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The Associated Press reports that American CEOs got an 8.5-percent raise last year, taking in a median of $11.5 million in salary, stock, and other compensation. It's the biggest CEO pay increase in three years.
The raises are a reflection of the bull market in stocks.
"Boards of directors increasingly require that CEOs push their stock price higher to collect their maximum possible payout, and the Standard & Poor's 500 index returned 12 percent last year," the AP reported. READ MORE
On April 27, Hewlett Packard Enterprise held an all-hands meeting for the thousands of people in its North American salesforce and apologized to them.
The company's internal software, which tracks how much each person has sold and their sales commissions that form the bulk of their pay, was still not working properly, a top HPE exec confessed matter-of-factly. READ MORE
With President Trump targeting federal employees’ retirement programs and House Republicans taking aim at their compensation generally, Uncle Sam’s goal of being a model employer looks shaky.
The administration’s fiscal 2018 budget proposal, scheduled for release Tuesday, includes a series of cuts to retirement programs, as The Washington Post reported last week. Then, amid a torrent of reports denoting Trump as unfit, unprepared and unbecoming, Republicans took time for a hearing to promote the notion that feds are overpaid. READ MORE
Think Tim Cook is paid too much?
Apple investors may now have a chance to change that. In an Oct. 26 letter, The Securities and Exchange Commission said that Apple could not exclude a vote on whether the company should hire multiple outside experts to reform its executive compensation practices from its annual proxy. That proposal was submitted to Apple by an investor, Jing Zhao. READ MORE
Last year was a very challenging year for Chipotle, one that was well documented and caused company officials to take strident measures to take control of food safety, experiment with a temporary loyalty program, and restore brand loyalty among its customers.
Now, Chipotle management is tying employee compensation in its restaurants to high customer service scores. Is this a good or bad idea and what elements are involved in this that could bring a positive or detrimental effect? Can this impact the overall customer experience? READ MORE
The 2018 revenue recognition standard could affect companies’ compensation or bonus plans because measurement methods used under the old rules will change, a senior Deloitte & Touche LLP executive told a conference May 8.
“A lot of companies have some type of bonus arrangement, compensation plan, or some type of compensation for their employees and executives and invariably all those types of plans have some sort of link to revenue,” Deloitte senior consultation partner of revenue recognition Eric Knachel said at a Deloitte and Bloomberg BNA conference on revenue recognition. READ MORE
Average compensation for CEOs at some of the largest companies in the U.S. clocked in at $16.6 million last year, up from $15.5 million in 2015, according to a study by executive data firm Equilar.
The study, which looked at figures from the 100 largest corporations by revenue that filed proxy statements covering 2016 before April 1, found the median pay increase for CEOs was 6%, the largest bump since 2013. READ MORE
On Tuesday afternoon, the House voted to pass a bill that Republicans have promoted since the Newt Gingrich era, one that would allow private-sector employees to exchange overtime pay for “compensatory time" off, electing to accrue extra hours off rather than extra pay in their wallets. The bill passed 229 to 197, largely along party lines.
The bill -- which supporters say would add flexibility to hourly workers' schedules while opponents worry that it wouldn't do enough to protect employees -- is not a new idea. It seeks to take a similar provision that has been available to government workers since 1985 and extend it to private-sector employees, making it legal for them to choose between an hour and a half of paid comp time and time-and-a-half pay when they work additional hours. READ MORE
One of Snap 's Wall Street critics said he's reasonably positive on the stock in the long term — but Thursday's stock sell-off exposed one of the company's biggest risks.
"I don't think that the company needs to be concerned about that, except for the fact that a lot of employees who work there have been issued significant amounts of [restricted stock units] which are dependent upon a high stock price," said Brian Wieser, senior analyst at Pivotal. "The biggest risk for the company is, 'How do you manage a workforce whose compensation is largely stock-driven, if the stock comes down to earth?'" READ MORE
Snap Inc.’s first quarter loss will likely lead to a large tax deduction.
The photo messaging app and camera company reported a $2.2 billion first quarter loss, of which, about $2 billion came in the form of a stock compensation expense. The charge is an accounting one, meaning it isn’t a drain on Snap’s cash pile.
