George S. May Business Blog

Pay czar, Ken Feinberg, strikes again

The BBC is reporting that Kenneth Feinberg, also known as the US executive “pay czar”, will extend the already set limits on executive pay for Citigroup, AIG, GM, and GMAC. The restrictions will now be extended from the top-paid 25 staff members to the 100th highest paid staff member. Those who are a member of the 26-100 group will not be allowed to earn over $500,000 per year under the new restrictions.  
The ruling does not apply to Bank of America because it repaid its bailout money this week, and Chrysler and Chrysler Financial were exempted because total pay for their second-tier executives is already under $500,000.

Seeing as the year is nearly over, the ruling will not apply to money already earned by the employees, but will have an affect on many employees’ year-end bonus.

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