Perception Is Everything: The Path to Pay Confidence

Your employees’ views on the fairness of their pay may stem from much more than the number they see on their paychecks.

According to a 2025 Fair Pay Impact ReportOpen in a new tab by compensation software and data company Payscale, 68% of surveyed workers believe they’re underpaid — even when they’re paid at or above market rates. Among workers paid directly at the market rate, 63% think they’re paid below market; but even among employees making above market, 47% have the same belief. Payscale analyzed data from more than 325,000 respondents in an online salary survey taken between Jan. 1, 2021, and Jan. 1, 2025. READ MORE

Gallagher Predicts ‘Moderate’ Approach to 2026 Salary Increase Budgets

In response to fluctuating economic conditions, a cooling labor market, and growing expectations around pay equity and transparency, U.S. employers are taking a moderate approach toward their 2026 salary increase budgets, according to a new report from Gallagher.

The risk management and consulting firm’s “2025/2026 Salary Planning Report” revealed participating organizations are forecasting fiscal year 2026 average total pay increases of: READ MORE

The Overlooked Elements of Executive Pay: Perquisites, Retirement and Severance

While perquisites, retirement and severance are not ordinarily an annual focus of Compensation Committees, these non-core elements can play a critical role in crafting executive compensation programs that enable companies to achieve their strategic goals and objectives. This issue of the Beacon looks at these non-core elements, outlines important committee considerations and highlights the questions committees should ask when evaluating these non-core elements.

When people think of executive compensation, they naturally think of salaries, annual bonuses, and long-term incentives. While these are the foundational elements of pay that predominantly occupy Compensation Committees’ time and attention. The non-core elements play a material role in retention, motivation and governance. READ MORE

Employers Balance State Pay Equity Laws With Trump Anti-DEI Push

Businesses are weighing competing pay equity legal risks, as the Trump administration scrutinizes DEI efforts while states advance wage transparency laws that increasingly threaten to expose disparities.

Laws requiring companies to include salary ranges in job ads recently took effect in New Jersey and Vermont and will be implemented in Massachusetts in October. A Delaware bill awaiting the governor’s signature is also set to imitate transparency mandates that have in recent years spread from California to New York. READ MORE

Here’s What Employers Need to Know as DOL Reinstates Back Wage Payment Option

The US Department of Labor’s latest update rewards employers that proactively resolve potential wage and hour claims and obtain approval of their investigation and resolution. The DOL’s Wage and Hour Division first introduced the Payroll Audit Independent Determination (PAID) Program in 2018, but it was shut down in 2021. Yesterday’s news that the program has now officially returned follows several other big changes from the DOL: the reboot last month of the opinion letter program, a general reduction in WHD staffing levels, and an announcement earlier this month that it would not seek liquidated damages in pre-litigation settlements. The PAID program’s revival highlights the value of employer self-audits and proactive handling of potential wage claims. Here’s what you need to know about it and how it might benefit your organization. READ MORE

As 2026 salary budgets remain flat, how employers are ‘rethinking’ value propositions

With cost containment a looming influence, new research finds that when it comes to salary increase budgets for 2026, few organizations are planning any big changes.

WTW’s most recent Salary Budget Planning Report uncovered that the average salary increase budgets for U.S. companies are expected to remain flat next year at 3.5%, the same as the actual budgets of 2025. READ MORE

SEC Hosts Compensation Disclosure Roundtable in Advance of Potential Rule Changes

On June 26, 2026, the Securities and Exchange Commission (“SEC”) hosted a roundtable to discuss whether executive compensation disclosure rules produce information material to investors and if not, how they should be amended. The roundtable consisted of representatives from public companies and investors, as well as other experts in this field. Remarks were made by SEC Chair Paul S. Atkins and the other sitting commissioners. A recording of the roundtable is available on the SEC’s website here. Chair Atkins noted in his remarks that one might describe the SEC’s current compensation disclosure requirements as a “Frankenstein patchwork of rules.” He suggested that the compensation disclosure rules have become unwieldy, are not cost-effective and result in disclosure that a reasonable investor struggles to understand. Commissioners Hester Peirce and Mark Uyeda echoed his views. We expect that the SEC will issue one or more rule proposals amending executive compensation disclosure requirements, possibly later this year. READ MORE

A new era of restaurant workers may earn six-figure salaries and benefits that 'no other industry' can provide

Waiting tables or serving up food in the drive-thru may seem like a first step into the workforce – but for some it could pave the path that leads to a big-money job.

