Top CEOs widen pay gap with workers
Canada’s 100 highest-paid CEOs made 202 times more than the average worker made in 2019, according to a new report from the Canadian Centre for Policy Alternatives (CCPA).
This marks only the third time that the gap went over 200, though it’s down from the 227:1 ratio in 2018.
The report, entitled “The Golden Cushion: CEO Compensation in Canada,” says that by 11:17 a.m on Jan. 4. – an hour later than last year – the average top-100 CEO made the average worker’s salary of $53,482, based on 2019 corporate compensation data.
In contrast, the report says the average top-100 CEO pay in 2019 was $10.8 million, which means they made 202 times more than the average worker that year.
Factoring in the COVID-19 pandemic, which has decimated small businesses and cost thousands of jobs, the report concludes that “most higher-income workers have seen a complete recovery from whatever modest losses they experienced up to July 2020.”
“Proving that we are really not all in this together, a soaring stock market in the latter half of 2020 will likely not only keep CEO pay afloat but increase it over 2019 levels,” says report author and Senior Economist for the CCPA, David MacDonald.
MacDonald examined Canada’s CEOs “golden cushion” which has been allowing them to ride out the pandemic, noting that CEOs are paid differently than regular workers – insofar as most executive compensation comes from “variable pay” or bonuses.
The report recommends eliminating executive tax benefits such as the capital gains and stock option deductions, introducing new marginal tax rates on extreme incomes and ensuring companies that received COVID-related wage supports like the CEWS do not pay executive bonuses.