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Top CEOs earned 351 times more than typical worker

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Top CEOs earned 351 times more than typical worker

The CEO-to-worker pay gap has expanded exponentially over the past several decades.

The Economic Policy Institute (EPI) estimates that CEO compensation has grown 1,322% since 1978, while typical worker compensation has risen just 18%. In 2020, CEOs of the top 350 firms in the U.S. made $24.2 million, on average — 351 times more than a typical worker.

A 2019 Institute for Policy Studies report estimates that 80% of S&P 500 companies pay their CEO over 100 times more than they pay their median worker. That means it would take 100 years for the average employee at one of these companies to earn what their CEO makes in a year.

This kind of inequality is creating anxiety for families across the country and across the political spectrum. According to Pew, a majority of Americans think future generations will be financially worse off. 

CNBC Make It recently spoke with Lawrence Mishel, a distinguished fellow at the EPI about why the CEO-to-worker pay gap is expanding and what happens if nothing is done to close it. 

How did we get here?

“CEO compensation took off a lot in the 1990s. It did so as the stock market boomed and it’s basically a market that I believe is out of control. It’s what you could call a Lake Wobegon market,” says Mishel, referencing the NPR show “A Prairie Home Companion” which included a regular segment from host Garrison Keillor called “The News from Lake Wobegon,” a fictional town “where all the women are strong, all the men are good-looking, and all the children are above average.” 

Mishel’s point is that everyone in Lake Wobegon thinks they’re above average, just as every company thinks that their CEO should be compensated above average. 

“Firms believe that they’re an important place and they want a great executive. And if you have a great executive, then they certainly should be paid above average,” explains Mishel. “Now, if every firm decides that they’re going to pay their executive above average, and you look at what the pay of other executives are in firms similar to yours and you make sure that it’s more, over time, it just ratchets up and up and up and up.”

However, Mishel points out that salary makes up a relatively modest percentage of how much CEOs typically earn. 

“CEO compensation in our study reflects wages, bonuses and long-term incentives, but most importantly, the stock options that a CEO has cashed in each year, as well as any invested stock,” he says. “Stock-related compensation comprises around 85% of CEO compensation.”

Stock-related compensation is a key reason why CEOs earn so much more than even high earners. 

“It used to be that in the 1950s, 60s, and 70s, CEOs made 3.3 times what a top 0.1% earner made. Now, it’s more than six times,” says Mishel. “CEOs now are making 351 times that of a typical worker, but back in 1978, it was only 31 times. In 1989, it was 61 times.”

Mishel also mentions six potential reasons for why typical worker wages have not increased as quickly as typical CEO compensation: high unemployment (which forces workers into accepting the lowest wages possible), globalization (which allows companies to find the cheapest workers in the world), the erosion of unions (which makes it harder for workers to collectively bargain), low labor standards (including a low minimum wage), the increase in non-compete clauses (which makes it hard for workers to find better wages in their industry) and domestic outsourcing (like shifting to a workforce of freelancers). 

“Wages and benefits have not grown very much in the last 40 years. It has grown far less than what the economy produced,” he says, referencing research that found worker productivity has increased 3.5 times faster than average worker pay since the late 1970s.

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OSHA suspends enforcement of COVID-19 vaccine mandate for businesses

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OSHA suspends enforcement of COVID-19 vaccine mandate for businesses

The Occupational Safety and Health Administration (OSHA) is suspending enforcement of the Biden administration’s COVID-19 vaccine mandate for large private businesses after a federal appeals court upheld a stay on it last week.

OSHA said in a statement published on its website Friday night that while it is confident in its power to protect workers amid the pandemic, it is suspending activities related to the mandate, citing the pending litigation.

“The court ordered that OSHA ‘take no steps to implement or enforce’ the ETS [Emergency Temporary Standard] ‘until further court order.’ While OSHA remains confident in its authority to protect workers in emergencies, OSHA has suspended activities related to the implementation and enforcement of the ETS pending future developments in the litigation,” OSHA said.

President Biden announced in September that the administration was rolling out a new rule that would require all private employers with 100 or more employees to mandate vaccines or weekly testing for all personnel, a guideline that has the potential to impact nearly 80 million workers.

Earlier this month the administration set Jan. 4 as the deadline for qualifying private employers to start mandating the vaccine or requiring weekly testing. The rule was developed by OSHA.

In a 22-page ruling last week, the 5th U.S. Circuit Court of Appeals wrote that the administration’s COVID-19 vaccine and testing mandate was “fatally flawed” and ordered that OSHA not enforce the requirement “pending adequate judicial review” of a motion for a permanent injunction.

The court said OSHA should “take no steps to implement or enforce the mandate until further court order.”

The case originated when Texas Attorney General Ken Paxton (R), along with the states of Louisiana, Mississippi, Utah and South Carolina, filed a lawsuit against the Biden administration over the vaccine mandate in October, requesting a preliminary and permanent injunctive relief to stop the mandate from being enforced. The lawsuit also asked that the mandate be declared unlawful.

Earlier this month, the federal appeals court ordered a temporary halt on the mandate, but the Department of Justice then requested that the halt be lifted, contending that the administration has the legal authority to require COVID-19 vaccines or testing for larger companies and that the states that are challenging the mandate have not shown that their claims outweigh the harm of stopping of rule.

The court, however, upheld the stay, which prompted OSHA’s announcement that it is suspending enforcement of the rule.

More than two dozen state attorneys general and other groups are also challenging the mandate in court.

