NEW YORK – US retailer JC Penney recently awarded executives US$7.5m in bonuses despite the fact the company is teetering on the brink of bankruptcy. The beleaguered company is expected to file for bankruptcy in the coming days, and has left a trail of debt in its wake across apparel supply chains. JC Penney is among a host of global retailers which are refusing to pay for cancelled apparel orders – whether part or wholly completed – and news of the bonuses will rub further salt into the wound of suppliers which have not being paid.
Regulatory filings from the US have now emerged showing the company paid huge bonuses to multiple executive officers just weeks after it announced it would be furloughing most of its hourly store associates amid the strain caused by the Covid-19 pandemic. Bonuses were paid to four executive officers under a pre-paid compensation plan (PCP), in a move, the company said, was approved by its board of directors upon “recommendation of its Human Resources and Compensation Committee.”
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