Amid a nationwide restaurant worker shortage, many brands are finding ways to attract and retain their employees while offering big bucks and benefits to those who wish to work long-term or climb the ladder. READ MORE

How the OBBBA affects tax treatment of compensation and benefits

The One Big Beautiful Bill Act (OBBBA) changes the tax treatment of compensation and benefits in several ways that have major implications for employers. Employers may face modified tax obligations, new reporting requirements, and challenges implementing new processes and rules. The changes will require employers to evaluate and adapt their compensation and benefits programs and administrative practices. READ MORE

SEC Signals Potential Shift in Disclosure Requirements

Executive compensation disclosure requirements were the primary topic of the June 26, 2025 SEC roundtable, with particular focus on the CEO pay ratio and pay-versus-performance disclosure rules and perquisites. Several SEC Commissioners shared their perspectives on the current executive compensation disclosure framework during the event. Chairman Paul Atkins, who assumed office in April, compared the existing framework to “Frankenstein’s monster,” a patchwork of well-intentioned requirements that has evolved into something far removed from its original purpose. Commissioners Hester Peirce and Mark Uyeda noted the significant compliance burden that the current rules impose on companies and questioned whether this disclosure serves the Commission’s mission of investor protection. Continued evaluation is likely to result in proposed rulemaking in this area, with elimination or streamlining of existing executive compensation rules. READ MORE

Court Strikes Down Morgan Stanley Appeal in Deferred Compensation Class Action Lawsuit

A federal appeals court shot down Morgan Stanley’s attempt to appeal a lower court’s decision that its deferred compensation plans were protected by federal law. The decision could impact numerous arbitration proceedings filed against the wirehouse by former employees.

The Second Circuit Court of Appeals issued its dismissal of Morgan Stanley’s appeal, arguing it didn’t have proper jurisdiction, and denied Morgan Stanley’s request that the district court judge who filed the previous opinion “strike its legal conclusion that the deferred-compensation plans” fell under the Employee Retirement Income Security Act. READ MORE

Comparing pay for Microsoft's boss and the company's workers

Last week, Microsoft eliminated 9,000 jobs—laying off 4% of its workforce (and a big chunk of its gaming team)—despite having reported nearly $26 billion in net income in the first three months of 2025.

Massive profits may not preclude a company from cutting jobs. Perhaps they know of some weakness to their business that necessitates eliminating the jobs of scores of experienced professionals. READ MORE

SEC Signals Coming Changes to Executive Compensation Disclosure

On June 26, 2025, the Securities and Exchange Commission (SEC) hosted a roundtable on executive compensation disclosure requirements with representatives from public companies, investors, industry groups and advisors. In his introductory remarks, SEC Chair Paul Atkins referred to the current disclosure requirements as a “Frankenstein patchwork of rules,” a refrain echoed by Commissioners Hester Peirce and Mark Uyeda, each of whom signaled an interest in clarifying certain rules and simplifying current executive compensation disclosure. READ MORE

Senate Tax Package Includes Major Changes to Endowment and Executive Compensation Excise Taxes

On July 1, the Senate approved its version of “The One Big Beautiful Bill Act,” containing several provisions relevant to tax-exempt organizations. Importantly, certain proposed amendments contained in draft legislation released by the Senate Finance Committee two weeks ago (covered in our prior Alert here) were removed from the approved bill following a determination by the Senate Parliamentarian that those provisions were outside the scope of what could be approved by the Senate under the reconciliation procedure. The Senate-approved legislation is substantially different from that approved by the House last month (covered in our prior Alerts here and here). The House must now approve the Senate’s version, or the two chambers must work to reconcile those differences, before the legislation can be sent to the President for signature. READ MORE

AI can help benefit leaders with the compensation process

Determining salaries is one of the most critical pieces to attracting and retaining talent, and technology may have the potential to improve the decision process significantly for benefit managers and employees.  

Over 70% of U.S. companies use AI in some capacity, including compensation decision making, according to business networking platform Connex Partners. While benefit managers may feel uncomfortable relying on automation for something as complex and sensitive as deciding salaries, it has the potential to drastically improve the process for them, as well as current and prospective employees.  READ MORE