Due to the popularity of limited liability companies (LLCs) as a form of business entity, we have been approached lately more than ever to structure equity and “phantom” equity based compensation for LLC businesses, including private equity firms and other businesses that embrace an employee ownership culture. Phrases such as “restricted stock”, “stock options” and “stock appreciation rights”, all applicable to corporations, are commonly known. There are, however, equivalent terms applicable to LLCs.
Articles Discussing Executive Compensation.
New Compensation Disclosures for Public Companies
The Securities and Exchange Commission (SEC) has adopted a final rule requiring publicly traded corporations to disclose, to the SEC and shareholders, the ratio of CEO compensation to the “median compensation” of the corporation’s employees (except the CEO).
Tax Alert: New Executive Compensation Regulations Clarify Timing of Taxation
The Internal Revenue Service recently published final regulations under Section 83 of the tax code.
CEO Pay Ratio Disclosure – Eight Things Human Resource Professionals Need to Know Now
On September 18, 2013, the Securities Exchange Commission approved proposed rules (“Proposed Rules”) on calculating the ratio of the chief executive officer’s total annual compensation to the median total annual compensation of all employees, as mandated by section 953(b) of the Dodd-Frank law. Specifically, the Proposed Rules, which span 47 pages of the Federal Register, require proxy disclosure of the median annual total compensation of all employees other than the CEO, and the ratio of that median employee compensation to the CEO’s annual total compensation. The Proposed Rules also request comments from the public on no less than 60 different issues in calculating the CEO pay ratio. While there is significant interest in repealing the CEO pay ratio disclosure requirement, it could become effective for calendar year companies in the 2016 proxy (or sooner for some fiscal year companies). This makes it relevant for pay decisions in 2015 (or sooner, depending on the fiscal year).