USA: Companies furlough & layoff thousands of workers while continuing to reward shareholders in dividends during pandemic

Author: Peter Whoriskey, Washington Post, Published on: 7 May 2020

"U.S. companies cut thousands of workers while continuing to reward shareholders during pandemic", 5 May 2020

Since the coronavirus pandemic... [companies have laid off and furloughed]... thousands of their workers... [while] also reward[ing] their shareholders with more than $700 million in cash dividends...

Caterpillar... announced a $500 million distribution to shareholders... two weeks after indicating that operations at some plants would stop. The company declined to say how many workers are affected... Stanley Black & Decker announced... it was planning furloughs and layoffs because of the pandemic. Two weeks later, it issued a dividend to shareholders of about $106 million...

In August... companies from the Business Roundtable... announced that they were dropping their insistence on “shareholder primacy – that corporations exist principally to serve shareholders.”...But of the chief executives who endorsed the... statement, at least three of their companies are among those that have implemented... furloughs while also issuing dividends: Caterpillar, Stanley Black & Decker and Steelcase...

Steelcase... said workers... would be on temporary layoff... [and on] the same day... issu[ed] a dividend of about $8 million to shareholders... World Wrestling Entertainment... furloughed workers... and the next day announced about $9 million in dividends for shareholders...

Some companies... have... suspended the buyback and dividend programs that reward shareholders: The Gap, which has furloughed tens of thousands of employees, announced... it was suspending its dividend. So did Darden Restaurants... American Eagle Outfitters deferred its dividend and halted its stock buyback program...

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Related companies: American Eagle Outfitters Caterpillar Darden Restaurants Gap StanleyBlack & Decker Steelcase World Wrestling Entertainment