Special thanks to co-author, Jeff Bauman.
It is common practice for US-based multinational companies to adopt executive severance plans to provide for additional benefits to be paid to executives in the event of certain specified termination events, including those in connection with the change of control of the parent. These benefits may consist of
The New York City Council is already considering an expansion to the City’s pay transparency law to require NYC employers to include a description of non-salary or non-wage compensation in job postings. Dramatically increasing the burden on employers, the proposed ordinance would require a description of “bonuses, benefits, stocks, bonds, options and equity or ownership, if any.”
Background
As discussed here, New York City’s pay transparency law (Local Law 32 and its amendment), went into effect on November 1, 2022, and requires NYC employers with four or more employees to disclose in job postings – including those for promotion or transfer opportunities – the minimum and maximum salary offered for any position located within New York City. This range may extend from the lowest to the highest salary that the employer in good faith believes at the time of the posting it would pay for the advertised job, promotion, or transfer opportunity.
Update
On February 2, 2023, the Council introduced Int. No. 907, a local law to amend the administrative code of the city of New York, broadening the information that must be disclosed in job postings.Continue Reading Proposed Expansion of NYC’s Pay Transparency Law Includes Bonuses, Equity Awards and Other “Non-Wage Compensation”
Special thanks to Geoff Martin and Maria Piontkovska.
On March 3, 2023, the Criminal Division of the United States Department of Justice (“DOJ”) published details of a three year Pilot Program Regarding Compensation Incentives and Clawbacks (the “Compensation Pilot Program”). The Compensation Pilot Program is effective March 15, 2023 and from that date it will be applicable to all corporate criminal matters handled by the DOJ Criminal Division. At the same time, DOJ also updated its Evaluation of Corporate Compliance Programs guidance document to reflect the criteria introduced by the Compensation Pilot Program, among other updates.
Background and Objectives of the Compensation Pilot Program
The concept of incentivizing corporate compliance by structuring compensation programs to reward compliant behaviors and punish non-compliant ones, is nothing new. For example, prior editions of the Evaluation of Corporate Compliance Programs addressed appropriate incentives for company management and executives to promote good governance and compliance, and expectations about the consistent application of discipline against employees found to be involved in misconduct.
However, in a September 2022 memo to DOJ prosecutors titled: “Further Revisions to Corporate Criminal Enforcement Policies Following Discussions with Corporate Crime Advisory Group“, Deputy Attorney General Lisa Monaco indicated that DOJ intended to go further on this particular topic. In the memo, Monaco indicated that DOJ would expect companies to design compensation structures not only to incentivize and reward good compliance practices, but also to financially penalize individual employees found to have been engaged in misconduct, including by clawing back compensation after the fact.
DOJ’s objective in this initiative is to encourage companies to redistribute some of the cost and penalties associated with individuals’ criminal conduct away from the company (and its shareholders) and onto the individuals themselves. Because misconduct is often discovered after the fact, measures that enable retroactive discipline and clawback of compensation already paid, are of particular importance to DOJ. These measures also reinforce DOJ’s continued focus on individual accountability which has been another of DOJ’s recent areas of focus in addressing corporate criminal matters.
Six months after Monaco’s memo, the Compensation Pilot Program now puts concrete DOJ policy in place to implement those objectives. At the end of the three year pilot period, DOJ will determine whether the Compensation Pilot Program will be extended or modified. If it is deemed a success, we can expect the Compensation Pilot Program to be fully adopted by DOJ. Continue Reading Practical Considerations When Addressing New DOJ Compensation Incentives and Clawbacks Program
Together we navigated operational challenges caused by the pandemic, and together we will weather this. What follows is information and practical advice for employers concerned with satisfying their payroll obligations in the near term in the face of their bank falling into receivership.
Continue Reading Navigating Fallout From a Bank Receivership | Practical Tips for US Employers
Studies are showing that around 98% of CEOs in the US and across the EU are preparing for a recession in the next 12-18 months.
With inflation increasing the cost of goods and certain services, some companies may find themselves in an immediate economic bind and needing to engage in cost-cutting methods to reorganize and
It is official. California has joined Colorado, Washington and New York City in requiring job posting to include pay ranges. Today (September 27, 2022), Governor Newsom signed SB 1162 into law, requiring California employers with 15 or more employees to include the salary or hourly wage range of positions in job listings. SB 1162 also
As we pass the 2.5 year mark since many of us were sent to work from home for “two or three weeks” in early 2020, a number of employers are getting closer to having formal policies to address remote work and hybrid work arrangements. One of the more enduring consequences of the pandemic for employers
Employers in New York State may soon be required to disclose a salary range in job postings to applicants and employees. New York’s S9427 was just sent to Governor Kathy Hochul’s desk, and if signed, employers in New York State will join employers in New York City (read more here), Colorado (read more here
We are pleased to share a recent Life Annuity Specialist article, “Why Insurers May Worry About New York’s Salary Transparency Law,” with quotes from Robin Samuel. This article discusses the likely impact of New York City’s new salary transparency law on insurers, other employers and job postings in New York City.
Click here to continue
With special thanks to our colleagues in Mexico: Javiera Medina-Reza, Liliana Hernandez-Salgado and Salvador Pasquel-Villegas.
In May, employers in Mexico will encounter new rules regarding compulsory company profit sharing entitlements for employees. This labor reform requires the immediate attention of companies doing business in Mexico.
In this video, Baker McKenzie’s Labor and Employment
