TIME

8 Companies That Seriously Owe Their Employees a Raise

Pile of money
B.A.E. Inc.—Alamy

Should companies with higher profit margins pay employees better?

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This post is in partnership with 24/7Wall Street. The article below was originally published on 247wallst.com.

With the stock market reaching new heights daily, companies’ profit margins at multi-decade highs, and falling unemployment, many Americans may be wondering when they will start to see the benefits of the U.S. economic recovery. For many workers, wages have remained stagnant even as the economy is making positive strides.

A number of America’s most successful companies employ large numbers of low-wage workers. These workers are hired to staff stores, call centers, and restaurants. These workers are typically paid hourly, and oftentimes earn little above the federal minimum wage of $7.25 per hour. Oftentimes, these employees serve as the face of their companies and spend most of their workday interacting with consumers.

Click here to see the companies that owe their employees a raise

Not all employees at these companies are paid modest salaries. While customer account executives at Comcast earn $13.26 per hour on average, according to Glassdoor.com figures, stars of the company’s NBC television network shows were paid hundreds of thousands if not millions of dollars a year. And while the average attractions cast member at Disney’s parks and resorts earned just $16.39 per hour, Disney also employs far higher-paid workers at its ABC and ESPN television networks.

Recently, a number of these companies have chosen to use their resources for massive deal making. In February, Comcast announced a deal to acquire Time Warner Cable for $45.2 billion in stock value. In May, AT&T agreed to acquire DirecTV for $48.5 billion. Regulators have yet to approve the deals. Last year, Verizon signed on to an even bigger deal when it bought out British telecom Vodafone’s 45% stake in Verizon Wireless for $130 billion.

Of course, companies may not necessarily have an obligation to pay their employees a higher wage. If the recent spate of mega deals is any indication, companies can spend huge amounts to help provide better returns to their shareholders.

However, many argue that companies still spend too much in executive compensation. Comcast chairman and CEO Brian Roberts earned more than $31 million last year in salary, stock options and awards, and other benefits. Bob Iger, CEO of Disney, received more than $100 million in total compensation from 2011 through 2013. Outsized salaries like these appear especially disproportionate when compared to low-wage workers.

Based on data provided by Capital IQ on S&P 500 companies, 24/7 Wall St. identified corporations with high operating income, high operating profit margins, and major one-year growth in operating income. In order to be considered, companies had to be in a customer-facing industry and have a large number of low-wage workers. We excluded financial companies, such as banks and thrifts, because the data we used to measure profitability is inadequate for judging the industry’s performance. Employee totals by company are from Yahoo! Finance. CEO pay is from filings submitted by public companies with the Securities and Exchange Commission. Figures on compensation are from Glassdoor.com and are self-reported by users to the website.

1. Time Warner Cable Inc. (NYSE: TWC)
> 1-yr. stock price change: 48.3%
> 5-yr. stock price change: 359.9%
> Total employees: 51,200
> Total CEO compensation: $14.2 million

ime Warner Cable is one of the nation’s largest telecom companies, with revenue of more than $22 billion and operating income of $4.6 billion last year. Although Time Warner Cable is not growing especially quickly, it continues to generate large amounts of cash from its operations and return profits to shareholders. The company’s stock has been one of the S&P 500′s better performers over the past twelve months, up 48.3% in that time. Some of the stock price rally is the result of the company’s deal with Comcast, which agreed in February to acquire Time Warner Cable. The merger will combine the nation’s two largest cable operators. But while shareholders reap the benefits of the deal, many employees may be left in the lurch as a result. Part of the deal’s appeal is an estimated $1.5 billion in savings from operating efficiencies, which may include job cuts. According to Glassdoor.com, the average customer service representative at Time Warner Cable makes just $11.85 an hour, and the average inbound sales representative earns just $11.41 an hour.

