Publication

"Watch Out for the Median! SEC Drives Home Final Pay Ratio Disclosure"


 

On August 5, 2015, the Securities and Exchange Commission (the "SEC") adopted a final rule implementing what the SEC calls the “pay ratio disclosure” requirements, mandated by Section 953(b) of the Dodd-Frank Wall Street Reform and Consumer Protection Act.

This Stroock Special Bulletin provides an overview of the rule, which will require most public companies to disclose the ratio of the compensation earned by the company’s median employee to the compensation earned by a company’s principal executive officer.  Companies must begin reporting pay ratio disclosure for the compensation paid in the first fiscal year beginning on or after January 1, 2017 (for example, a reporting company with a calendar fiscal year will include pay ratio disclosure starting with filings made in 2018).
 
 

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