ExecutiveLoyalty.org

   Executive Compensation   Loyalty  Business Issues

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  This site provides general information for educational purposes, is not intended either to provide legal advice or to be relied upon in any way.  There is no substitute for personal legal counsel about your particular situation. This site is not affiliated with any law firm, and merely provides the views of Mark Poerio in his individual capacity.

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Notable Developments as of 2018.07.13


2018.07.12   Executive Misconduct - Clawback and Other Remedies.  Law360 just released this article about an oil company that is pursuing just the kind of remedies that David Gabor and I will be discuss during our August 28th webinar titled "Tightening-up Executive Compensation: Five Steps for Defusing Litigation Risks and Better Enforcing Restrictive Covenants". Whether in employment agreements, plans, or awards, it makes sense for employers to condition executive compensation on proper workplace conduct and the honoring of loyalty-related covenants such as those relating to fiduciary duties, non-competition, and the protection of trade secrets. See generally, Checklist: Precautions against Benefit Plan Litigation.


2018.07.11   Diversification from Employer Stock: Not Always a Bad Practice.  It is generally considered a best practice to assure that executives hold significant equity stakes in employer stock, in order to align their personal financial interests with those of shareholders. Nevertheless, too much employer stock could backfire under certain situations that make employer-sponsored diversification programs sensible to consider . . . Continued at Diversification from Employer Stock (with links to recent articles on this topic).  

 

2018.06.18  Deal-Breaking M&A Issues from Benefit Plans and Executive Compensation.  Merger and acquisition transactions will seldom break-apart due to issues related to employee benefit plans and executive compensation.  But seriously disruptive issues may arise, and are most likely to explode, when overlooked until the last minute. For a list of material issues to consider, continue reading here


2018.06.05  Moving the Bonus Plan Goalposts - Be Smart or Be Sued.  Whenever a company announces performance goals that apply to cash bonus, equity award, or vesting conditions, there is some risk that affected employees will later question the end-of-period determinations. Well-drafted plans and programs include significant employer protections. But some defects can haunt, such as the failure to address the impact of a future merger or acquisition, or the omission of a maximum limit.  Panera Bread tried to recover from the latter, but lost in the 8th Circuit because . . . continued at Litigation - Bonuses


2018.05.14  ISS Problematic Pay Practices - Updated. On at least an annual basis, those who make executive compensation decisions for public companies should check their practices against the guidelines published by ISS and other proxy advisory firms.  See this table for a checklist that generally tracks, the U.S. Compensation Policy FAQs that ISS most recently updated on December 14, 2017. 


2018.05.13  Medical Powers of Attorney and Estate Planning.  This Investors Business Daily article is worth reading for smart reasons to get out in front of estate planning - especially for signing a medical power of attorney. Maryland provides a straightforward form, and it is thought-provoking to consider the choices. Glad to share more info via email.


2018.05.08  Checklist for Improving Release Agreements.  There is nothing worse for an employer than paying money to settle claims, and then finding that its claims release is invalid - or is resulting in further litigation.  See this page for provisions by which employers may avoid having their claims releases backfire.


2018.04.07  Voluntary Severance Plan - Fidelity's Experience. What happens when 3,000 employees over age 55 receive a buy-out offer because they have more than 10 years of experience?  Fidelity made that offer, and its results do not surprise because . . .  continued at  Voluntary Severance Plans, with a discussion of how those buy-out plans can work - and backfire.​​


2018.02.07  "The Front Line in the War Against Sexual Harassment" explains why "For employers who agree that bad acts should have bad consequences, 2018 will be a good year in which to revisit what is placed at risk, and how that risk will materialize."  Further discussed at  Dismissals for Cause.

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