Monday, March 03, 2008

It's Just a Phase

After years of yakking, policy wonks still haven't answered this question: What the Heck Are We Going to Do With All These Baby Boomers? This issue has a bunch of workplace subtopics, including: (1) How Are We Going To Get Them To Leave Once And For All So We Can Have Their Aeron Chairs? (2) OMG, Who’s Going To Do All This Work When They’ve Gone? and (3) Hey, When Can We Get Rid of This Stupid Rule The Old People Have Against Flip-Flops in the Office Cuz That's, Like, Really Stupid?

The solution to these pressing questions, some people think, is to offer “phased retirement,” gradually reducing boomers’ hours and responsibilities as they train their successors. Sensible as this sounds, it doesn’t usually work (despite some legislative fixes), because few people can afford to phase out before their pensions fully phase in, and if they cut back their hours, their medical benefits may retire and move to Fort Lauderdale.

In Proxyland, however, phased retirement is not merely a wistful dream, but a thriving institution, though it goes by a different name -- the “post-retirement consulting arrangement.” These cushy deals for outgoing bigshots come in many varieties, and may take the form of pretend jobs or involve titles like non-executive officer or Chairman Emeritus.

But at least one company has realized that "phased retirement" has a nice ring. Taking a bold semantic step, Schlumberger (SLB) states in its proxy that it follows this practice for its executive officers. Last year, for example, it signed this contract with former CFO Jean-Marc Perraud, "phasing" him down to "senior financial advisor." Through 2010, Mr. Perraud will be working no more than half-time (and quite possibly less) at a salary of $450K, plus benefits. If all boomers could phase out like that, we wouldn’t need no freaking policy wonks, thank you.

But I don’t really want to pick on Schlumberger, a company that doesn’t use employment contracts, golden parachutes or change of control agreements, and sometimes assigns its executives high-minded performance objectives involving stuff like safety, diversity, and social responsibility. Plus which, given that its arch-rival in the oilfield services business is an outfit named Halliburton, it's going to look squeaky clean no matter what I say.

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