On February 22, 2023, the United States Supreme Court issued a 6-3 decision holding that an employee who is paid a day rate (without any weekly guarantee) must be paid overtime under the Fair Labor Standards Act (“FLSA”) because day rates are inconsistent with the Department of Labor (“DOL”) regulations governing many exemptions from the overtime requirements. This decision compels employers – particularly those in the energy and maritime industries that commonly rely on day rates – to re-examine their payment practices. READ MORE
DOJ Pushes Companies to Punish Misconduct With Bonus Cuts
Companies found to have committed crimes will get reduced fines from the US Justice Department if they act to claw back compensation paid to executives and employees responsible for misconduct, Deputy Attorney General Lisa Monaco said.
The department also will require every company that reaches a resolution with its criminal division to structure its compensation and bonus programs so that bad behaviors will be punished, Monaco said Thursday at a conference in Miami on white-collar crime. READ MORE
Shopify changes employee compensation model: “being a manager now has no effect on compensation”
Who is entitled to overtime? A new Supreme Court decision puts employers on notice
CFOs are concerned about compliance risks. And at a time when talent, pay, and compensation are top of mind, the highest court in the U.S. is weighing in on employment laws. READ MORE
Gen Z women expect to make $6,200 less than men after graduating—salary transparency could help
As the next generation of professionals starts to think about what their salary will look like post graduation, women are more likely to lowball themselves, a new report finds.
The impacts of the gender pay gap are felt even before women enter the workforce, according to Handshake, a career platform for college students. Their latest Gen Z salary transparency report found that, after surveying 1,853 Gen Z jobseekers, women expect a $6,200 lower average salary compared to men. READ MORE
Has your salary kept up with inflation? These jobs had biggest pay bumps since 2010
In recent years, many workers’ wages have rapidly grown. But so has inflation. A new report from Clarify Capital analyzed wage growth from the Bureau of Labor Statistics in comparison to inflation rates, and found that although wages have grown, they haven’t kept up with inflation. READ MORE
Supreme Court Upholds Salary Requirement for Overtime Exemption
Highly compensated employees can be eligible for overtime pay if they are paid on a daily basis, the U.S. Supreme Court ruled on Feb. 22 in a case that clarifies overtime exemptions under the Fair Labor Standards Act (FLSA).
In Helix Energy Solutions Group v. Hewitt, the Supreme Court ruled 6-3 that a former employee who made more than $200,000 a year was eligible for overtime pay because he was paid on a daily basis. READ MORE
Occupations that saw lowest, highest salary increases
Lawyers still earn about five times as much as bartenders and fast-food workers.
But over the past decade or so, those low-wage occupations in hospitality have ever so slightly closed the gap, a new analysis shows. READ MORE
SEC Clarifies Dodd-Frank Act Pay-Versus-Performance Rules with New C&DIs
As registrants work toward including the new required Item 402(v) of Regulation S-K executive compensation disclosure, the SEC issued new C&DIs to provide some much-needed guidance in applying the Final Rules. READ MORE
Department Of Justice Focuses Corporate Compliance Efforts On Executive Compensation
The Department of Justice’s (DOJ) recent plea agreement with Danske Bank demonstrates increasingly aggressive efforts to incentivize corporate compliance and hold individual executives accountable for corporate misconduct. The DOJ charged Danske Bank, a global financial institution based in Denmark, with defrauding banks in the United States. The plea agreement contains a notable provision that ties executive compensation and bonuses for the bank’s executives to future compliance efforts. The agreement follows recent statements by DOJ officials that companies will be expected to claw back compensation from executives who engage in misconduct. Corporate executives should be on notice that the DOJ is becoming increasingly aggressive in holding corporate executives personally accountable for compliance at their organizations. READ MORE
Guidance from the SEC for new Pay versus Performance tables
The SEC staff recently issued 15 interpretations (see Sections 128D and 228D) relating to its new Pay versus Performance (PvP) rules. READ MORE
Highly-Paid Executives May Be Entitled to Overtime Compensation
After an extensive analysis of the Fair Labor Standard Act’s (FLSA) provisions governing overtime pay as applied to highly-paid employees, the Supreme Court has upheld the FLSA’s “salary basis test” – finding that not only is the rate of pay important, so is the basis on which the pay rate is determined. The Court’s holding confirms that even very highly compensated executives may be entitled to overtime. READ MORE
Gen Z's Gender Pay Gap: Young Women Expect Much Lower Salaries Than Men
Gen Z may be known for being progressive, but young people may still be influenced by the gender wage gap when it comes to salary expectations, according to a new report.
