The sale included large bonuses and stock options for those same Polaroid executives who took the company through bankruptcy. A year later, in 2002, Polaroid was purchased by One Equity Partners for $255 million. In the weeks before declaring Chapter 11, Polaroid executives reaped millions of dollars in bonuses. GOTBAUM: Polaroid claimed it was $1 billion in the red. O'NEILL: What I planned for originally was a good life of retirement the way it was given to me, but then I was told that there's nothing there. And the stock that the employees were forced to buy to help avoid a hostile takeover in the 1980s became virtually worthless. O'Neill immediately transferred his pension out of Polaroid, but many others lost much of theirs in bankruptcy proceedings. GOTBAUM: In the wake of the bankruptcy, O'Neill and 6,000 other Polaroid retirees lost the lifetime benefits they were promised, and thousands of other workers were laid off. You're not going to get any life or medical. O'NEILL: And he told me-he says, `Dan, don't come in Monday to sign your final papers,' that `There's not going to be any severance. But on his last day of work, O'Neill got a call from his boss with some bad news. He could also count on health and life insurance for himself and his wife that Polaroid had promised the retirees who had worked for the company for decades. As part of the deal, O'Neill was told he would receive a generous severance package. GOTBAUM: Three years ago, at the age of 61, O'Neill took early retirement from Polaroid. DAN O'NEILL (Former Polaroid Employee): For years, I was faithful to that company and everything else. Dan O'Neill worked as a machinist for Polaroid for 31 years. The Massachusetts company was as well-known over the years for its generous employee benefits as it was for its instant cameras. In its heyday, Polaroid employed some 20,000 workers. Rachel Gotbaum reports on the storied collapse of American icon Polaroid. Though many big-name companies have emerged from bankruptcy leaner and more competitive, employees rarely share their boardroom's enthusiasm. Like United, many companies now find themselves strained by financial promises made to employees, and have begun looking to Chapter 11 for relief. I'm Ed Gordon.Ī federal bankruptcy judge recently approved United Airline's default on 120,000 employee and retiree pensions, the largest in US history.
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