Despite the court’s ruling, however, the White House urged businesses to continue implementing the guidance for COVID-19 vaccines and testing.

Read more on The Hill

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Pfizer, BioNTech, Moderna making $1,000 profit every second

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Pfizer, BioNTech, Moderna making ,000 profit every second

Pfizer, BioNTech and Moderna are making combined profits of $65,000 every minute from their highly successful COVID-19 vaccines while the world’s poorest countries remain largely unvaccinated, according to a new analysis.

The companies have sold the vast majority of their doses to rich countries, leaving low-income nations in the lurch, said the People’s Vaccine Alliance (PVA), a coalition campaigning for wider access to COVID vaccines, which based its calculations on the firms’ own earning reports.

The Alliance estimates that the trio will make pre-tax profits of $34 billion this year between them, which works out to over $1,000 a second, $65,000 a minute or $93.5 million a day.

“It is obscene that just a few companies are making millions of dollars in profit every single hour, while just two percent of people in low-income countries have been fully vaccinated against coronavirus,” Maaza Seyoum of the African Alliance and People’s Vaccine Alliance Africa said.

“Pfizer, BioNTech and Moderna have used their monopolies to prioritise the most profitable contracts with the richest governments, leaving low-income countries out in the cold.”

Pfizer and BioNTech have delivered less than one percent of their total supplies to low-income countries while Moderna has delivered just 0.2 percent, the PVA said.

Currently, 98 percent of people in low-income countries have not been fully vaccinated.

The three companies’ actions are in contrast to AstraZeneca and Johnson & Johnson, which provided their vaccines on a not-for-profit basis, though both have announced they foresee ending this arrangement in future as the pandemic winds down.

PVA said that despite receiving public funding of more than $8 billion, Pfizer, BioNTech and Moderna have refused calls to transfer vaccine technology to producers in low- and middle-income countries via the World Health Organization, “a move that could increase global supply, drive down prices and save millions of lives.”

“In Moderna’s case, this is despite explicit pressure from the White House and requests from the WHO that the company collaborate in and help accelerate its plan to replicate the Moderna vaccine for wider production at its mRNA hub in South Africa,” the group said.

Read more on Medical Xpress

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Informers key in enforcing Biden vaccine mandate

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Informers key in enforcing Biden vaccine mandate

To enforce President Joe Biden’s forthcoming COVID-19 mandate, the U.S. Labor Department is going to need a lot of help. Its Occupational Safety and Health Administration doesn’t have nearly enough workplace safety inspectors to do the job.

So the government will rely upon a corps of informers to identify violations of the order: Employees who will presumably be concerned enough to turn in their own employers if their co-workers go unvaccinated or fail to undergo weekly tests to show they’re virus-free.

What’s not known is just how many employees will be willing to accept some risk to themselves – or their job security – for blowing the whistle on their own employers. Without them, though, experts say the government would find it harder to achieve its goal of requiring tens of millions of workers at companies with 100 or more employees to be fully vaccinated by Jan. 4 or be tested weekly and wear a mask on the job.

“There is no army of OSHA inspectors that is going to be knocking on employers door or even calling them,” said Debbie Berkowitz, a former OSHA chief of staff who is a fellow at Georgetown University’s Kalmanovitz Initiative for Labor and the Working Poor. “They’re going to rely on workers and their union representatives to file complaints where the company is totally flouting the law.’’

Jim Frederick, the acting chief of OSHA, told reporters that this agency will focus on job sites “where workers need assistance to have a safe and healthy workplace.”

“That typically comes through in the form of a complaint,” Frederick added.

Critics warn that whistleblowers have often faced retaliation from their employers and that OSHA has offered little protection when they do.

The new mandate, which Biden announced last week, is the administration’s most far-reaching step yet to prod more Americans to get a vaccine that has been widely available since early spring. The mandate will cover an estimated 84 million employees.

The president called the move necessary to combat an outbreak that has killed 750,000 Americans and that continues to spread. Companies that fail to comply will face fines of nearly $14,000 per “serious’’ violation. Employers found to be “willful’’ or repeat violators would be subject to fines of up to ten times that amount.

The mandate has run into furious opposition, though, from leaders of mainly Republican-led states who have condemned the plan as an unlawful case of federal overreach and who immediately challenged the vaccine-or-test requirements in court. On Saturday, the Biden administration endured a setback when a federal appeals court in New Orleans temporarily halted the mandate, saying it posed “grave statutory and constitutional issues.”

Should the mandate survive its legal challenges, though, the task of enforcing it would fall on OSHA, the small Labor Department agency that was established 50 years ago to police workplace safety and protect workers from such dangers as toxic chemicals, rickety ladders and cave-ins at construction sites.

OSHA has jurisdiction in 29 states. Other states, including California and Michigan, have their own federally approved workplace safety agencies. These states will have an additional month – until early February – to adopt their own version of the COVID mandate, equal to or tougher than OSHA’s.

For a task as enormous as enforcing the new vaccine mandate, OSHA and its state “partners’’ are stretched thin. Just 1,850 inspectors will oversee 130 million workers at 8 million job sites. So the agencies must rely on whistleblowers.

OSHA urges workers to first bring unsafe or unhealthy working conditions to the attention of their employers “if possible.’’ Employees could also file a confidential safety complaint with OSHA or have a case filed by a representative, such as a lawyer, a union representative or a member of the clergy. But they have no right to sue their employer in court for federal safety violations.

Read more on The Washington Times

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