ALSO READ: The States With the Strongest and Weakest Unions

2. Public Storage (NYSE: PSA)
> 1-yr. stock price change: 12.7%
> 5-yr. stock price change: 156.7%
> Total employees: 5,200
> Total CEO compensation: $9.2 million

Public Storage owns more than 2,200 self-storage facilities across the U.S. and Europe. Because of its low-cost business model, Public Storage recorded a nearly 50% operating margin in its latest fiscal year, higher than nearly all other companies in the S&P 500. Its earnings were actually higher than its operating income because of the earnings it recorded from its investments in Shurgard Europe, a European storeage company, and PS Business Parks, a U.S. commercial real estate company. While highly profitable, Public Storage pays the average relief manager just $10.57 per hour, and the average property manager only $10.50 per hour, according to Glassdoor.com.

3. Michael Kors Holdings Limited (NASDAQ: KORS)
> 1-yr. stock price change: 49.7%
> 5-yr. stock price change: 290.3%
> Total employees: 9,184
> Total CEO compensation: $7.6 million

Michael Kors’ retail operations have grown rapidly in recent years, with comparable store sales up 26.2% last year, due largely to increased sales of accessories and watches.The company also added more than 100 new stores in most recent fiscal last year. Alongside the expansion, total operating expenses increased considerably during fiscal 2013 by about $331 million. As a percent of revenue, however, the company’s operating costs actually declined. While the overall dollaramount allocated to salaries increased from the previous fiscal year, Kors sales associates are paid an average of just $10.37 per hour, according to Glassdoor.com, although they can also earn commissions.

Click here to see the rest of the list.

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MONEY Careers

What to Do When You Find Out You Earn Less Than Your Predecessor

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Some sources say that the recent firing of New York Times Executive Editor Jill Abramson—shown here with her predecessor, Bill Keller, in 2011—was owed in part to her complaints about earning less than Keller. FRED R CONRAD—The New York Times/Redux

How to tell whether you should march into your boss's office -- or just suck it up.

Q: I just found out my predecessor made more than me. My boss doesn’t know I know. What should I do?

A: Before you work yourself up into a fury, keep in mind that “it’s unusual for someone to come into a role and make the same exact salary as the previous person in the job,” says Lydia Frank, editorial director at compensation data provider PayScale.com. Also, there may be a good reason that you make less.

Many factors affect compensation. Employers typically stick within a general range for each position, and where you fall within that range depends a lot on what you bring to the table–your years of experience, your unique skill set and your education. Unless those attributes are identical to those of your predecessor, you shouldn’t necessarily expect to command the same salary. Additionally, as unfair as this may seem, the economy may play a role: The person you replaced may simply have been hired during more flush times at your company.

If after having weighed these factors you still see an imbalance, however, you should talk to your boss. But you’ll want to be careful about how you do it, as it can be a delicate dance to get your boss to see your side. (It’s been widely reported that one of the factors in the recent high-profile ouster of New York Times executive editor Jill Abramson was her complaints about earning less than the person she replaced.)

First, get some data behind you, since you want to avoid bringing up what you know about your predecessor’s pay. By mentioning that, “You’d be putting your boss on the defensive,” says Frank. “That’s not a conversation that’s likely to go well.”

There are several ways to find out what’s an appropriate income for your position. You can check salary sites, such as PayScale.com which crowd sources data on compensation, and Glassdoor.com, which posts company salary reports. You can also turn to your network and ask current or former colleagues for insight. (While it’s still taboo to talk about pay, it may be easier if you ask about a range.)

Then tell your manager that you’ve done some research on salaries in your position, and the data you’ve found indicates that you’re are at the low-end of the scale. From there, build your case about why you are a top performer and should earn more, using quantifiable examples of your successes and highlighting wins that align with your boss’s and the company’s goals. If your supervisor pushes back, ask what you can do to get to that next level: Get more training, add a particular skill or hit a sales target?

The bottom line: When it comes to your salary, what’s most relevant is whether you are making what you should based on the current market price for your position and your qualifications, not what the person before you earned.

TIME Executive Pay

CEO Pay Tops $10-Million Mark

First time median passes $10-million threshold

CEO pay had long since crossed the six and the seven-figure thresholds, but now it’s all about eight figures.

Median CEO pay hit a record high of $10.5 million in 2013, an 8.8% rise over 2012, according to a new joint study by the Associated Press and Equilar, an executive pay research firm. Compensation packages, buoyed by soaring stock prices, reaped the gains from the market. CEO pay continued its fourth consecutive year of gains since the recession.

