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Why Employers Should Revisit Their Executive Compensation Strategies

"Roughly four in 10 companies are planning or considering changes to their executive pay programs, or have already taken action," a recent Willis Towers Watson study cited by Employee Benefit News (Feb. 12, Olsen) shows.  While 59 percent of employers say they have no plans to make changes to their executive pay strategies, experts say they may seek to revisit their compensation metrics later in 2018 once they set their fiscal-year goals.  The most common changes companies are considering or have made include spending more time and analysis on this year's incentive target and increasing the use of discretion in 2018 incentive plans.  Steve Seelig, Willis Towers Watson's executive compensation counsel, says when discussing executive pay, employers should focus on a couple of major changes resulting from the Tax Cuts and Jobs Act. The first is that companies' tax rates will go down. The second revolves around the timing of when the act was signed into law.

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