Gender isn’t the problem during salary negotiation, researchers say. Here’s what’s to blame

It’s a common misconception women aren’t as skilled as men when it comes to salary negotiation. A new study out of the University of Southern California offers more evidence it’s a myth.

As they explored barriers to equitable pay in STEM fields, researchers determined neither gender excels when negotiating compensation. If women appear worse in real-world scenarios, they said, it can be chalked up to recruiters’ implicit biases. READ MORE

Sen. Bernie Sanders backs John Deere strike, citing CEO salary up 160% during pandemic

Senator Bernie Sanders, the unofficial leader of the progressive movement, has released a statement of support for 10,000 union workers at John Deere now on strike. Union members are demanding higher pay after the company reported a jump in profits, and executive salaries increased during the pandemic. Supporters say workers on the factories deserve a slice of the profit after staying on the job during the outbreak of COVID-19. READ MORE

SEC reopens Dodd-Frank Act comment component

Securities and Exchange Commission (SEC) officials said the agency has reopened the comment period regarding proposed rules addressing listing standards for erroneously awarded compensation recovery.

According to the SEC, interested parties will be able to submit additional comments and data related to rule amendments the SEC initially proposed in 2015, in addition to comments surrounding questions raised by the panel in its reopening release. READ MORE

Microsoft’s board boosts CEO Satya Nadella’s annual compensation to nearly $50M

Microsoft CEO Satya Nadella’s total compensation rose more than 12% to $49.9 million in fiscal year 2021, ended June 30, the company’s new proxy statement shows.

Nadella’s base salary remained the same, at $2.5 million. The increase in total compensation came in stock awards, totaling $33 million for 2021, up from $30.7 million for 2020; and cash bonus, or “non-equity incentive plan compensation,” which was $14.2 million for 2021, up from about $11 million for 2020. READ MORE

How to ask for a raise when companies are desperate for workers

Asking for more money? In this economy? Exactly.

After a tremendous amount of instability over the past couple of years, demand for workers is up and many businesses are hoping to retain their employees. That feat has seemingly become more difficult as some 4.3 million people quit their jobs in August, a sign American workers are looking for better opportunities and pay. In September, a disappointing 194,000 jobs were added, but job openings still outnumber unemployed workers. READ MORE

SEC Reopens Comments on Compensation Clawbacks

In 2015 the SEC proposed rules to implement Section 954 of the Dodd-Frank which added Section 10D to the Securities Exchange Act of 1934. Section 10D requires the SEC to adopt rules directing the national securities exchanges and national securities associations to prohibit the listing of any security of an issuer that is not in compliance with Section 10D’s requirements for disclosure of the issuer’s policy on incentive-based compensation and recovery of incentive-based compensation that is received in excess of what would have been received under an accounting restatement. Many refer to Section 10D as the clawback rules. READ MORE

States With the Widest Income Gaps

The United States has some of the highest levels of income and wealth inequality in the world. U.S. Federal Reserve data shows that the wealthiest 10% of Americans control $93.8 trillion, more than double the $40.3 trillion in the hands of the remaining 90% of Americans. 

The income and wealth divide only appears to be growing wider. A January 2020 report published by the Pew Research Center found that over the last four decades, income growth for the top 5% of families by earnings has far outpaced income growth for families in lower income strata.  READ MORE

ISS Releases Results Of 2021 Policy Surveys

This alert summarizes the results from ISS’s 2021 policy surveys, which were released on October 1, 2021. As we explained in our previous alert, ISS collects information each year from institutional shareholders, corporate issuers, corporate directors and other market constituents in the form of a survey to inform its policymaking decisions for the following year. The survey questions are interesting because they provide a first glance into policies that ISS is considering changing or adopting – although of course not all of the questions translate into policy updates, and there are typically policy updates that weren’t reflected in the survey. READ MORE

Bill introduced in Congress to end executive bonuses in bankruptcy

A Democratic Congresswoman from Illinois has introduced a bill in the U.S. House of Representatives to end bonuses awarded both before and during bankruptcies for executives who make more than $250,000 per year.