Snap issued tens of millions restricted shares and stock options to employees as a form of payment, with the stock slated to vest once the company became public. The stock grants are an expense for Snap, because they’re an alternative to cash compensation. And the company can claim a tax deduction for the difference between the price at the time stock was granted and market price when it vested. READ MORE
A federal court ruled last Thursday that employers can legally pay women employees less than men when it's based on previous salary history. The 9th U.S. Circuit Court of Appeals overturned a previous court ruling that established that pay differences based exclusively on prior salaries were discriminatory under legal protection created by the federal Equal Pay Act. This previous ruling also overturned the opinion of U.S. Magistrate Judge Michael Seng, who said in a 2015 decision that women's earlier salaries are likely to be lower than men's specifically because of gender bias. READ MORE
U.S. Congresswoman Eleanor Holmes Norton (D-DC) today introduced the Pay Equity for All Act of 2017 with original cosponsors Representatives Rosa DeLauro (D-CT), Jerrold Nadler (D-NY), and Jackie Speier (D-CA) to prohibit employers from asking job applicants for their salary history before making a job or salary offer, according to a press release.
The bill — which was first introduced last Sept. — seeks to reduce the wage gap that women and people of color often encounter. The bill is particularly vital after the U.S. Court of Appeals for the 9th Circuit overturned a lower court ruling that determined that pay disparity based exclusively on past salaries was discriminatory under the Equal Pay Act. READ MORE
Employers can pay men and women differently if that disparity is based on salary history, a federal appeals court has ruled.
The Equal Pay Act only prohibits pay discrimination based on sex, the 9th U.S. Circuit Court of Appeals said April 27 in Rizo v. Yovino (No. 16-15372), and salaries are a “factor other than sex.” The ruling applies in Alaska, Arizona, California, Hawaii, Idaho, Montana, Nevada, Oregon, and Washington.
The decision comes as several states and cities are adopting laws that prohibit employers from asking job applicants about their salary history. The measures are aimed at undoing decades of pay discrimination based on sex. READ MORE
Mayor Bill de Blasio, a Democrat, signed a bill on Thursday that makes it unlawful for those involved in the hiring process to inquire about what an applicant currently makes -- a measure that takes aim at the gender pay gap.
"This is about fixing a broken history. This is about overcoming years and years of discrimination that held people back," de Blasio said at the signing ceremony. READ MORE
This past march, Walt Disney Co. settled a claim by the Department of Labor that it had violated the law by deducting the cost of uniforms from employees’ wages—which brought the workers’ pay below the federal minimum wage. The violations, which occurred at Disney facilities in Florida over the past few years, didn’t add up to a lot of money. Disney will pay back wages of $3.8 million to 16,000 workers (about $230 per employee). What made the story galling is that the entire expense is roughly in line with what Robert Iger, Disney’s CEO, earns in a single month. Last year Iger netted $44 million. READ MORE
Wages and benefits paid to U.S. civilian workers grew steadily in the first three months of the year.
The Employment Cost Index, which tracks wages and benefits, was up 0.8 percent in the first quarter, the Labor Department said Friday. That’s the biggest quarterly growth since December 2007 and slightly faster than the 0.5 percent growth in the last quarter of 2016.
Wages and salaries, which account for 70 percent of compensation costs, rose 0.8 percent. Benefit costs, which cover pensions and health insurance, increased 0.7 percent. READ MORE
Several large pension funds and proxy advisory firm Institutional Shareholder Services are against ratifying the compensation of Virginia Rometty, CEO of International Business Machines Corp., and four other top executives.
Ms. Rometty's total pay rose to $50.9 million in fiscal year 2017, up from $20.8 million in fiscal year 2016, according to a report last month from ISS. The pay of the four other executives named in the management proposal ranged from $7.3 million to $9 million in fiscal year 2016. READ MORE
A new Congressional Budget Office report confirms what a 2012 CBO analysis found: Federal employees' compensation — wages plus benefits — continues to outpace private-sector compensation for similar jobs, now totaling “roughly 17 percent more,” according to The Washington Free Beacon.
Federal workers with no educational credentials beyond a high school diploma earned 53 percent more than their private-sector counterparts from 2011 through 2015. Those with bachelor's degrees earned 21 percent more. And “benefits increased at a greater rate for federal workers than wages did,” The Free Beacon reports. READ MORE
Maybe some executives are overpaid. The good ones, however, are not. In fact, a good case can be made that many of them are underpaid.
Executive pay gets a bum rap. Looking at a total compensation number without context, it’s easy to understand why. Examine the real magnitude of what high-performing top executives actually do, though, and they morph into one of the best bargains around. READ MORE
Executive pay is just about right — for today, which assumes an efficient market. To suggest otherwise would imply that there is a market irregularity, such as a bubble or inefficiency, which causes an imbalance in executive pay.
I submit that the market for executive pay is more efficient today than it was 20, 50, or even 100 years ago, driven by three primary forces; more information, more scrutiny/attention, and more employment liquidity. READ MORE