More than 56,000 Kodak retirees got a rude jolt this week when a bankruptcy judge agreed with the company's request to terminate their benefits.
Perhaps the U.S. Supreme Court was right, after all. Companies are people, too. They are not immortal, their promises can be broken, and like all fallible folks, they will probably--wittingly or unwittingly--let you down numerous times in the course of your life and theirs. Moreover, they may not honor contracts to customers, suppliers, investors, their local communities, or even employees.
Richard Diehl just found out how fickle both man and enterprises can be. Diehl, who lives in Greece, N.Y., worked 36 years for the
Eastman Kodak Co. and wrongly assumed he had earned from a grateful company "retiree medical, dental, life insurance and survivor income benefits." On Monday, Diehl and 56,000 other Kodak retirees got a rude jolt when a bankruptcy judge agreed with the company's request for the termination of those benefits, effective December 31.
Kodak in a pre-ruling
statement said it could not "support continued payment of retiree benefit" even after initiating several cost-reduction actions that included laying off "nearly 4,000 employees this year and exiting or winding down several businesses and the proposed sale of our Personalized Imaging and Document businesses."
Kodak is clearly a troubled company, and its many problems are spilling over to all employees -- current and retired -- suppliers, customers, and shareholders. The once-mighty photographic equipment, printing, and imaging company is fading slowly into oblivion with sales dropping sharply each of the last four years, and net losses piling up in the hundreds of millions. The company's market value has dwindled to less than $60 million, and its shares now trade as a penny stock on the PINK exchange. Sadly, the company that gave millions worldwide the photography equipment to record their memorable moments today is lacking even a smidgen of its own previous glory.