CEO vs. Plaintiff Personal Injury Trial Lawyer
A CEO’s job duties include the following:
a. Determining strategy of how the company will progress;
b. Making sure that strategy is understood throughout the company;
c. Hiring and firing a group of personnel which can bring the strategy to life;
d. Creating a path for the company to get from strategy to realization of goal;
e. Setting budgets to manage the growth of the company while maximizing return;
f. Creating a net profit for the shareholders.
For this job major CEOs are paid millions of dollars upfront along with stock options, retirement plans and benefits. If the company fails to make a profit, the CEO is usually fired or resigns with a severance package, full benefits and stock options amounting to millions of dollars. This despite the fact he failed in his or her job and the company and shareholders lost money. Additionally, none of the money budgeted or spent came out of his or her pocket.
A Plaintiff’s personal injury trial lawyer job duties include the following:
a. Determining strategy of how a case will progress from intake through trial;
b. Making sure that strategy is understood throughout the firm;
c. Hiring and firing a group of personnel which can bring the strategy to trial;
d. Creating a path for the firm to get from strategy to resolution of claim through settlement or trial
e. Setting budgets to investigate and develop of the case while maximizing return;
f. Recovering damages for the client to compensate for injuries caused by others.
For this job personal injury trial lawyer is paid nothing upfront. They receive no stock, no options, retirement plans or benefits. If the attorney fails to make a recovery for whatever reason, he or she gets nothing. This despite the fact he or she paid for all expenses out of pocket which could result of tens of thousands of dollars spent. If they do receive an offer to resolve the claim, the client has the ultimate decision on whether to accept the offer or to continue to trial. If the case is resolved the attorney will receive a percentage of the recovery which the client has approved and which the client authorizes prior to the settlement being completed.
Instead of attacking the way personal injury lawyers are paid perhaps we should have the CEO’s work on a similar structure. I would think they could even take a base salary of a $100k (since most of them do not seem to have enough confidence in their ability to do it without a base as personal injury attorneys do on a daily basis) plus a percentage of profit generated.
If CEO’s did this maybe they would consider what is best for the shareholder and company as it would directly impact their salary. They would not be spending shareholder money on expenses which do nothing for the bottom line profit of the company and they would be more selective in the risks they are willing to take with the company money. It still isn’t directly their money, but at least it will have some impact on their salary.
So next time you hear about those greedy trial lawyers why don’t you see if the person would be willing to take the same compensation package and be willing to have full accountability to their customers/shareholders.
Great perspective Brent. I will need to remember this for cocktail parties.