Representative Cheri Bustos, who was joined by Tennessee Republican Representative Tim Burchett in sponsoring the bill, said in an interview with Reuters that the legislation introduced Tuesday is intended to prevent top officers from taking home additional compensation while lower-level employees are laid off as a result of the bankruptcy. READ MORE

SEC breathes new life into 2015 executive compensation clawback rule

The U.S. Securities and Exchange Commission (SEC) on Thursday voted to revive a rule, left unfinished since 2015, that would expand the regulator's powers to clawback executives' compensation when a company had to restate its financials due to a compliance lapse.

The SEC said it would seek a further round of public feedback on the rule, which was mandated by Congress following the 2007-2009 financial crisis, with a view to finalizing the rule likely next year. READ MORE

Pandemic Hits US Bosses' Pay, But Impact Varies

Pay growth for top executives at some of the largest US firms slowed last year as the pandemic hit, and bonus payments fell, a survey showed, shedding light on how this population cohort of affluent individuals has fared. 

Willis Towers Watson’s Global Executive Compensation Analysis Team crunched the pay numbers on executives in S&P 1500 companies. There were smaller increases in both target and earned total CEO pay in 2020, increasing at the median by 4.7 per cent and 3.9 per cent, respectively. That is slower than the 6 per cent in target pay and 5.5 per cent increase in earned pay observed in the previous year and the lowest results since the 2015 to 2016 cycle. READ MORE

Pay streaming is about to upend salaries as we know them

Tied to the antiquated 2-4 week pay cycle, millions of Americans live paycheck to paycheck. Nearly half (42%) of U.S. full-time workers find it hard to meet household expenses on time each month, a recent survey showed. That means if an unexpected expense occurs, like a car repair, many people are forced to carry high-interest credit card debt or succumb to payday loans, which carry upwards of 300% interest. Alarmingly, there are now more payday loan storefronts in the U.S. than McDonald’s franchises. READ MORE

$21 is the new $15 in minimum wages at more companies

USAA is increasing wages by a little over 30% for its lowest-paid employees, as the nation's 29th-biggest bank joins Bank of America — the second-largest — in paying an hourly rate of at least $21.

The wage hike took effect on Sunday and translates into an annual salary of $43,680, in addition to retirement and other benefits, the San Antonio, Texas-based employer of 36,000 announced on Monday. Prior to this week, USAA had been paying an hourly minimum of $16, a buck more than the $15 minimum being called for in proposals to increase the federal minimum wage of $7.25.  READ MORE

Why your CFO's compensation declined compared to the CEO's

Businesses were less likely to increase CFO pay in fiscal 2020, in part because of the economic fallout from the pandemic.

Financial performance in 2020 fell compared to previous years. Median revenue declined 1 percent, and operating income increased 1 percent — below 2019 increases of 3 percent and 5 percent, respectively. In a typical year, performance at these levels likely would have resulted in more meaningful compensation decreases. READ MORE

Focus on S corps and shareholder compensation

The Treasury Inspector General for Tax Administration (TIGTA) recently summarized its findings concerning efforts by the IRS to identify S corporation reasonable compensation issues. The report concludes that the IRS is likely failing to adequately identify S corporations that are underreporting their shareholders’ compensation in an effort to avoid employment taxes. Interestingly, in its response, the IRS largely disagreed with the inspector general’s conclusions and its related recommendations. READ MORE

Millions of people earning higher minimum wages can probably thank new Nobel Prize winner

If your state recently raised its minimum wage, there’s a good chance new Nobel Prize winner David Card helped make it happen.

Card co-pioneered research in the early 1990s that showed raising the minimum wage didn’t necessarily cause businesses to lay off workers and hurt employment. Before his famous study, economists almost universally believed increasing the minimum wage cost jobs. READ MORE