Many companies are lowering performance goals and adjusting numbers they use to determine executive bonuses, making it more likely their leaders will get bonuses no matter how the business performs, according to Bloomberg.
Nashville, Tenn.-based HCA Healthcare used earnings before interest, taxes, depreciation and amortization to determine whether the company's CEO was awarded incentive bonuses in 2020. The company removed results for March and April 2020 from the EBITDA calculation and said it no longer believed the original targets were appropriate because of the COVID-19 pandemic, according to Bloomberg.
HCA CEO Samuel Hazen got a $3.5 million annual bonus after the company's adjusted EBITDA numbers exceeded the revised targets, Bloomberg reported.
HCA adjusted the numbers in light of the COVID-19 pandemic "and the related factors that were outside of management's control, as well as the extraordinary efforts of our executives and employees in responding to the crisis," the company said, according to Bloomberg.
The bonus was part of Mr. Hazen's $30.4 million compensation package in 2020. Mr. Hazen and other HCA executives saw their base salaries reduced by 30 percent from April 1, 2020, through June 30, 2020, in response to the pandemic.
Mr. Hazen received a $4.5 million bonus for 2021 because the company surpassed EBITDA targets with no pandemic adjustments, according to the report.