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  • Canada’s CEOs couldn’t get much richer, or could they?

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    Tessara Smith, PayScale

    Cats out of the bag – CEO’s make some of the largest salaries of all the employees in Canada’s workforce, and lately it seems that they are raking in an absurd amount of cash. In 2012, the top one hundred CEO’s earned an average of a little more than $7.9 million; each. To put this in perspective, that kind of money has the potential to eliminate the debt of any one of the provinces: Saskatchewan, Manitoba, Newfoundland and Labrador, New Brunswick, Nova Scotia, or Prince Edward Island. 

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  • Comp budgeting: How to identify compensation inequities

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    Tessara Smith, PayScale

    In this first part of our three part email series on Compensation Budgeting, we take a look at compensation inequities. Compensation inequities can occur at an organizational, departmental, positional, or even individual level. To run a successful business and maintain employee satisfaction you have to know how to identify and resolve these inequities. To follow are some things you should be aware of at each level

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  • Keep it moving: Is shorter CEO tenure better?

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    Crystal Spraggins, SPHR

    The 5-year plan

    For decades, the 5-year business plan was touted as a necessary and extremely valuable tool in the well-run organization’s tool belt. A 5-year plan keeps a company on track, by guiding leadership’s decision making about everything from infrastructure to marketing strategy.

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  • Survey reveals what keeps CFOs up at night

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    Crystal Spraggins

    Whether you’re a CFO, report to a CFO, or manage a CFO, you might be interested to know what concerns CFOs.

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  • PayScale Index Q4 2013: the oil and gas industry is hot!

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    Laleh Hassibi, PayScale

    The PayScale Index for Q4 2013 shows an 18 percent rise in Oil and Gas sector wages since 2006; small company wage growth has stalled; annual wage growth of 0.7 percent is predicted for Q1 2014.

    Our first forecast was very close

    Last quarter, we predicted U.S. national wages would grow 0.1 percent between Q3 and Q4 2013. The actual quarterly growth calculated for this Q4 2013 release is 0.2 percent.  We were so close! For Q1 2014, we forecast quarterly wage growth to be a slight uptick of 0.2 percent, resulting in annual wage growth of 0.7 percent.

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  • Compensation Trends in the Insurance Industry

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    Tim Low, PayScale

    I recently gave a presentation along with a colleague to all the attendees of the HR & Finance Summit of the National Association of Mutual Insurance Companies, NAMIC.

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  • CFO Corner: Microsoft's New CFO, Amy Hood, Makes How Much?!

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    Tim Low, PayScale

    Microsoft announced the appointment of their new CFO, Amy Hood, as Seattle Tech Blog Geekwire noted recently. Referring to recent regulatory filings, they also gave a snapshot of her compensation.

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  • Executive Compensation Calendar – When Should You Work on Specific Projects?

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    Dan Walter, Performensation

    It’s that time of the year again. Proxy season is wrapping up. You are probably working at one of the 98% of public companies who passed their Say on Pay vote with flying colors. Or, you work at one of the 100% of private companies that don’t worry about it. Polls and surveys usually show June and July as the slowest months of any compensation professional’s year. This is especially true for those who focus on executive compensation.

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  • Equity Compensation – Performance Accelerated Units (PAUs), Old School Performance Equity


    Dan Walter, Performensation

    As I mentioned in an earlier post, performance equity instruments still get lumped together like a bowl of mixed nuts. Of these instruments, Performance Accelerated Units (PAUs) are one of the easiest for participants to understand. Essentially, they are time-based RSUs with vesting that accelerates if certain goals or triggers are met. It is important to note that PAUs are not strictly pay for performance because value is built in from the start and vesting will occur based on service if the goals are not met. This makes them nearly the polar opposite of the Performance Equity Units (PEUs) were covered in my last equity compensation post.

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  • How to Budget Compensation in a Volatile Economy

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    Laleh Hassibi, PayScale

    At the end of 2012, most businesses were very optimistic about job and economic growth in 2013. The trends from Q4 and early Q1 supported the fact that we were in fact rebounding quite nicely from the recent economic recession. There was a small worry that the impending doom of sequestration would occur, but most business leaders skipped optimistically into 2013 with confidence that Congress would come to an agreement, thereby avoiding indiscriminate, across-the-board spending cuts.

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  • Real Pay, Realizable Pay, Pay Ratios and Reality


    Dan Walter, Performensation

    Pay ratios are the most commonly used tool when discussing the unfairness between executive pay and that of the rank and file. Recently, on the PayScale Career News blog which caters to individuals managing their careers, there was an article showing CEO-worker pay ratios at several well-known companies. Ratios like 1,034:1 (Walmart) and 0:1 (Google) are attention grabbers. The question is whether this tells all, or even a significant portion, of the real story.

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  • CFO Corner: Is Your Economic Glass Half-full or Half-empty?

    Pig half full
    Evan Rodd, PayScale

    PayScale’s 2013 Compensation Best Practices Report showed some of the most positive figures we’ve seen in some time. Wages are up across the board for companies of all sizes, and many organizations are beginning to hire for various positions — news which is undoubtedly exciting for job seekers. Those who are currently employed were also given a reason to smile, as 85 percent of companies expect to issue raises in the coming months.