Handshake, a college career network, surveyed over 1,800 new college graduates seeking jobs. The results show that even with pay transparency shrinking the gender wage gap in the U.S., Gen Z women respondents have lower salary expectations than men. READ MORE
The 10 Fastest-Growing Tech Salaries By Occupation In 2023
Whether it’s a DevOps engineer or a program analyst, many IT jobs saw an increased salary in 2022 despite extensive layoffs across the industry. In fact, out of 35 jobs researched 17 of them had a salary increase over the last year, according to a new Dice report.
The average tech salary increased by 2.3 percent year over year from $108,857 in 2021 to $111,348 in 2022. And the average annual salary for jobs in the IT market is more than $140,000, according to Dice. READ MORE
What inflation? Many employers will offer less generous pay raises this year.
Payscale this week came out with its highly anticipated 2023 Compensation Best Practices Report, which turns out to be a mixed bag for employees: smaller raises, maybe semi-annual salary bumps and a dollop of extras to make up for companies’ Scrooge-like behavior.
The bad news for many of us: fewer employers plan to bump up salaries this year. READ MORE
Justices decide a day-rate is not a salary
The basic rule is simple: If you earn an hourly wage and you work more than 40 hours in a week, you are probably entitled to “time and a half” overtime pay. But that widely known formula can give way to complexity, as it did in Helix Energy Solutions Group v. Hewitt, a case about whether plaintiff Michael Hewitt is owed overtime pay by his former employer. After parsing detailed regulatory language, a six-justice majority sided with Hewitt; the opinion, authored by Justice Elena Kagan, ultimately turns on the intuitive conclusion that someone who earns a day-rate is not paid on a “salary basis.” READ MORE
The SEC Continues Its Efforts To Improve Option Grant Practices
The SEC’s recent Rule 10b5-1 rulemaking has drawn attention to its efforts to crack down on illegal trading by corporate insiders. (See our related post here.) But less attention has been paid to part of the rulemaking that will likely impact every public company’s option grant practices. READ MORE
Expect Salary Increases To Stall In 2023
For the last few years, wage growth has been on a tear, with average pay in the U.S. up 8.9 percent in 2021 alone—the fastest growth since the early-80s, according to the Social Security Administration.
But now, as the economy slows, that trend is likely to end—fast—especially among executives and middle managers, according to our latest survey of American CEOs. READ MORE
CEO Pay Was Up 21% in 2022. These Are the Most Overpaid CEOs, According to a Shareholder Advocacy Group
The U.S. stock market just had its worst year since the Great Recession, leaving millions of investors with big losses in their 401(k) accounts and portfolios. But there was one group that did quite well during these challenging times: chief executives. READ MORE
The big squeeze: Is pay compression costing you good people?
Over the past few volatile years, the war for talent has meant that companies will often prioritize hiring at any cost. While many have increased salaries for new hires, few gave corresponding increases to current employees—giving rise to a compensation issue called pay compression. Pay compression is what happens when there is little difference between the wages earned by a tenured employee and newcomer, or between a junior- and senior-level employee working within the same job family. If left unchecked, pay compression can lead to higher turnover, lower productivity and the erosion of employee morale and organizational trust. But as we move into an economic downturn, with a greater emphasis on capital efficiency and cost reduction, many companies are encountering a difficult challenge: How can we remediate pay compression problems without an ample budget to give out pay increases? READ MORE