[104-10219-10005.pdf — page 104]
# SECRETundoubtedly wish to reward his long years of loyal service with a generous termination payment. He has earned it, and only termination for cause per paragraph 10 (b) of his contract would prevent him from receiving it.3. Mexican law (it is the law, not custom) says that an employee who is fired must be paid three months' salary plus twenty days' salary for each full year employed by the company at the pay rate existing at the time of separation. GERENDE's current cover company adheres to this formula. Since GERENDE's termination clause has always read that he would be paid a full month's salary for every year of service (in the event of his termination by WOFIRM), we would not want to change that, and in fact we wish to add to it the three months' pay guaranteed by Mexican law. At the same time, we do see some virtue in the suggestion in paragraph 3 of Pef B that full retirement benefits (in the event of GERENDE's resignation) would apply only after 20 years' service, with lesser benefits until then. Our suggestion would be that in the event of his resignation prior to 15 full years of service (i.e. prior to 18 March 1970) he be paid twenty days' salary for each full year, that after 15 years but prior to 20 he be paid this amount plus three full months' salary, and that aïter 20 years he be paid three months' salary plus one months' salary for every full year. It is true, of course, that Mexican law does not make any provision for payment of a termination bonus to an employee who resigns, but most enlightened companies have some sort of retirement program, and, as Ref B correctly points out, "working for WOFIRM is a very special case and deserves exceptional financial consideration." In the case of GERENDE, we are not attempting to establish any pattern. This is a special case (as are most) and the Station merely wishes to insure that GERENDE, who has made WOFIRM a career without receiving any career benefits in return, is rewarded for his loyalty and is given some incentive for the future. GERENDE is not without his faults, and he is being adequately compensated for the work he performs, but we cannot expect to get more out of him without showing him greater respect.4. The Station requests, therefore, that the following amendment be made in paragraph 11 of GERENDE's contract:a. In the event of GERENDE's termination by WOFIRM, he will receive three months' pay plus one month's pay for every full year of service since 18 March 1955, calculated at the rate applicable at the time of termination.b. GERENDE's resignation upon 60 days' notice will be accepted by WOFIRM as being in its best interest, and GERENDE will be eligible for terminai payment according to the following formula: Prior to 18 March 1970, GERENDE will receive. 20 days' pay for every full year of service since 18 March 1955; after 18 March 1970 but prior to 18 March 1975, GERENDE will receive three months' pay plus 20 days for every full year since 18 March 1955; after 18 March 1976 GERENDE will receive three months pay plus one month for every full year of service since 18 March 1955. All payments are to be calculated at the rate applicable at the time of resignation.5. Paragraph 10 (b) will, of course, remain in force.6. Ref D asked that GERENDE's contract be extended for another year without change. We assume that this has been done, although we have not been notified.