The typical CEO now makes 257 times the salary of an average worker, the AP reports. In 2009, CEOs made an average of 181 times as much. More than two-thirds of CEOs in the S&P 500 received a pay raise, with the heads of banks receiving the biggest hikes, averaging 22%.

The highest-paid CEO, with a total payout of $68.3 million, was Anthony Petrello of Nabors Industries, an oil and gas drilling company.

[AP]

 

MONEY Careers

Reading This From Behind a Desk? You’re More Likely to Have a Fatter Wallet—and a Fatter Waist

While better paid, office workers are more likely to be overweight than their non-desk jockey peers. Use these tips to make sure your wallet is the only thing that's plump.

Spend most of your workday behind a desk? First, the good news: You probably make more money than someone who doesn’t, according to a new survey. CareerBuilder has found that workers in desk jobs are twice as likely to make more than $100,000, compared to those who do not work behind a desk.

Now for the not-so-good news: You’re also more likely to be overweight.

Nearly six in 10 of desk jockeys identify as overweight vs. five in 10 non-desk workers. And 46% report that they have gained weight in their current jobs.

Researchers have long known that sedentary work puts adults at a higher risk of obesity. But desk workers also told CareerBuilder about the psychic toll. Half of the respondents say that they feel “stuck inside,” and 56% say they spend most of their time staring at computer screens.

If you’re tied to a desk, here are some ways to stay fit and fight burnout:

Work on your feet

Citing the long-term dangers of sedentary work, the American Medical Association urges employers to let workers use standing desks or isometric balls. Ask your boss if you can make some changes to your workspace and spend more time on your feet.

Take a hike

Researchers have found that even short breaks from sitting are associated with better health outcomes. Every once in a while, remember to get up and walk around the office.

Do some desk exercises

One study suggests that workers today burn about 100 fewer calories than workers did in 1960. Adding short periods of exercise—such as these that you can do without leaving your workspace—to your daily routine could help keep off the extra pounds.

TIME Military

The Devil Dogs Turn Pavlovian

Sergeant Major of the Army Raymond F. Chandler, Master Chief Petty Officer of the Navy Michael D. Stevens, Sergeant Major of the Marine Corps Micheal P. Barrett, and Chief Master Sergeant of the Air Force James A. Cody, testify before the Senate Subcommittee on Personnel at the Russell Senate Office Building in Washington, D.C., on April 9, 2014. (U.S. Marine Corps photo by Sgt. Marionne T. Mangrum)
Sergeant Major of the Marine Corps Micheal Barrett testifying before the Senate. Sgt. Marionne T. Mangrum / Marine Corps

Reaction to top Marine's comments show how tough military compensation reform will be

The top enlisted Marine called for a little bit of sacrifice by his fellow devil dogs last week that has set off a firestorm that’s still raging. Senator Kirsten Gillibrand, D-N.Y., asked Sergeant Major Micheal Barrett what would be the impact of slowing the rate of growth in military compensation. He responded:

Marines don’t run around and ask and what’s on their mind is compensation, benefits or retirement and modernization. That’s not on their minds…Hey, you know what? Out of pocket, you know what, I truly believe it will raise discipline and it’ll raise it because you’ll have better spending habits, you won’t be so wasteful.

The independent Marine Corps Times newspaper lit the fuze with its headline on a story about the decorated combat vet’s comments:

Sgt. Maj. of the Marine Corps Barrett: Less pay raises discipline

That led him to issue a clarifying letter:

Recent reporting of my testimony may have left you with a mistaken impression that I don’t care about your quality of life and that I support lower pay for servicemembers. This is not true.

In fact, despite the headline, no one is talking about cutting troops’ pay. But like Pavlov’s dogs—trained to salivate at the ringing of a bell—some troops pounce at any suggestion of scaling back military compensation.

“If you consider the benefits military members exorbitant like the Sgt Maj does that’s your right, bought and paid for with the blood of the millions you think are overpaid,” said one commenter who said he earned $40,000, including combat pay, for the year he spent in Sarajevo during the Balkan wars. “It boggles my mind that anyone can justify that as well compensated considering I was working minimum 13 hr days at that time, living in a shared space with 17 other guys sharing a single bathroom and even in a fairly friendly (as war zones go) environment was shot at twice and almost stepped on a landmine,” he said. “Pardon me if I have a tough time considering that equal to managing a Kinko’s, working as an intern or selling cars.”

