Parachutes for Execs   Possible Layoffs at eBay, Golden Parachutes for Execs

by: Tired

Sun Sep 14 16:04:18 2008

I wonder what Griffs take will be on this?

Maybe thy already canned his two faced rear end.

Possible Layoffs at eBay, Golden Parachutes for Execs   Possible Layoffs at eBay, Golden Parachutes for Execs

by: Wrong Is Right

Sun Sep 14 16:27:48 2008

''by: Mary  [ clact ]
I MADE THIS POST IN MAY OF 2008, I THOUGHT ITS GOOD TO RE-POST.''

No IT's not. One puff piece does not side step hundreds of posts disavowing eBay of any fault or responsibility.

Well it appears tht eBay sellers and buyers are tired of the excuse that IT's not eBay's fault, that it's something else.

The revenue of eBay's competition is rising, while eBay's is shrinking. But IT's not eBay's fault?

IT is eBay's fault.

Corporation's do not decimate (1 in 10) their work force unless something is terribly wrong.

People in major eBay po$t$ are moving on. Something about rats on a sinking ship.

500 IT personnel do not pack up and leave unless they see something is wrong.

Sellers do not pack up and move to Amazon and elsewhere unless something is wrong.

The motto of neo-eBay may be 'Wrong is Right', but that doesn't make it right.

Possible Layoffs at eBay, Golden Parachutes for Execs   Possible Layoffs at eBay, Golden Parachutes for Execs

by: whatever

Sun Sep 14 16:34:17 2008

Instead of Golden Parachutes, I'd like to see Meg Whitman, King JD and the other executives who have cheated, robbed and destroyed Ebay be held legally responsible for sucking away all of the money sellers invested in Ebay.

Possible Layoffs at eBay, Golden Parachutes for Execs   Possible Layoffs at eBay, Golden Parachutes for Execs

by: Daisy

Sun Sep 14 17:05:50 2008

JD can keep his golden parachute, but I hope his face shines from magazine covers as the man who destroyed Ebay.

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