Despite extensive delays, the SEC is now expected to release preliminary guidance related to the CEO Pay Equity Rules that are part of the Dodd-Frank legislation as early as September. The Pay Equity disclosure would require companies to compare the total compensation of the CEO to that of the median employee in the global organization. This would require companies to calculate total compensation, including change in pension value, for every employee globally.

Many groups as well as factions within congress lobbied to have this provision of Dodd-Frank removed as the resources required to implement it are anticipated to outweigh the benefits of the additional disclosure. While there has been limited information released from the SEC, it is likely that the guidance will be somewhat less onerous than originally expected, possibly only requiring companies to compare CEO compensation to a sample of employees as opposed to the entire population.  More questions than answers still remain, including when the disclosure will be effective.  However, as soon as preliminary guidance is released, we will send a comprehensive CAPFlash on the guidance.