House Committee Passes Velázquez Bill to Require CEO Pay Disclosure
Washington, DC – The House Committee on Financial Services has passed legislation authored by Rep. Nydia M. Velázquez (D-NY) that would help to address the growing income discrepancy between CEOs and other senior staff and median-pay employees. Velázquez’s bill, the Greater Accountability in Pay Act or H.R. 1188, would require public companies to disclose the pay raise percentage of its executives and median-pay employees, as well as compare each to the rate of inflation.
“The gap between executive compensation and the average worker pay has been growing for decades, but the COVID-19 pandemic has exacerbated the disparity,” said Velázquez. “The pandemic has left millions of working-class Americans feeling vulnerable and uncertain about their economic future; with many individuals and families forced to work part time or laid off altogether. Meanwhile, top executives are thriving and many have seen a highly profitable year. Disclosing the ratio between the pay raise percentages, which is what my bill does, will help to put pressure on millionaires and billionaires to pay their fair share.”
The legislation builds on the Dodd-Frank Wall Street Reform and Consumer Protection Act. Dodd-Frank required publicly traded companies to provide information comparing the annual compensation of their CEOs to their employees. Velázquez's bill would go a step further, requiring publicly traded companies to disclose the pay raise percentage of its executives and the pay raise percentage of its median employees over the past year and compare each to the rate of inflation.
The bill now must be approved on the House floor before heading to the Senate.