Hertz Global Holdings dropped its plan to hand out as much as $5.4 million in executive incentive bonuses this year after the judge overseeing the company’s bankruptcy called the idea “offensive.”

Instead, Hertz will push forward with an $8.2 million bonus program for less-senior managers, designed to motivate them while the company reorganizes in bankruptcy, the car renter said in a court filing Wednesday. Hertz may try again to give the executives a bonus next year, the company said.

“In the face of the court’s strong statements, the debtors seriously considered abandoning the incentive plans altogether,” Hertz said in the court filing aimed at persuading U.S. Bankruptcy Judge Mary Walrath to allow bonuses for lower-ranking executives.

Last month, Walrath sided with opponents who argued that the bonus program came too soon after $16.2 million in retention money Hertz agreed to hand out to about 340 employees just days before it filed for bankruptcy in May. Walrath’s decision nixed a plan to split as much as $5.4 million in bonuses among 14 top executives and allowed an additional 295 lower-ranking managers to share up to $9.2 million.

As part of the original deal, employees agreed to forgo their 2020 bonuses, Bloomberg Law previously reported. The new bonuses were “in reality the 2020 bonuses under a different name,” according to the U.S. Trustee, the Department of Justice’s bankruptcy watchdog. Hertz argued in today’s filing that the retention bonus is different from the proposed incentive payments.

If approved, the new plan would move three of the 14 executives into the program for lower-ranking managers and reduce potential payments to vice presidents by 20%. That plan would cut the maximum cost of the incentive program by $1 million.

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About 85% of managers in the current proposal got paid under the pre-bankruptcy retention plan that Walrath cited last month.

Under the pre-bankruptcy retention plan that Walrath criticized, Chief Executive Officer Paul Stone — who took the job in May — received $700,000. With the executive plan that Hertz is dropping for this year, Stone would have collected as much as $1.6 million.

The U.S. Bankruptcy Code restricts bonus payments to top executives, in part by requiring them to be tied to performance goals. Retention payments are allowed, but have different restrictions.

Congress wrote the rules to ensure managers who drove a company into bankruptcy were not rewarded for staying around during a Chapter 11 case, Walrath said during a court hearing last month.

To justify the new program that may pay incentives to managers who also got a pre-bankruptcy bonus, the company argued that such payouts have happened in other bankruptcy cases this year.

“Many companies that have commenced Chapter 11 cases since the onset of the Covid-19 pandemic have recognized the need to modify their pre-crisis compensation programs in order to maintain compensation levels for employees that bear no fault in the original goals becoming obsolete,” the company said in the filing.