“Enlisted troops are rather well compensated for their education/experience level,” a second poster noted. “Not saying they deserve a pay cut by any means, but for someone in their early 20s to gross 45-55 thousand a year is nothing to sneeze at.”

“Enlisted troops are paid better than some civilian counterparts,” a third countered. “But the fact their life is on the line, there isn’t enough pay. If you didn’t serve, shut the heck up!”

A common theme among posts by readers of the Times story is that those who didn’t serve in uniform don’t have the bona fides to discuss military compensation. That, of course, is what has happened on Capitol Hill. With fewer veterans in Congress, lawmakers—perhaps feeling just a tad guilty—routinely have boosted annual military pay raises beyond what their commanders and Pentagon civilians have recommended.

Last month, Defense Secretary Chuck Hagel said he wants to take the $2.1 billion a year saved by modest trims in compensation and invest it in training and weapons. Those are the changes Barrett was discussing. Here’s what Hagel said:

We need some modest adjustments to the growth in pay and benefits…First, we will continue to recommend pay raises. They won’t be substantial as in the past years—as substantial—but they will continue. Second, we will continue subsidizing off-base housing. The 100% benefit of today will be reduced, but only to 95%, and it will be phased in over the next several years. Third, we are not shutting down any commissaries. We recommend gradually phasing out some subsidies, but only for domestic commissaries that are not in remote locations. Fourth, we recommend simplifying and modernizing our three TRICARE programs by merging them into one TRICARE system, with modest increases in co-pays and deductibles for retirees and family members, and encourage using the most affordable means of care. Active-duty personnel will still receive health care that is entirely free.

The firefight suggests just how tough it is going to be to tame military spending. After all, the Marines have the largest share of first-termers among the four services, many of whom stay for only a single four-year hitch before moving on with their lives. If words from the senior enlisted leatherneck can set off such a storm among his troops, it’s likely to be even tougher to convince soldiers, sailors and airmen that they may be forced to relax their webbed belts a little more slowly than they had planned.

But this shouldn’t come as much of a surprise. The fealty the nation has shown its warriors since 9/11 has put it into this predicament. Granted, it is impossible to place a price on the blood U.S. troops have shed on behalf of the 99% of the citizenry who elected not to serve, nor on the mental wounds more than a decade of war has inflicted on many of them.

But it’s also true that U.S. troops—all volunteers—earn more than 90% of their civilian counterparts with similar education and experience.

“In my 33 years, I have never seen this level of quality of life ever—we have never had it so good,” Barrett told the Senate panel. “If we don’t get a hold of slowing the growth, we will become an entitlements-based, a health-care-provider-based corps, and not a warfighting organization.” Those are words you often hear in private, but rarely out in the open.

In some quarters, the military is increasingly sounding less like a service, and more like a guild.

TIME White House

Obama To Require Overtime Payments For More Salaried Workers

A forthcoming rule from the administration is part of the president's effort to work around Congress on wage issues ahead of the midterm elections

President Barack Obama will order the Department of Labor to take steps to force private-sector employers to pay overtime to more salaried employees, a White House official confirmed Wednesday.

The administration’s proposed rule-making under the Fair Labor Standards Act, first reported by the New York Times, would push employers to pay overtime to more workers by raising the weekly wage cap full-time employees have to hit before being ineligible for overtime. The move, which will come Thursday, is one component of the president’s efforts to work around a divided Congress this year, while positioning Democrats favorably before this fall’s midterm elections.

Under current regulations, salaried employees making less than $455 a week must be paid overtime, a threshold set in 2005 by the Bush administration. In 1975 it was $250 per week, the equivalent of $970 in today’s dollars. The White House is not yet revealing its proposed new cap—which will be subject to public comment and will likely face strong opposition from the business community—or when it will kick in. But a White House official said the proposal will help “millions,” and offered up California and New York as models for the proposal. Those states have set thresholds of $640 per week and $600 per week (which will increase to $800 per week and $675 per week in 2016), respectively.

