Pumping Up CEO Pandemic Pay

Lead Report Author to Present at Webinar, 11 AM Today

More than half of the country’s 100 largest low-wage employers rigged pay rules in 2020 to give CEOs 29 percent average raises while their frontline employees made 2 percent less

Washington, D.C. — A new Institute for Policy Studies report reveals staggering new statistics on top-tier U.S. corporations that moved bonus goalposts or made other changes to compensation rules to increase CEO pay while their low-wage workers suffered during the pandemic.

Key findings:

Of the 100 S&P 500 firms with the lowest median worker wages, 51 moved bonus goalposts or made other rule changes in 2020 to pump up executive paychecks. Among these 51 rule-rigging companies:

  • Average CEO compensation: $15.3 million, up 29 percent from 2019.
  • Median worker pay: $28,187 on average, down 2 percent from 2019.
  • Average CEO-median worker pay ratio: 830 to 1.
  • Highest CEO pay: Hilton CEO Christopher Nassetta. Stock award “adjustments” inflated Nassetta’s total compensation to $55.9 million, 1,953 times as much as the company’s median worker pay of $28,608.
  • Widest pay ratio: Auto parts maker Aptiv. By manipulating bonus metrics, the board pumped up CEO Kevin Clark’s compensation to $31.3 million, 5,294 times the company’s $5,906 global median worker pay.
  • Lowest median pay: Aptiv, followed by Under Armour . The Under Armour board altered bonus metrics and replaced performance-based with time-based stock awards to boost CEO Patrik Frisk’s pay to $7.4 million, 1,104 times the Under Armour median worker pay $6,669.

“It’s time for public policy to shift corporate America away from a business model that creates prosperity for a few at the top and precarity for so many of the rest of us,” said report lead author Sarah Anderson , director of the IPS Global Economy Project and a veteran executive compensation analyst. “By inflating executive compensation while their workers struggled during a pandemic, corporate boards have strengthened the case for tax penalties on huge CEO-worker pay gaps.”

Full report

Report launch event at 11 am Eastern today

The Tax Excessive CEO Pay Act would incentivize corporations to narrow their pay divides by imposing tax rate increases of 0.5 to 5.0 percentage points, depending on the size of the gap between the highest-paid executive and median worker. If this bill had been in place in 2020:

  • Walmart, with a pay gap of 1,078 to 1, would have owed an extra $1 billion in federal taxes, enough to fund 13,502 clean energy jobs for a year.
  • Amazon, with a 1,596-to-1 pay ratio, also would have owed an extra $1 billion, enough to underwrite 115,089 public housing units for a year. Amazon’s highest-paid executive, Worldwide Consumer CEO David Clark, had $46.3 million in 2020 compensation.
  • Home Depot, with a 511-to-1 gap, would have owed an extra $800 million, enough to create 18,329 jobs that pay $15 per hour with benefits for a year.

The full report, “Pandemic Pay Plunder” is available at: https://ips-dc.org/report-executive-excess-2021

Anderson will present the report on a webinar today, May 11 at 11 Eastern , that is open to the public. Other speakers include philanthropist and CEO-worker pay gap critic Abigail Disney and Dan Price , the Gravity Payments CEO known for flattening his company’s pay scale. Registration is required.

This 27th edition of the annual IPS Executive Excess series also includes the most comprehensive available catalog of policy options for reining in CEO pay.

About the lead author: Sarah Anderson directs the Global Economy Project at the Institute for Policy Studies and co-edits the IPS web site Inequality.org . She has been the lead author on all 27 of the Institute’s annual Executive Excess reports. She shared preliminary findings from this research in testimony before the Senate Budget Committee in March 2021. Her executive compensation analysis has been featured in NPR’s 1A , The Guardian , CNN , Washington Post , the New York Times , and many other outlets.

The Institute for Policy Studies (IPS-DC.org) is a multi-issue research center that has conducted path-breaking research on executive compensation for more than 20 years. IPS also provides a constant stream of inequality analysis and solutions through our Inequality.org web site and weekly newsletter .


Sarah Anderson, sarah@ips-dc.org

Olivia Alperstein, olivia@ips-dc.org , (202) 704-9011

Bob Keener, bobk@ips-dc.org , (617) 610-6766

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