Los Angeles Executive Compensation Lawyers

American businesses thrive on competition. Successful businesses often grow into powerful companies over time. The people who run these businesses, known as “executives,” are responsible for making vital business decisions, creating and maintaining a company culture, and making good on stakeholders’ investments. Due to the nature of their work, executives often receive handsome salaries and attractive benefits packages. Additionally, many executives are awarded bonuses for reaching sales goals and other milestones.

If you have questions or concerns about executive compensation laws in Los Angeles, speak with one of the Los Angeles executive compensation attorneys at Mathew & George. We have extensive experience in all manner of employment-related cases, including executive compensation and SEC requirements. Reach out to us to set up a consultation or for more information about California state laws for executives.

Executives are often paid astronomical amounts for their business acumen and decision-making responsibilities. The US Securities and Exchange Commission (SEC) governs the ways in which executives may be compensated. There are several special considerations when it comes to executive compensation, and it is important for business leaders and employees to understand these rules and how they apply to their employers. If a business is not in line with the SECs guidelines regarding executive compensation, they are making themselves vulnerable to a lawsuit. Our LA employment law attorneys have extensive knowledge in executive compensation lawsuits and can fight for your rights as an employee.

Transparency for Executive Compensation

Executives of American companies typically handle a broad spectrum of their companies’ practices. Commonly seen executives include the:

  • Chief Executive Officer (CEO). This is the top position in many American companies. A CEO is typically responsible for moving the business forward, developing new goods and services, and creating returns for investors. CEOs are typically paid more than anyone else in an enterprise.
  • Chief Financial Officer (CFO). This executive is responsible for the company’s major financial decisions, such as payroll, purchasing, budgeting, tax issues, and bookkeeping.
  • Chief Security Officer (CSO). This is the executive in charge of a company’s cybersecurity. This position only recently became a necessity in the digital age. Today, US companies annually invest billions into IT support and cybersecurity. Data is one of the most valuable commodities on Earth in the right hands, and CSOs are typically responsible for all cybersecurity concerns as well as other safety measures for the enterprise.
  • Chief Operating Officer (COO). This executive works closely with all departments to ensure the company stays profitable.

As you can see, these executives are responsible for maintaining a company and making important decisions that can affect their entire workforces, customer bases, investors, and business partners. However, the SEC dictates that executive compensation details must be made available to company shareholders so that they have a better understanding of how the company is managed and can make more informed investment decisions.

It is important to note that the SEC does not dictate how much executives may be paid. This is a business decision—the SEC only has jurisdiction over disclosure. Investors need this information to make informed business decisions.

California Executive Benefits and Bonuses

Benefits and bonuses are two other forms of executive compensation. Benefits typically include health insurance, retirement funds, and stock options. Bonuses are usually paid out if companies meet specific sales goals. Unfortunately, several businesses opt to “reset” targets if it becomes clear that a target will not be met as expected. For example, if an executive’s bonus hinges on a 15% target sales increase by a deadline, and projections indicate that the result will likely be no more than 12%, the executives may essentially “move the goalpost” to 11% to ensure executives receive their bonuses. While not exactly illegal, these tactics are widely frowned upon.

Ultimately, company executives are responsible to their shareholders, customers, and employees for keeping the business profitable and clearly disclosing their compensation details. This is vital public knowledge so people can make informed choices about their dealings with the business.

If you believe your company or a company you invest in is not disclosing this information, contact the Los Angeles executive compensation attorneys at Mathew & George to see how we can help. Although we are based in Los Angeles, we serve clients throughout California, and have an office in the Bay Area.