The Impact of Pay Compression on Pay Equity

The U.S. labor market has been on a roller coaster ride, from massive job losses at the start of the COVID-19 pandemic to unprecedented growth in last year.

According to the Economic Policy Institute, the labor market lost 22 million jobs in spring 2020. In the past 12 months, however, the economy added 6.6 million jobs and is on track to return to pre-pandemic labor market conditions before the end of 2022. Unfortunately, there are not enough people looking for work to fill available positions. According to the Bureau of Labor Statistics, nearly 5 million people, who left the workforce at the start of the pandemic, have not returned and are not looking for work. READ MORE

Repricing Underwater Options

Public companies in a number of sectors have recently experienced a significant decline in their share price. In addition, the conflict in Ukraine and macro-economic factors continue to impact the economy. Nevertheless, the labor market remains tight and companies are struggling to retain talent. This goal can be undermined when stock options awarded during better times are “underwater” and have therefore lost much of their incentive value. Pressure can quickly mount on boards and management to address this mismatch by “repricing” such underwater options. READ MORE

A Moderna exec will be paid $700,000 despite leaving his job after 1 day, a report says

A senior executive will be paid $700,000 in severance, despite only spending a day in his new job at vaccine maker Moderna, reports suggest. 

On Wednesday, the pharmaceutical giant announced that its chief financial officer, Jorge Gomez, had departed the company "effective immediately," following a disclosure by his former employer that it's investigating financial misreporting. READ MORE

Clarification on OFCCP’s New Compensation Directive 2022-01

Speaking to the Institute For Workplace Equality during its 2022 Annual Summit in Washington D.C., personnel from the U.S. Department of Labor Solicitor’s office (OFCCP’s attorneys) clarified the intent of the Agency’s new Compensation Directive 2022-01. Speaking to conference attendees, Beverly Dankowitz, Associate Solicitor for the Civil Rights and Labor- Management, explained the purpose of Directive 2022-01: Pay Equity Audits is to promote greater attention to proactive audits, sharing that the Directive was in no way intended to chill contractors’ work on pay equity. READ MORE

79 Percent of Employees Want Greater Pay Transparency

The movement for greater pay transparency is flourishing over the past year as many U.S. states are enacting laws requiring employers to share estimated salary ranges in job postings.

Although "pay transparency" encompasses a broad range of practices -- from listing employees' salaries to publicizing compensation policies -- it essentially boils down to employers sharing compensation practices more openly than what's traditionally expected. READ MORE

New York City Council Delays Effective Date Of Salary Disclosure Law

The New York City Council passed a salary disclosure law, Int. 134-A, at the beginning of this year in an effort to increase salary transparency and decrease wage disparities based on gender and race. The law was due to take effect this Sunday, May 15.

After the publicity and significant pushback from the business community, the City Council has amended the law to extend the compliance date, clarify some rules, and modify other rules. READ MORE

DOL Expected to Raise the Salary Basis Threshold

The United States Department of Labor (“DOL”) is expected to propose a new salary threshold for various overtime exemptions under the Fair Labor Standards Act (“FLSA”). The new proposal is likely to be issued in the near future and could be issued as early as this month. Many expect the DOL to increase the threshold from its current minimum salary amount of $684/week—potentially impacting millions of employees across the United States. READ MORE

Should you tell your coworkers your salary — or keep it a secret?

The job market is hot and so are salaries. People are quitting jobs in record numbers, often because they’ve landed a new gig with better pay. Some 40% of people who’ve switched jobs said they got a raise of 10% or more at their new company, an April survey by the tax-advisory firm Grant Thornton found. Meanwhile, wages are rising overall as employers seek to lure talent, and new state and local laws are requiring companies to be more transparent about pay. READ MORE

How to Identify Top ESG Priorities

As investors, regulators, and stakeholders increasingly recognize environmental, social and governance (ESG) risks and opportunities as financially material, companies are looking for ways to link management incentives with ESG performance on climate change, diversity and inclusion, and other key issues. Though integrating ESG goals into the existing compensation program may seem like the obvious next step, there are several processes that board members need to implement first—and critical questions that they need to address—to ensure the new compensation structure is appropriately tied to corporate strategy. READ MORE