“Due to years of neglect, one of the linchpins of the middle class, the overtime rules that establish the 40-hour workweek, have been eroded,” the official said. “As a result, millions of salaried workers have been left without the protections of overtime or sometimes even the minimum wage. For example, a convenience store manager or a fast food shift supervisor or an office worker may be expected to work 50 or 60 hours a week or more, making barely enough to keep a family out of poverty, and not receive a dime of overtime pay. It’s even possible that some of these workers make less than the minimum wage per hour.”

The move follows an executive order by Obama to raise the minimum wage paid to new federal contract workers, as well as a public relations push to raise the federal minimum wage under the banner of “Opportunity for All.” The White House is betting on Republican opposition to the popular legislative and executive actions to boost Democrats in the polls this year.

MONEY career

Ace Your Annual Review

No two words inspire more dread in managers and employees alike than these: performance reviews. Rather than letting your annual checkup get you down, though, consider the upside. This is one of the few times of the year you get to chat with your boss about your career. And with a bit of strategizing, you can set the stage for a big raise or promotion in the year to come.

Show you’re a top performer

Your supervisor probably doesn’t recall your every accomplishment over the past 12 months, so jog his or her memory. Richard Klimoski, a management professor at George Mason University, suggests submitting a one-page self-evaluation before the review. That way you draw the baseline from which your performance is measured. Sum up the year in three to five major contributions — with evidence. Highlight, for example, that you increased sales by 20% and share a testimonial from a new client. You’ll seem more genuine if you also identify skills or knowledge you must gain to take your performance to the next level.

Request a real critique

“Even when you don’t agree with it, feedback is useful,” Steve Miranda of Cornell University’s Center for Advanced Human Resource Studies says. “It provides insight as to how you’re being perceived.” You’ll need this information to clear hurdles standing between you and your career goals.

Related: Baby on the Way? Time to Make a Budget

Unfortunately, managers are often as uncomfortable giving negative feedback as subordinates are at receiving it. So you may have to drill down to get real advice. You might say, “I understand my presentations could be better. Perhaps I should work with a public-speaking coach?” Respond positively to criticism, owning up to problems and offering solutions; if you really disagree, ask for examples, so you can separate fact from perception.

Plan your compensation

Even if your review is tied to a pay increase, this generally isn’t the time to fight for more money — budgets are typically set by the time of the review, says Lori Holsinger, a principal at New York HR consulting firm Mercer.

Related: From Real Estate Exec to Laundromat Owner

What you can get: details on the salary review process to help you prep for next year. Find out how and when your raise was decided and who was consulted. Did you get a big bump? Ask what actions you can take to repeat the result. Vice versa if you got pennies.

Get on board with the boss

End the conversation by asking for measurable short- and long-term goals, advises Dallas career coach Jean Casey. Align at least a few of these objectives with your supervisor’s. You might say, “I know our department is dealing with a budget deficit. What can I do to help?” Your efforts to get on the same page will most likely make your manager happy, which will in turn keep your career moving forward. As Casey puts it, “You want to work with the boss — not for the boss.”

MONEY Careers

The Salary Boost of Working Out

Working out regularly pays off, in more ways than one. Photo: Spencer Higgins

Get fit and get a raise?

Exercising three or more times a week leads to 6% higher pay for men, on average, and 10% for women, Cleveland State researcher Vasilios Kosteas reported recently.

The hike is due to exercise-induced productivity boosts, he says, and is separate from the well-established link between obesity and lower earnings.

Fiscal fitness plans

Start at the office. A health club can cost more than $500 a year, but your health plan may give you a break. Customers in 23 Blue Cross/Blue Shield plans (see blue365deals.com for details) can buy memberships for only $300 a year.

Plus, one in five employers subsidize gym costs, says Aon Hewitt.

Join forces. Two-thirds of trainers lower their prices for groups, so team up with friends to request a per-person rate that’s 20% to 30% less than for a one-on-one session, advises fitness industry consultant Bryan O’Rourke.

An extra payoff: Exercising with pals gives you accountability and support — not just a deal.

Related: When not to call your doctor

Buy a gym. For less than $200, you can get a gym bag’s worth of essential exercise gear: dumbbells, resistance bands, a jump rope, and a fitness ball. Then use Nike’s free Training Club iPhone app to guide you through your workout.

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