Recent market volatility due to the coronavirus (COVID-19) pandemic has disrupted many companies’ day-to-day operations resulting in economic hardship that has caused companies to consider or implement various measures to reduce personnel costs, including pay cuts, furloughs and/or layoffs. When implementing such personnel cost-cutting measures, a number of companies have reduced executive pay, including reductions in base salary and bonus opportunities, and some have also reduced director retainers.

This memo summarizes the actions that a number of companies have already taken and provides guidance for companies considering reductions in executive or director pay.

Read the full memo here.

The COVID-19 pandemic and the ensuing market uncertainty, as well as recently enacted legislation, have upended the compensation and benefit programs of many companies. This memo is the fifth in a series of client memos that discuss considerations for companies as they navigate issues relating to their compensation programs amid—and in the wake of—the COVID-19 pandemic. The previous installments in this series can be accessed here, here and here and via hyperlinks included in this memo.

Associate Tessa Patti contributed to this publication.