Docstoc

Retention_ Retention_ Retention_

Document Sample
Retention_ Retention_ Retention_ Powered By Docstoc
					Carrots, Handcuffs, & Parachutes
      Compensation Best Practices
         in Times of Change

             Chris Crawford
             (281) 378-1353
       crawfordc@longnecker.com
      The Evolution of Rewards


  1930-50s   1950s-1970s     1980s-1990s        2000s



                 Components
• Hourly     • Salary      • Salary         • Salary
             • Benefits    • Variable pay   • Variable pay
                           • Equity         • Equity
                           • Benefits       • Retirement Benefits
                                            • Employment Agreements
                                            • The work experience
                                            • Perquisites
Unparalleled Compensation Landscape
  n Sarbanes Oxley - 2002
  n 409A
  n IRS Audits
  n FAS 123R
  n SEC Proxy Disclosure
  n Unfunded/Underfunded Pension Liabilities
  n Media attention on Executive Compensation
  n 70 Million Retiring Baby Boomers
  n Tremendous growth in Texas Energy &
    Banking markets
Objectives of Employee Rewards
Business Life Cycle Changes
       Compensation Best Practices:
                Start-up
Amount of Pay
n Target Compensation 3-4 years out
Mix of Pay
n Low emphasis on Base Salary, High emphasis on short term
  incentive, Highest emphasis on long-term incentive
n Utilize actual stock (restricted stock, stock options) when
  possible
n Multiple year, long-term incentive awards
n Short-term incentives: formula + discretion
n Employment Agreements: Non-solicitation
n Emphasize Work Experience, Being able to affect change
    Compensation Best Practices:
             Growth
Amount of Pay
n Target Compensation 1-3 years out
Mix of Pay
n Market Base Salary, Market Benefits, High emphasis on
  short-term and long-term incentive
n Utilize actual stock (restricted stock, stock options) when
  possible
n Deferred compensation: Restricted Stock and/or Company
  Match
n Employment Agreements
      Compensation Best Practices:
                M&A
Retain, Retain, Retain

n   Acceleration of stock vesting – Be Wise!
n   Transition/Transaction Bonuses
n   Change of Control/Termination Payouts: Multiple of Base +
    Bonus
n   Employment Agreements
n   Non-Solicitation Agreements
      Compensation Best Practices:
         Tight Labor Market
Attract & Retain

n   Sign on Awards
n   1 Time Retention Awards: Stock & Cash
n   Deferred Compensation + Company Match
n   Recognition, Recognition
n   Diversify the long-term incentive awards
n   Tailor compensation programs
Questions

				
DOCUMENT INFO
Shared By:
Categories:
Tags:
Stats:
views:0
posted:7/26/2013
language:English
pages:10