Excerpt from Practical Guidance

Addressing Workplace Misconduct With Exec Compensation

By John Utz ( November 5, 2018, 12:23 PM EST) -- Employer efforts to reduce the incidence of workplace sexual harassment and to identify and punish wrongdoers have increased significantly. This is particularly evident with reference to a task force study by the U.S. Equal Employment Opportunity Commission on the proliferation of sexual harassment in the workplace. The EEOC report indicates that workplace harassment remains a persistent problem. This includes charges of harassment on the basis of sex, race, disability, age, ethnicity/national origin, color and religion. However, the report notes particularly that sexual misconduct affects 25 percent or more women in the workplace.[1] The results of the #TimesUp movement indicate, too, that members of the public appear to favor firmer treatment of executives and others who have engaged in sexual harassment or assault (hereafter collectively referred to as sexual misconduct). Compensation committees may find value in reflecting this new attitude in the structure of their companies' executive pay programs. This article discusses ways that employers can design executive compensation packages to discourage or censure executive sexual misconduct....

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