Mark Cuban has written an excellent blog post about executive compensation and layoffs.  In a nutshell he's simply asking why we don't reward executives who bust their butts to avoid laying people off.  It's a good read, and love him or hate him, I think you have to admit he makes a great point.  The first paragraph gives you a taste:

I have a simple question.  Why are profitable companies laying off people ?  I can see if a company’s survival is at stake.  If payroll can’t be met. If debt can’t be paid. Then layoffs are a necessary evil. Even if companies have created cash flow deficits through their own mistakes, that’s the nature of business. Mistakes are made.  What I have a problem with is that discussion of executive pay never includes whether or not the executive has been good enough to pre empt or prevent layoffs.