In this blog, Allen Matkin’s Keith Bishop gives us the updated news about the Dennis v. Hart case since a panel of the California Court of Appeal recently affirmed that case’s dismissal. Here’s the appeal court’s opinion.
As Keith notes, some may be surprised that this case, which involves a Delaware corporation, was in the California courts of all, but the Ninth Circuit has held that the Dodd-Frank Act’s say-on-pay mandate did not by itself confer jurisdiction on the federal courts…
Our conference finally ended yesterday and I’m now digging out. Here are what others have said about the debate over the SEC’s pay disparity disclosure proposal:
Today is the “Say-on-Pay Workshop: 10th Annual Executive Compensation Conference”; yesterday was the “Annual Proxy Disclosure Conference” – and the video archive of that Conference is already posted. Note you can still register to watch online by using your credit card and getting an ID/pw kicked out automatically to you without having to interface with our staff. Both Conferences are paired together; two Conferences for the price of one.
– How to Attend by Video Webcast: If you are registered to attend online, just go to the home page of TheCorporateCounsel.net or CompensationStandards.com to watch it live or by archive (note that it will take about a day to post the video archives after it’s shown live). A prominent link called “Enter the Conference Here” – on the home pages of those sites – will take you directly to today’s Conference (and on the top of that Conference page, you will select a link matching the video player on your computer: Windows Media or Flash Player). Here are the “Course Materials,” filled with talking points and practice pointers.
Remember to use the ID and password that you received for the Conferences (which may not be your normal ID/password for TheCorporateCounsel.net or CompensationStandards.com). If you are experiencing technical problems, follow these webcast troubleshooting tips. Here is today’s conference agenda; times are Eastern.
– How to Earn CLE Online: Please read these FAQs about Earning CLE carefully to see if that is possible for you to earn CLE for watching online – and if so, how to accomplish that. Remember you will first need to input your bar number(s) and that you will need to click on the periodic “prompts” all throughout each Conference to earn credit. Both Conferences will be available for CLE credit in all states except for a few – but hours for each state vary; see the CLE list for each Conference in the FAQs.
Today is the “Tackling Your 2014 Compensation Disclosures: The Annual Proxy Disclosure Conference”; tomorrow is the “Say-on-Pay Workshop: 10th Annual Executive Compensation Conference.” Note you can still register to watch online by using your credit card and getting an ID/pw kicked out automatically to you without having to interface with our staff. Both Conferences are paired together; two Conferences for the price of one.
– How to Attend by Video Webcast: If you are registered to attend online, just go to the home page of TheCorporateCounsel.net or CompensationStandards.com to watch it live or by archive (note that it will take about a day to post the video archives after it’s shown live). A prominent link called “Enter the Conference Here” – on the home pages of those sites – will take you directly to today’s Conference (and on the top of that Conference page, you will select a link matching the video player on your computer: Windows Media or Flash Player). Here are the “Course Materials,” filled with talking points and practice pointers.
Remember to use the ID and password that you received for the Conferences (which may not be your normal ID/password for TheCorporateCounsel.net or CompensationStandards.com). If you are experiencing technical problems, follow these webcast troubleshooting tips. Here is today’s conference agenda; times are Eastern.
– How to Earn CLE Online: Please read these FAQs about Earning CLE carefully to see if that is possible for you to earn CLE for watching online – and if so, how to accomplish that. Remember you will first need to input your bar number(s) and that you will need to click on the periodic “prompts” all throughout each Conference to earn credit. Both Conferences will be available for CLE credit in all states except for a few – but hours for each state vary; see the CLE list for each Conference in the FAQs.
For the many of you that have registered for our Conferences coming up on Monday, we have posted the Course Materials (attendees received a special ID/PW this week via email that will enable you to access them; note that copies will be available in DC). The Course Materials are better than ever before – with over 40 sets of talking points comprising 140 pages of practical guidance. We don’t serve typical conference fare (ie. regurgitated memos and rule releases); our conference materials consist of originally crafted practical bullets and examples. Our expert speakers certainly have gone the extra mile this year!
For those seeking CLE credit, here’s a list of states in which credit is available for watching the Conferences live in DC and by video webcast.
– How to Attend by Video Webcast: If you are registered to attend online, just go on Monday to the home page of TheCorporateCounsel.net or CompensationStandards.com to watch it live or by archive (note that it will take about a day to post the video archives after it’s shown live). A prominent link called “Enter the Conference Here” – that will be on the home pages of those sites – will take you directly to Conference. Remember to use the ID and password that you received for the Conferences (which may not be your normal ID/password for TheCorporateCounsel.net or CompensationStandards.com). Here is the conference agenda; times are Eastern.
