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IRS Issues Initial Guidance Regarding Trump Accounts

"Employers may make contributions of up to $2,500 (subject to cost-of-living adjustments after 2027) per calendar year to the Trump account of an employee (or the employee's dependent) that will be excluded from the employee's gross income. An employer must make contributions under a 'Trump account contribution program,' which is a separate written plan maintained by the employer for the exclusive benefits of its employees that meets requirements regarding discrimination, eligibility, notification, statements and benefits similar to the requirements of a dependent care assistance program under Section 129 of the Internal Revenue Code."

FTC Noncompete Rule Is Set Aside, But Appeal Is Expected and States May Act

"The validity of the rule is likely to come before the Third, Fifth and Eleventh Circuits, and the possibility of circuit conflict also means that the issue could potentially receive Supreme Court review. At the same time, states are also undertaking their own efforts to restrict noncompete clauses under state law." [Ryan LLC v. Federal Trade Commission, No. 24-0986 (N.D. Tex. Aug. 20, 2024)]

2024 Compensation Committee Handbook (PDF)

134 pages. "This handbook focuses on considerations for publicly traded companies and specifically those listed on the New York Stock Exchange (NYSE) or Nasdaq. Many of the principles discussed have broader application ... [The authors] discuss the developments over the past year to executive and director compensation practices and related trends, particularly with respect to implementation of the SEC's clawback rule in connection with the Dodd-Frank Act and pay-versus-performance disclosure requirements."

SEC Staff Issues New and Revised Pay-Versus-Performance Compliance and Disclosure Interpretations

"These most recent C&DIs: [1] supplement the C&DIs issued by the staff on February 10, 2023, and September 27, 2023; [2] provide additional answers to some of the questions that companies encountered in complying with the [pay-versus-performance] disclosure rules for the first time during the 2023 proxy season; and [3] clarify certain portions of the earlier C&DIs subject to the most debate."

December 1 Deadline Approaches for Listed Companies to Adopt a Dodd-Frank Compliant Clawback Policy

"[L]isted companies must seek to recover erroneously awarded incentive-based compensation received by covered executives on or after October 2, 2023.... [L]isted companies have ... until December 1, 2023, to adopt a compliant policy.... [This article includes a side-by-side] comparison of the NYSE and Nasdaq notice and cure provisions for failure to adopt a compliant policy or to comply with the clawback requirements:"

NAIC Releases Draft Model Bulletin Regarding Use of AI by Insurers

"The draft Model Bulletin encourages insurers to develop, implement and maintain a written program for the use of AI systems that is designed to mitigate the risk that the use of AI systems in making or supporting decisions affecting insurers' customers will result in decisions that are arbitrary or capricious, unfairly discriminatory or that otherwise violate unfair trade practice laws.... It remains to be seen whether and to what extent state insurance departments will adopt and distribute the Model Bulletin in its final form."

Executive Compensation Due Diligence in M&A Transactions

"A thorough review of the compensation arrangements of the target company should be conducted early in the transaction process as part of the broader due diligence process. This review allows the acquirer to gain a comprehensive understanding of the target's compensation program and to uncover any compensation-related liabilities or legal/regulatory compliance issues ... The acquirer's compensation diligence may surface information needed to accurately draft the transaction documents and to plan for post-closing integration of the target's compensation programs."

NYSE and Nasdaq Postpone Effective Date of Dodd-Frank Clawback Requirements

"The stock exchanges have delayed effectiveness of the proposed listing standards until October 2, 2023 ... In addition, the NYSE amended its proposed listing standards to provide additional relief in the event of noncompliance with the clawback rules.... [L]isted companies should prepare to have final Dodd-Frank compliant clawback policies ready for adoption by December 1, 2023."

SEC Provides Update on Timing of Dodd-Frank Clawback Rules

"[The SEC designated] June 11, 2023, as the final date by which it will 'either approve or disapprove, or institute proceedings to determine whether to disapprove' the proposed NYSE and Nasdaq listing standards, which the exchanges have provided will become immediately effective upon SEC approval."

2023 Compensation Committee Handbook (PDF)

130 pages. "This year's handbook reflects important updates, including on the SEC's new clawback rules, the new pay-versus-performance proxy disclosure requirements, changes in proxy advisory firm policies and the continued focus on environmental, social and governance considerations in structuring compensation arrangements."