The SEC adopted the Pay Ratio Rule in August 2015 to implement Section 953(b) of the Dodd-Frank Wall Street Reform and Consumer Protection Act.

The rule requires a public company to disclose the ratio of the median of the annual total compensation of all employees to the annual total CEO compensation. Companies must comply with the rule their first fiscal year beginning on or after January 1, 2017. This compliance date reflects a one-year additional delay as compared to the proposed rule.

Piwowar stated that companies are experiencing difficulties in preparing to comply with the rule, and he requested further public comment on whether relief is needed. The comment period will last 45 days.

This action could signal a further delay in the implementation of the rule, and may mark the first step towards additional SEC action to amend or rescind the rule (which would require notice and a public-comment period). See Dechert Newsflash, Trump Administration Discloses Another Rule in Doubt – SEC Questions the "Pay Ratio" Regulation.

SEC’s Public Statement

Pay Ratio Final Rule