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Labor, Employment and Benefits: Alert - February 6, 2012

The U.S. Supreme Court recently denied an employer’s request for review of a decision by the U.S. Court of Appeals for the Eighth Circuit, which held that tipped employees spending more than 20 percent of their time performing related but non-tipped duties must be paid the full minimum wage for that time, without the tip credit.

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Securities & Financial News to Note : Bulletin - February 6, 2012

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Securities & Financial News to Note
Bulletin - March 9, 2009
 
In this Issue...
SEC Guidance on “Say-on-Pay” Voting Requirements for TARP Recipients
 
 March 9, 2009
 

As previously discussed in the February 23, 2009 issue of Securities & Financial News to Note, President Obama signed into law the American Recovery and Reinvestment Act of 2009 (ARRA) on February 17, 2009. On February 24, 2009, the SEC’s Division of Corporation Finance issued a Compliance and Disclosure Interpretation (CDI) which was further updated on February 26, 2009. The CDI provides the Division’s interpretations of Section 7001 of ARRA, which amended Section 111(e) of the Emergency Economic Stabilization Act. Section 7001 requires any TARP recipient to “permit a separate shareholder vote to approve the compensation of executives, as disclosed pursuant to the compensation disclosure rules of the Commission.” The new CDIs include the following interpretations:

    • A separate shareholder vote on executive compensation is only required for the annual meeting of shareholders for which proxies will be solicited for the election of directors or a special meeting in lieu of such annual meeting.
    • Even if a smaller reporting company is subject to ARRA’s say-on-pay provision, the smaller reporting company is still not required to provide a compensation discussion and analysis under Item 402 of Regulation S-K.
    • A company that must file a preliminary proxy statement pursuant to Exchange Act Rule 14a-6(a) because it includes its own proposal to have shareholders approve executive compensation and faces special circumstances under which the company would like to request acceleration of the rule’s 10-day review period, should contact the Assistant Director of the office that reviews the company’s filings to discuss the special circumstances and how the review period could be accelerated.
    • The statute does not condition the requirement for a vote on executive compensation on receipt of a shareholder proposal on approving executive compensation.
    • A shareholder proposal on say-on-pay in a company’s proxy statement that only requests that a company adopt a policy providing for annual shareholder votes on executive compensation in the future does not satisfy the statute which requires an actual non-binding vote by the shareholders to approve executive compensation.
      While ARRA does not specify an effective date for Section 7001, Chairman Dodd’s letter dated February 20, 2009, to Chairman Schapiro stated his belief that it became effective on February 17, 2009, and applies to preliminary and definitive proxy statements filed on or after February 17, 2009, (except for definitive proxy statements which relate to preliminary proxy statements filed on or before February 17, 2009).

http://www.sec.gov/divisions/corpfin/guidance/arrainterp.htm

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