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Does the Ratio of CEO to Employee Pay Really Matter?

8.12.15

Howard Mavity's Workplace Safety and Health Law Blog post "Does the Ratio of CEO to Employee Pay Really Matter? " was picked up by TLNT on August 12, 2015.

The Securities and Exchange Commission recently voted to require employers to disclose the pay gap between the CEO and his or her employees. Unions, investors, and other groups have increasingly been using this disparity to attack companies.

As Fortune magazine calmly pointed out in The Big Flaw in the SEC’s Pay Ratio Rule:

The rule is well intentioned. CEO pay in 2014 was an eye-popping 373 times that of an average worker, according to data compiled by the AFL-CIO, and a sharp rise from 331 times in 2013. This imbalance contributes to America’s growing wealth gap and accompanying social and political inequities. Requiring companies, especially large public corporations, to disclose how richly their CEOs are paid would provide valuable information for shareholders and possibly help the larger national debate about economic fairness.”

The AFL-CIO maintains an elaborate website to check CEO pay titled, “Executive Pay Watch: High Paid CEOs and the Low-Wage Economy.”

To read the full article, please visit TLNT.

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