Abercrombie & Fitch CEO gets $4m to curb jet use

Abercrombie & Fitch is paying its chief executive $4m (£2.5m) to compensate him for curbing his use of the company's corporate jet.

The US preppy fashion retailer has altered the employment contract of Michael Jeffries, who is also its chairman, to limit his use of the aircraft to $200,000 a year. If he exceeds this amount, he must reimburse Abercrombie & Fitch.

His use of the aeroplane cost $1.1m in 2008 and averaged $850,000 a year between 2006 and 2008. But Mr Jeffries would have to pay back a "pro-rata portion" of the lump sum if he quits before 1 February 2014, according to a filing at the US Securities and Exchange Commission this week.

Mr Jeffries is not alone in enjoying the luxury of a corporate aircraft, although many firms have trimmed their usage in recent years.

Arguably the most notorious example was in November 2008, when the three chief executives of the ailing automotive companies General Motors, Ford and Chrysler flew into Washington on separate aircraft for crunch negotiations with the US government about bailing out the car industry. Following a public outcry, the three travelled by car to subsequent meetings.

In Britain, Chris Ronnie, the former chief executive of JJB Sports, came under scrutiny for his use of the company aircraft during his troubled tenure at the chain between June 2007 and early 2009.

After he left, JJB came close to collapse in the spring of last year but was saved through a series of restructuring measures.

Mr Jeffries has been chief executive of Abercrombie & Fitch since 1992 and is credited with turning around its fortunes by focusing on colourful and fashionable clothing for young people. He received a pay packet of $23.4m in 2009, boosted by performance-related bonuses and share awards.

In the year to 30 January this year, group sales at Abercrombie & Fitch tumbled by 16 per cent to $2.93bn.

In 2007, the company opened its first European store on the corner of Savile Row in London. The shop's heavily scented interior and pumping music has been compared to a nightclub. It attracts snaking queues of teenage girls who often take photos of its topless male models on the front door.

Abercrombie & Fitch also courted controversy for its policy of employing staff who look like models. In 2009, it paid a former employee with a prosthetic arm £9,000 for unfair dismissal.

Abercrombie & Fitch's stablemate, the fashion brand Hollister, has 13 branches across Britain.

Start your day with The Independent, sign up for daily news emails
ebooks
ebooksAn introduction to the ground rules of British democracy
Latest stories from i100
Have you tried new the Independent Digital Edition apps?
SPONSORED FEATURES
Independent Dating
and  

By clicking 'Search' you
are agreeing to our
Terms of Use.

iJobs Job Widget
iJobs Money & Business

SThree: Experienced Recruitment Consultant

£20000 - £40000 per annum + OTE + Incentives + Benefits: SThree: Established f...

SThree: Trainee Recruitment Consultant

£20000 - £25000 per annum + OTE 40/45k + INCENTIVES + BENEFITS: SThree: The su...

Recruitment Genius: Collections Agent

£14000 - £16000 per annum: Recruitment Genius: This company was established in...

SThree: Trainee Recruitment Consultant

£20000 - £25000 per annum + OTE 40k: SThree: SThree are a global FTSE 250 busi...

Day In a Page

Isis profits from destruction of antiquities by selling relics to dealers - and then blowing up the buildings they come from to conceal the evidence of looting

How Isis profits from destruction of antiquities

Robert Fisk on the terrorist group's manipulation of the market to increase the price of artefacts
Labour leadership: Andy Burnham urges Jeremy Corbyn voters to think again in last-minute plea

'If we lose touch we’ll end up with two decades of the Tories'

In an exclusive interview, Andy Burnham urges Jeremy Corbyn voters to think again in last-minute plea
Tunisia fears its Arab Spring could be reversed as the new regime becomes as intolerant of dissent as its predecessor

The Arab Spring reversed

Tunisian protesters fear that a new law will whitewash corrupt businessmen and officials, but they are finding that the new regime is becoming as intolerant of dissent as its predecessor
King Arthur: Legendary figure was real and lived most of his life in Strathclyde, academic claims

Academic claims King Arthur was real - and reveals where he lived

Dr Andrew Breeze says the legendary figure did exist – but was a general, not a king
Who is Oliver Bonas and how has he captured middle-class hearts?

Who is Oliver Bonas?

It's the first high-street store to pay its staff the living wage, and it saw out the recession in style
Earth has 'lost more than half its trees' since humans first started cutting them down

Axe-wielding Man fells half the world’s trees – leaving us just 422 each

However, the number of trees may be eight times higher than previously thought
60 years of Scalextric: Model cars are now stuffed with as much tech as real ones

60 years of Scalextric

Model cars are now stuffed with as much tech as real ones
Theme parks continue to draw in thrill-seekers despite the risks - so why are we so addicted?

Why are we addicted to theme parks?

Now that Banksy has unveiled his own dystopian version, Christopher Beanland considers the ups and downs of our endless quest for amusement
Tourism in Iran: The country will soon be opening up again after years of isolation

Iran is opening up again to tourists

After years of isolation, Iran is reopening its embassies abroad. Soon, there'll be the chance for the adventurous to holiday there
10 best PS4 games

10 best PS4 games

Can’t wait for the new round of blockbusters due out this autumn? We played through last year’s offering
Transfer window: Ten things we learnt

Ten things we learnt from the transfer window

Record-breaking spending shows FFP restraint no longer applies
Migrant crisis: UN official Philippe Douste-Blazy reveals the harrowing sights he encountered among refugees arriving on Lampedusa

‘Can we really just turn away?’

Dead bodies, men drowning, women miscarrying – a senior UN figure on the horrors he has witnessed among migrants arriving on Lampedusa, and urges politicians not to underestimate our caring nature
Nine of Syria and Iraq's 10 world heritage sites are in danger as Isis ravages centuries of history

Nine of Syria and Iraq's 10 world heritage sites are in danger...

... and not just because of Isis vandalism
Girl on a Plane: An exclusive extract of the novelisation inspired by the 1970 Palestinian fighters hijack

Girl on a Plane

An exclusive extract of the novelisation inspired by the 1970 Palestinian fighters hijack
Why Frederick Forsyth's spying days could spell disaster for today's journalists

Why Frederick Forsyth's spying days could spell disaster for today's journalists

The author of 'The Day of the Jackal' has revealed he spied for MI6 while a foreign correspondent