Compensation and Benefits

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Special thanks to co-authors Thomas Asmar, Victor Flores, Denise Glagau, Christopher Guldberg, Jen Kirk, Maura Ann McBreen, Lindsay Minnis, Kela Shang, Aimee Soodan and Brian Wydajewski.

As many readers likely know, last fall California doubled-down on the state’s hostility to noncompete agreements. Assembly Bill 1076 codified the landmark 2008 Edward v. Arthur Andersen decision that invalidated all employment noncompetes, including narrowly tailored ones, unless they satisfy a statutory exception.
   
AB 1076 also added new Business & Professions Code §16600.1, requiring California employers to notify current (and certain former) employees that any noncompete agreement or clause to which they may be subject is void (unless it falls within one of the limited statutory exceptions).

Individualized written notice must be sent by February 14, 2024 or significant penalties may apply.Continue Reading Don’t Miss California’s Noncompete Notice Requirement (Deadline 2/14/24) |Review Equity Award Agreements & Other Employment-Related Contracts ASAP

[As reported by our Baker McKenzie Compensation colleagues]

As of December 20, 2017, both the House of Representatives and the Senate have voted to approve the final version of the Tax Cuts and Jobs Act, in substantially the form released by the Conference Committee on December 15th. The bill is expected to be presented to the President for signature before Christmas, making US tax reform a reality for 2018.

What’s In? From a Compensation & Benefits perspective, among other things, the approved bill includes:

  • Significant changes to Code Section 162(m);
  • A new tax deferral regime for options and RSUs granted by private companies;
  • Elimination of exclusion for fewer than expected employer-provided fringe benefits; and
  • Increased disallowance of compensation-related deductions under Code Section 274.

What’s Out? Fortunately, the final bill does not include a Senate proposal to require the use of a first-in-first-out (FIFO) methodology when calculating capital gains on sale of shares, nor does it add back any of the changes to non-qualified deferred compensation that were proposed in the initial House version of the bill. Also, most of the changes proposed to qualified retirement plans have been eliminated.Continue Reading Breaking News! Tax Cuts And Jobs Act Expected To Come Into Effect In 2018

If your plan year coincides with the calendar year, the time to review your commission / bonus compensation plans is NOW.

We’re getting down to the wire. Friendly reminder that if you hope to make changes to 2018 commission / bonus compensation plans, act fast!

Recall that in most jurisdictions OUS, changes to terms and…