During the two years following the SEC’s publication of final rules that require that companies satisfy the pay ratio disclosure requirements of the Dodd-Frank Wall Street Reform and Consumer Protection Act beginning in 2018 proxy statements, many public companies, hoping for a repeal or delay in the implementation of the rules, have waited to take the significant preparatory steps necessary for compliance.  As there has been no reprieve in the deadline — the pay ratio is still required to be disclosed in 2018 proxy statements — the time for procrastination has ended, and public company clients need to take immediate steps to ensure compliance in 2018.

Briefly, the pay ratio disclosure contained in Item 402(u) of Regulation S-K requires public companies to disclose:

  • The median of the annual total compensation of all employees of such public company other than the CEO;
  • The annual total compensation of the CEO; and
  • The ratio of those two amounts.


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