New York Stock Exchange and Nasdaq Issue Executive Compensation ‘Clawback’ Proposals

The New York Stock Exchange and the Nasdaq Stock Market have issued stock listing rule proposals four months after the SEC published Dodd-Frank clawback rules directing national stock exchanges to require listed public companies to implement policies intended to recoup bonuses paid to executives if the company is found to have misstated its financial results.

The proposals by the two exchanges are very similar but not identical. Perhaps the biggest difference is the explanation about the type of compensation that should be recovered. READ MORE

With IPOs Frozen, Startups Need To Worry About Ticking Options Clock

As the IPO pipeline remains frozen solid, more noise is being made concerning employees options expiring or being extended.

On the day it was reported that payment titan Stripe put a tentative timeline on a long-awaited IPO, news also broke that the company would look to raise billions from private investors. The funds will be used, in part, to help offset a tax bill that will come due when it modifies employees’ stock grants that are set to expire. READ MORE

U.S. DOJ Weighs In on Corporate Compensation and Clawbacks

Deputy Attorney General Lisa Monaco, in a speech at the American Bar Association’s annual National Institute on White Collar Crime, announced a number of updated policies and resource allocations aimed at combatting corporate fraud. The most significant of the announcements related to a new pilot program intended to shift accountability for corporate wrongdoing from shareholders to executives and other personnel identified as responsible for the misconduct. READ MORE

SEC’s Pay vs. Performance Rule Requires Disclosure of Relationship Between Executive Officer Compensation, Company Performance

In accordance with a mandate contained in the 2010 Dodd-Frank Act, on Aug. 25, 2022, the U.S. Securities and Exchange Commission (SEC) adopted a final rule creating Item 402(v) of Regulation S-K, requiring that public companies disclose the relationship between the compensation of their executive officers and company performance. Companies that are not exempt from the rule must comply with the new “Pay versus Performance” (PVP) disclosure requirements in applicable proxy and information statements containing executive compensation disclosure for fiscal years ending on or after Dec. 16, 2022. READ MORE

CFOs are outpacing CEOs when it comes to pay increases

How much of a base salary increase did CEOs and CFOs receive in 2022?

Compensation Advisory Partners (CAP), an executive compensation consulting firm, exclusively shared with Fortune data on salary, bonuses, and equity payouts that provides a sneak peek. The report data is based on 50 cross-industry S&P 1500 companies (with median revenue of $4.6 billion and a median market cap of $7 billion) that have fiscal year ends between Sept. 30 and Nov. 30. READ MORE

SCOTUS Ruling Increases Employer Risk Of Overtime Liability For Day Rate Compensation

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

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

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

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

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