– Register Now – There is still time to register for our upcoming pair of executive pay conferences – which starts on Monday, September 23rd – to hear what Keith Higgins, the Director for the Division of Corporation Finance, says about the proposed pay ratio rules, as well as catch a “how to implement pay disparity rules” workshop that is part of the last panel on Tuesday, September 24th. If you can’t make it to Washington DC to catch the program in person, you can still watch it by video webcast, either live or by archive. Register now.
– Registration for Attendance in DC – Walk-Ups Only: Going forward, you are no longer be able to register to attend in Washington through this site (however, you still will be capable of registering online to watch by video at any time). You can still register to attend in DC – you just need to bring payment with you to the conference and register in-person.
As I blogged yesterday, the SEC – by a 3-2 vote – held an open Commission meeting in which it proposed pay ratio rules. There’s a 60-day comment period. The proposing release specifically says there’s a transition period once final rules are adopted, allowing companies to “omit” the first year. So if the rules become effective in 2014 (which is the most realistic timeframe), then you are first required to comply in the 2016 proxy season with 2015 fiscal year information.
The proposing release is fairly open-ended – so it’ll be interesting to see if that makes folks happier or uncomfortable. Flexibility is the name of the game since what you can do – which you can’t do with NEO comp – is use reasonable estimates to come up with the 402 number for the “median employee” (although there won’t be much to calculate for the median employee at most companies since they don’t get paid a dozen different ways like many CEOs). Have it your way! For the statistical sampling section, drop by your friendly statistician to understand it. But that should not be much of a challenge as companies conduct statistical sampling for a whole host of issues.
I’m posting memos in the “Pay Disparity” Practice Area – but just in case you wanted the “bullet overview” from Johnson & Johnson’s Doug Chia:
1. Proposed rules are designed to provide “significant flexibility” to companies
2. No prescribed methodology for calculating/identifying median employee
3. Companies can use the methodology that best suits its particular circumstances
4. “Statistical sampling” could be one such methodology (i.e., company could use a sample of its employee population for purposes of finding the median)
5. Companies may identify median employee based on any “consistently applied compensation measure” (e.g., wages, overtime amounts recorded in tax filings) and then apply Rule 402 to calculate the total compensation for that employee
6. Companies can use reasonable estimates to calculate total compensation for the median employee
7. Companies must include full-time, part-time, seasonal, and international employees as of the last day of the fiscal year
8. Companies will be permitted to annualize compensation of full-time employees who did not work for the whole year
9. Companies will not be permitted to annualize temporary or seasonal employees
10. Estimates and assumptions must be disclosed
11. Ratio must be disclosed in filings that require executive compensation disclosures (e.g., Form 10-K/proxy statements, registration statements)
12. Disclosure must be provided no later than 120 days after end of fiscal year
– What This Means – There is still time to register for our upcoming pair of executive pay conferences – which starts next Monday, September 23rd – to hear what Keith Higgins, the Director for the Division of Corporation Finance, says about these proposed rules, as well as catch a “how to implement pay disparity rules” workshop that is part of the last panel on Tuesday, September 24th. If you can’t make it to Washington DC to catch the program in person, you can still watch it by video webcast, either live or by archive. Register now.
Registration for Attendance in DC – Walk-Ups Only After 9/19: Starting at 8 pm eastern tonight, you will no longer be able to register to attend in Washington through this site (however, you still will be capable of registering online to watch by video at any time). After this cutoff, you can still register to attend in DC – you just need to bring payment with you to the conference and register in-person.
The SEC just wrapped up an open Commission meeting in which it proposed pay ratio rules by a 3-2 vote. The proposed rule doesn’t specify any required calculation methodologies for identifying the median employee in terms of total compensation for all employees – so companies would have flexibility (eg. can use statistical sampling) – and companies would then disclose their methodology.
The methodology would cover “all employees,” which is defined to include full-time, part-time, temporary, seasonal and non-U.S. employees – counted as of the last day of the company’s fiscal year (and include those employed at subsidiaries). No press release or proposing release yet. With a 60-day comment period – and a transition period noted in the proposing release – it looks likely that final rules would apply for the for the spring ’16 proxy season using ’15 fiscal year information. I’ll blog more details tomorrow…
– What This Means – There is still time to register for our upcoming pair of executive pay conferences – which starts next Monday, September 23rd – to hear what Keith Higgins, the Director for the Division of Corporation Finance says about these proposed rules, as well as catch a “how to implement pay disparity rules” workshop that is part of the last panel on Tuesday, September 24th.
If you can’t make it to Washington DC to catch the program in person, you can still watch it by video webcast, either live or by archive. Register now.
Since the SEC will be meeting tomorrow to consider proposing the long-awaited – and feared – pay disparity rules, we have expanded Corp Fin Director Keith Higgins’ keynote on Monday during our “Proxy Disclosure Conference” so that there will be ample time to discuss this new proposal as well as many other topics related to proxy disclosures. Register now.