In an unusual move, Tod's CEO Diego della Valle announced on Monday, January 28 that Tod's Group would pay out a 1400 Euro ($2070 USD) bonus to all Italian employees in 2008. What's unusual is that the bonus in question is not performance based but rather, is being paid out to employees in an effort to " (...) alleviate economic pressure and enhance their spending power". (Source) In other words, it is unrelated to an individual's performance within the group or the group's performance within the industry. A pure act of altruism? Not exactly.
Unions are portraying the move by Tod's Group as retrograde and patronizing in the manner of nineteenth century barons of industry. To understand the debate, it helps to know that a recent study by the Italian Central Bank revealed that the average spending power of Italian households has remained the same between 2000 and 2006 and this despite significant increases in the cost of living most notably in energy. Italian unions have been agitating for significant increases in wages to counter the steep rises in the cost of living for some time and see a move such as this one as undercutting their position. Tod's Group is expected to announce strong earnings for 2007 shortly.
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