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  • Equity Compensation – Restricted Stock Units (RSUs), Downside Protection with a Couple Downsides

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    Dan Walter, Performensation

    Last month I covered Restricted Stock Shares (RSS), today’s post covers Restricted Stock Units (RSUs). Where RSS and Stock Options are cousins, RSS and RSUs are siblings. RSS is the older sibling, with more years and experience under its belt. RSUs are the new little sister who came by surprise and often gets more attention than seems to be required. RSUs were seldom used before they shot into the spotlight following the Dotcom crash of 1999-2000. Initially, they were used to replace underwater stock options and slow the use of plan shares approved by shareholders. They provided some protection against a decrease in stock price and used somewhere between 25-50% of the shares require to provide the same value as stock options. They quickly became a major component of the equity compensation toolbox.

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  • The Seven Deadly Sins of Executive Compensation

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    Dan Walter, Performensation

    Most of the problems with executive compensation tend to originate within a few categories. I have attempted to summarize these and look forward to the compensation community adding their take on this topic. Look at your past mistakes and issues. Did they start with one of these seven categorical errors?

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  • Equity Compensation – Restricted Stock Shares, Always a Great Tool, Sometimes

    Stickman - Equity Compensation - RSS
    Dan Walter, Performensation

    Restricted Stock Shares (RSS), often called Restricted Stock Awards (RSA) or even more simply Restricted Stock, have been used longer than any other equity compensation instrument. Companies have used variations of restricted stock for almost as long as stock has existed. While ISOs and NQSOs are “appreciation only” awards, RSSs are Full Value Awards (FVA). RSS awards are unique in that they require the issuance of real stock as of the date of the award. Restricted Stock is a confusing term since it can refer to at least three major categories of stock. 1) Stock issued prior to registration with the SEC under the 1933 Act; 2) Stock issued to affiliates of the company who are subject to Rule 144 filings; 3) Stock that must meet time and/or performance conditions before it can be freely transferred. For the sake of this post, I will only cover the last of these.

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  • CFO Corner: What the Heck is Realizable Pay (and why you need to know…now)

    Stickman - Realizable Pay
    Dan Walter, Performensation

    In the good old days, determining total compensation was fairly easy. Always wrong, but easy. For any given year you just added up what you paid people in base pay, what you expected to pay them in bonuses, other cash incentives, and the Fair Value (or a reasonable equivalent) of equity at the time it was granted. Public companies disclosed this information and shareholders were left to make their own projections from there. There has been a fairly rapid movement to a measurement called “realizable pay” (the current/recent value of outstanding pay). This metric may also be combined with “realized pay” (the value of exercised or otherwise delivered pay) in an attempt to provide a more accurate picture of total compensation and its alignment to company performance.

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  • CFO Corner – Non-Qualified Stock Options Are Much Better Than They Sound

    Stickman - NQSOS are better than they sound
    Dan Walter, Performensation

    Non-Qualified Stock Options (NQSOs, NQs, NSOs) should really be called Stock Options. Non-qualified (or non-statutory) makes them sound negative. The negative modifier simply refers to the fact that these stock options have no special section dedicated to them in the IRS tax code. Like Incentive Stock Options (ISOs), NQSOs are generally appreciation-only instruments. Unlike like ISOs, if the plan and local rules allow, they can be granted at price less than Fair Market Value (FMV). Although ISOs get most of the press, NQSOs are more commonly granted.

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  • CFO Corner: UK Shareholder Spring was Barely a Fling

    Stickman UK Shareholder Spring

    Dan Walter, Performensation

    In recent presentations I have heard several compensation professionals from the UK refer to their “Shareholder Spring” of 2012. The reference is to the raising of voices from shareholders. While we all love a little hyperbole, I believe that their Shareholder Spring was barely a fling. The UK’s Shareholder Spring led to a lot of posturing, but as of yet, the player and rules of the game are still familiar.

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  • CFO Corner: Equity Compensation – The Ups and Downs of ISOs

    Stickman ups and downs of isos
    Incentive Stock Options are a great place to start talking about equity compensation. ISOs are “appreciation-only” vehicles, meaning they have direct value to employees only if the stock price appreciates above the initial grant price. Other common appreciation-only instruments include NQSOs and SARs (to be covered in future posts). If you understand ISOs, you can easily understand other appreciation instruments.

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  • CFO Corner: The 2013 Meaning Of Unemployment

    Although President Barack Obama has been re-elected, our country continues to be divided amid our economic recovery and job growth. With a 7.9 percent unemployment rate in October, Obama is tackling the highest jobless rate of any president in the postwar era.

    However, things do seem to be looking up in the 2013 unemployment forecast. The Labor Department recently reported the nation added 171,000 positions on net in October, with more jobs than initially estimated in August and September. According to the New York Times, economists are hopeful that post-election policies in Congress will address fiscal tightening that may increase job and output growth.

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