Corporate Bonuses

News & Analysis as of

Senator Warren Leads Coalition to Expand Scope of Limitations on Executive Compensation Tax Deductions

Section 162(m) of the Internal Revenue Code generally limits the deductibility of compensation paid in excess of $1 million to the chief executive officer and the three other highest compensated officers (other than the chief...more

UK Financial Regulatory Developments - April 2016 #5

ESMA consults on EU MAR commodity and spot markets disclosures - ESMA is consulting on draft guidelines under the Market Abuse Regulation (EU MAR) setting out a non-exhaustive indicative list of information expected or...more

Your daily dose of financial news The Brief – 3.23.16

John Thain’s golden parachute got knocked down a few karats this week, with CIT Group cutting 30% off of his farewell bonus for failing to “successfully integrate OneWest, the California bank CIT bought last year for $3.4...more

SEC Brings $11,000 SOX Clawback Action

The SEC alleges that Marrone Bio Innovations, Inc. misstated its revenue. The SEC recently brought a settled enforcement action against its former CFO. The SEC alleges the CFO received bonuses during the 12-month periods...more

Law Firm Hit by IRS After Paying out All Earnings as Deductible Compensation to Shareholders

A Chicago law firm operating as a corporation regularly zeroed out its taxable income by making year-end bonuses to its shareholders and deducting such payments as compensation. The IRS attacked the reasonableness of the...more

Your daily dose of financial news The Brief – 11.23.15

Clocking in at an as-promised $150 billion, the Pfizer/Allergan merger is a done deal, marking one of the biggest ever takeovers in the health care industry. As mentioned here last week, the deal finalization comes on the...more

How to Prevent Poaching of Your Startup's Employees

Employee “poaching” is a fact of life in many industries. Such employee recruiting is not intrinsically illegal, as a matter of public policy the law generally favors the ability of employees to freely switch employers....more

Input Sought on New Rules to Extend Overtime to More Workers

Employers and other stakeholders have just a few weeks in which to provide input on proposed regulations which would raise the salary threshold for workers exempt from overtime to $50,440 a year. On July 6, 2015 the...more

To Close or Not to Close: Tennessee Attorney General Weighs in on Hospital Bonuses and What Constitutes a Strategic Plan

On January 28, 2015, the Tennessee Attorney General ("Attorney General") issued a formal opinion ("Opinion") addressing whether Tennessee law permits "the board of a public hospital to meet in closed session to discuss...more

PRA Publishes Speech on Solvency II Models, Bonus Caps and Governance

On October 16, the Bank of England (BoE) published a speech given by Andrew Bailey, BoE Deputy Governor, Prudential Regulation and Chief Executive Officer, Prudential Regulation Authority, that considered, among other things,...more

Combination Bonus and Deferral Plan Subject to ERISA

The Fifth Circuit Court of Appeals held that a deferred compensation plan through which key employees received annual bonuses and were able to defer both bonuses and other income was an “employee pension benefit plan”...more

FINRA Moves Forward With Proposed Rule Requiring Disclosure Of Recruitment Bonuses

FINRA has submitted a proposal to the SEC to adopt FINRA Rule 2243 (Disclosure and Reporting Obligations Related to Recruitment Practices). In FINRA’s words, Rule 2243 would require, in some cases, “specific disclosure by...more

Employment Law 101: Bonuses

What counts as a bonus: There are a lot of ways to describe a bonus. For our purposes, a bonus includes any discretionary or non-discretionary payment or “compensation” to an employee outside of their regular hourly, salary,...more

"Clawback of Bonuses: UK PRA’s Banking Proposals Cast Six-Year Shadow for Bad Actors and Their Supervisors and Line Managers"

On 13 March 2014, the Prudential Regulation Authority (PRA), the U.K. regulator responsible for prudential supervision of banks, insurers and large broker-dealers, issued a consultation paper on bonus clawback (CP6/14). ...more

Financial Regulatory Developments Focus - March 25, 2014

In this issue: - Derivatives - Compensation - Regulatory Capital - Financial Market Infrastructure - Funds Enforcement - Events Hearings - People - Excerpt from...more

Contingencies on Employee Bonuses Delay Employer’s Tax Deduction According to IRS Chief Counsel Memo

An employer cannot deduct cash bonuses in the year in which its employees perform the services giving rise to the bonuses, but must wait until the following year when the bonuses are paid, under bonus plans with several...more

European Banking Authority Guidance on Financial Services Bonus Cap

Affected financial institutions and investment firms will need to overhaul the way they remunerate many of their highest-paid staff....more

UK Employment Alert No 209: Update on The Proposed European Cap on Bank Bonuses

Following recent discussions on this topic, lawmakers in the European Parliament have now adopted legislation intended to cap the value of bonuses paid to certain bank staff....more

The EU Reaches a Deal on the Proposed Ratio Cap on Bank Bonuses

On 27 February 2013 the European Union (“EU”) reached a provisional deal on imposing a cap on the variable remuneration that can be paid by financial institutions in the EU. If, as expected, this provisional deal is formally...more

District Court Widens Split On Whether Complaints Of Alleged Future Misconduct Are Protected

The U.S. District Court for the Central District of California ruled that a SOX whistleblower complaint survived a Rule 12(b)(6) challenge on “reasonable belief” grounds and found that complaints of potential future...more

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