Notable Developments as of 2021.04.02
2021.04.02 Project Completion Plan not under ERISA - Employer Loses. It was a close call. The employer argued for ERISA preemption in order to foreclose former employees from asserting a wide range of possible claims in state court. The 5th Circuit decided against the employer because ... continued atSeverance Plan Litigation.
2020.09.11 National Pension Award to Fund Local Social Justice Awards. These two are linked thanks to this recently-announced ACEBC award. If you are interested in (1) hearing about a possible change to ERISA to enable retirees to convert their account balances into cost-efficient annuities, or (2) supporting social justice awards planned in 2020 for Washington (DC), Annapolis (MD), and Charleston (SC), please visit this page.
2020.07.15 "Getting Severance Right" begins with the following advice that makes this Bloomberg article worth reading: "Some employers think it is safest to follow informal, unwritten practices and to avoid the federal labor law known as ERISA. They should read on." For topically-organized information about severance plans and practices, see Severance.
2020.05.28 Executive Comp - Red Flag for Shareholder Litigation... Shareholder derivative litigation involving Skechers has settled, with $20 million of its past executive stock awards being cancelled. The settlement includes a commitment to have the compensation committee consider input from a compensation consultant. For what got the company in hot water, see Compensation Committee Governance.
2020.05.09 Smart Structures for Executive Compensation: The More Things Change ... It's been 15 years since I wrote an article that began: "the decision-making environment is right for awards that are formula driven, that vest based on future performance, and that impose postemployment risks of forfeiture for disloyal actions, such as joining a competitor or soliciting customers or employees." Rolling that forward to today, the best employers are taking one further step ... continued at Executive Compensation - Governance.
2020.05.01 Adjusting Performance Goals - Wrestling One Impediment. What if a company has established performance goals for annual bonuses or longer-term awards, and the underlying plan does not authorize a change in those goals? That is a question that is arising with some frequency. And here are some answers.
2020.04.28. New LTIP, Severance and Change in Control Survey Data. Not surprisingly, between 2x and 3x pay is the range for CEO severance in just over 80% of the top 200 public companies. Likewise, those multiples apply in 84% of the surveyed companies to ... new reports at LTIP Data, Severance Surveys and CIC Surveys. See generally: Topical Index for Executive Comp. Survey Data.
2020.02.28 Take Warning: Tax Exempt Orgs. This is happening too often. A valued executive gets ready to retire from a charity or other tax exempt organization, and is promised some form of severance or retirement benefit that will be paid for months or years afterward. Because the payout involves a fixed payout schedule, no one expects a tax disaster. For why they could be wrong, go to 457(f) Disasters.
2020.01.14 Executive Compensation Strategies for Volatile Economic Times. See this Law360 article for 8 planning alternatives that public and private companies should consider.
2019.12.14 Bonuses and Vesting - Good Faith and Fair Dealing. Principles of fairness generally entitle executives and other employees to collect bonuses and other performance-based compensation if applicable goals have been satisfied, as well as if . . . continued at Cash Bonus Litigation.
2019.04.18 Rabbi Trusts: When to Ask? What to Get? A recent Law360 headline brings rabbi trusts immediately to mind. It reads "Ex-Manufacturing Co. CEO Says He's Owed $4.4M in Benefits" (4/10/2019). See this webpage for a discussion of how a rabbi trust could have helped, and when the protections of a rabbi trust make sense for an executive to pursue.
Notable Updates in 2020:
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