S AMDT 1006

S 1006 IS

To require a supermajority shareholder vote to approve excessive compensation of any employee of a publicly traded company.

May 7, 2009

Mr. DURBIN introduced the following bill; which was read twice and referred to the Committee on Banking, Housing, and Urban Affairs

To require a supermajority shareholder vote to approve excessive compensation of any employee of a publicly traded company.

Be it enacted by the Senate and House of Representatives of the United States of America in Congress assembled,

SECTION 1. SHORT TITLE.

This Act may be cited as the ‘Excessive Pay Shareholder Approval Act’.

SEC. 2. AMENDMENT TO THE SECURITIES EXCHANGE ACT OF 1934.

(a) In General- Section 16 of the Securities Exchange Act of 1934 (15 U.S.C. 78n) is amended by adding at the end the following new subsection:

‘(h) Annual Shareholder Approval of Executive Compensation-

‘(1) IN GENERAL- The compensation for an employee of an issuer in any single taxable year may not exceed an amount equal to 100 times the average compensation for services performed by all employees of that issuer during such taxable year, unless not fewer than 60 percent of the shareholders have voted to approve such compensation (through a proxy or consent or authorization for an annual or other meeting of the shareholders, occurring within the preceding 18 months).

‘(2) PROXY CONTENTS- Proxy materials for a shareholder vote required by paragraph (1) shall include--

‘(A) the amount of compensation paid to the lowest paid employee of the issuer;

‘(B) the amount of compensation paid to the highest paid employee of the issuer;

‘(C) the average amount of compensation paid to all employees of the issuer;

‘(D) the number of employees of the issuer who are paid more than 100 times the average amount of compensation for all employees of the issuer; and

‘(E) the total amount of compensation paid to employees who are paid more than 100 times the average amount of compensation for all employees of the issuer.

‘(3) DEFINITION OF COMPENSATION-

‘(A) IN GENERAL- For purposes of this subsection, the term ‘compensation’ includes wages, salary, fees, commissions, fringe benefits, deferred compensation, retirement contributions, options, bonuses, property, and any other form of remuneration that the Commission determines is appropriate, in consultation with the Secretary of the Treasury.

‘(B) PART-TIME AND PART-YEAR EMPLOYEES- In the case of any employee which is a part-time employee of the issuer, or which is not employed by the issuer for a full taxable year, the compensation of such employee shall be calculated for purposes of this subsection on an annualized basis.’.

(b) Deadline for Rulemaking- Not later than 1 year after the date of enactment of this Act, the Securities and Exchange Commission shall issue any final rules and regulations required to carry out section 16(h) of the Securities Exchange Act of 1934, as added by this section.