Firms Face New Curbs on Pay

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Published in The Wall Street Journal December 10, 2009 by Deborah Solomon, Sara Schaefer, and Alistar MacDonald

Authorities on both sides of the Atlantic are moving to enact tough curbs on pay, in an indication that governments are taking increasingly aggressive steps to rein in compensation after the financial crisis.
In the U.S., the Treasury Department’s pay czar, Kenneth Feinberg, is poised to enact tougher-than-expected rules for employees at companies that received large amounts of government assistance. The U.K. on Wednesday slapped banks with a 50% tax on portions of bonuses they pay to individuals, in perhaps the most aggressive move yet by a government.
Mr. Feinberg has already capped salaries of top employees under his review. Now, according to government and company officials, he’s going after the next tier and is expected to impose $500,000 salary caps on hundreds of employees at the companies.

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