Follow KDKA-TV: Facebook | Twitter
PITTSBURGH (KDKA) — For the first time, Americans are learning how big the compensation disparity is between corporate CEOs and their average employee pay.
“Some CEOs get paid an enormous pay package, and then the companies do not do very well,” University of Pittsburgh Katz Business School Prof. Jay Sukits told KDKA money editor Jon Delano on Friday.
Thanks to the Dodd-Frank Law, publicly held companies must disclose in their proxy statements the pay ratio between the CEO and the company’s median paid employee.
The results, gathered by the AFL-CIO, are shocking, especially when CEOs fail to compensate others, says Sukits.
“CEOs have the ability and usually have the managerial authority to change the level of pay of their workers,” he says.
While not all companies have filed yet, companies with the greatest disparities include Weight Watchers where the CEO makes 5,908 times the median employee salary there, Mattel where the CEO makes 4,987 times, Abercrombie & Fitch where the CEO makes 3,431 times, McDonald’s where the CEO makes 3,101 times, and Gap where the CEO makes 2,900 times the average worker.
The national average now finds CEOs making 361 times the average worker, meaning the average CEO makes in one day what the employee takes a full year to make.
While most Pittsburgh companies are below the national average, at least four exceed it.
CEOs at American Eagle make 1,064 times the average employee, and Dick’s CEO makes 1,015 times more than their average employee. It’s 453 times at GNC and 382 times at PPG.
Other than reporting the info, there’s no law that dictates CEO compensation. Says Sukits, it’s up to the shareholders.
“I really hate to see the government trying to get involved,” he said.
But one sector not reporting may be even worse.
“Some of the most outrageous pay packages you’ll see are for CEOs at things like non-profits,” Sukits said.
You can check out the full report or your own employer here: https://aflcio.org/paywatch