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Canada’s highest-paid CEOs make 246x the average worker, says new report

Published

9 months ago

January 2, 2024

It was another record-breaking year for Canada’s richest CEOs.

In one work day, and less than a half hour into the new year — 27 minutes to be exact — Canada’s 100 highest-paid CEOs will have already earned the average worker’s annual salary, according to a new study by the Canadian Centre for Policy Alternatives (CCPA).

It translates to roughly $60,600 by 9:27 a.m. on Jan. 2, if you include Monday as a paid holiday, according to the report.

The CCPA, an Ottawa-based think-tank that focuses on social, economic and environmental issues, found that the 100 best-paid CEOs in Canada now make 246 times what the typical worker earns. That number breaks last year’s record of 243 times the average worker’s pay.

“The 100 CEOs, who are overwhelmingly male, got paid an average of $14.9 million in 2022. This amount surpasses their previously record-breaking pay of $14.3 million in 2021 and sets a new all-time high in our data series,” said David Macdonald, a senior economist at the CCPA and the report’s author.

Lana Payne, the national president of Unifor, Canada’s largest private sector union, calls the report “enraging.”

“We’ve seen CEO pay increase consistently over the last number of years to a point now where it’s the highest it’s been … And at the same time we have these CEOs and the employer clubs that they’re part of lobbying every single day and fighting tooth and nail to make sure that we don’t have better labour laws in this country,” she said.

How one CEO tries to keep things on an ‘even scale’

Not all CEOs, however, are paid such large amounts of money. Hosni Zaouali, the CEO of ConnectED Labs, a Toronto-based technology company, has a specific formula that he said he follows to ensure his pay and his employees’ pay are on an “even scale.”

He said the highest salary at his company is “never 10 times higher than the lowest salary.”

Hosni Zaouali, the CEO of ConnectED Labs, says the highest salary at his company is never more than ’10 times higher than the lowest salary.’ (CBC News)

“It means that if the company shows success, operational success and financial success, it’s not only thanks to the CEO, it’s also thanks to everybody, including the lowest salary in the company. So we make sure that everybody gets compensated accordingly,” he said.

Zaouali said it’s “very important that the lowest salary is not too far from the highest salary in our company to keep everybody energized and everybody motivated.”

While base salary is an important factor when considering CEO wealth, it doesn’t provide a full picture of their total compensation, according to the CCPA report.

A ‘story about inflation’

Like last year’s report, which CBC News also covered, part of the explanation for the large increases in CEO pay is linked to inflation, Macdonald said.

“This is largely a story about inflation … CEOs are paid primarily through bonuses, and those bonuses are based on things like revenue and profits. When revenue and profit goes through the roof due to inflation, bonuses go through the roof.”

Macdonald said despite this, salaries for average workers are often not keeping up with inflation.

“In 2022, the average worker in Canada got an average pay raise of $1,800, or three per cent. But prices went up by 6.8 per cent in 2022, meaning workers took a real pay cut of almost four per cent compared to 2021.”

WATCH | ‘It’s a lot harder than it usually is’: Budgeting for holiday shopping with inflation:

‘It’s a lot harder than it usually is’: Budgeting for holiday shopping with inflation

Shoppers and their wallets are feeling the pain of the increase in the cost of living this holiday season.

In comparison, the top 100 CEOs saw an average pay raise of $623,000, or 4.4 per cent in 2022, according to the report.

One economist said studies like the one presented by the CCPA are “flawed.”

“The only way you can arrive at this conclusion is that you’re comparing oranges with apples,” said Vincent Geloso, an assistant professor of economics at George Mason University in Virginia.

Geloso said reports like this fail to include other forms of employee compensation like benefits.

“People get more fringe benefits in the form of insurance, in the form of flexible hours. Things that employers pay for but aren’t considered compensation. When you include them, and you include that instead of wages alone, you’re getting a completely different portrait.”

In a 2020 report for the Fraser Insitute, a Canadian think-tank promoting private sector solutions, Geloso also argues that CEOs are paid for possessing unique skill sets that are increasingly in demand.

“Today you find CEOs who have a larger share of PhDs and MAs and MSCs and STEMs. So they’re in harder sciences and harder domains, so there’s greater levels of skill in terms of pure knowledge.”

Addressing the gap

Lana Payne, the union leader, thinks governments can help reduce growing inequality. She supports measures such as improving and expanding access to collective bargaining rights for workers, raising the minimum wage and ensuring people have guaranteed hours of work.

“I think the challenge is that more work needs to be done on a number of fronts to make sure that workers are not falling behind,” said Payne, who believes these measures could reduce what she calls the “inequality gap.”

Improving and expanding access to collective bargaining rights for workers, improving minimum wages, and making sure people have guaranteed hours of work are some of the things Lana Payne, the national president of Unifor, says could contain what she calls the ‘inequality gap.’ (CBC News)

The CCPA report also makes several suggestions for reducing the pay gap. The group suggests: introducing higher top marginal tax brackets, removing corporate tax deductability for compensation over $1 million, introducing a wealth tax on the rich and increasing the capital gains inclusion rate (making CEOs pay more taxes on the money they make selling stocks).

“We’ve seen the active closure of the stock option deduction in 2021 as well as new higher income tax brackets in 2016. So this is something where we’ve seen a lot of debate particularly in other areas like a new wealth tax,” said Macdonald.

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Tampa Bay Lightning select Victor Hedman as captain, succeeding Steven Stamkos

Published

7 hours ago

September 18, 2024

Anne Joseph

TAMPA, Fla. (AP) — The Tampa Bay Lightning selected Victor Hedman as the team captain on Wednesday as training camp opened, making the big defenseman the successor to Steven Stamkos.

Hedman, who is going into his 16th season with Tampa Bay, was considered the obvious choice to get the “C” after the Lightning did not re-sign Stamkos and their longtime captain left to join Nashville.

“Victor is a cornerstone player that is extremely well respected by his teammates, coaches and peers across the NHL,” general manager Julien BriseBois said. “Over the past 15 seasons, he has been a world-class representative for our organization both on and off the ice. Victor embodies what it means to be a member of the Tampa Bay Lightning and is more than ready for this exciting opportunity. We are looking forward to watching him flourish in his new role as we continue to work towards our goal of winning the Stanley Cup.”

The 33-year-old from Sweden was a key contributor in the Lightning hoisting the Cup back to back in 2020 and ’21, including playoff MVP honors on the first of those championship runs. Hedman also took home the Norris Trophy as the NHL’s top defenseman in 2018 and finished in the top three in voting five other seasons.

Ryan McDonagh, who was reacquired early in the offseason in a trade with the Predators, and MVP finalist Nikita Kucherov will serve as alternate captains with the Lightning moving on to the post-Stamkos era.

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Toronto FC Jason Hernandez looks to clean up salary cap and open up the future

Published

7 hours ago

September 18, 2024

Anne Joseph

TORONTO – While Toronto FC is looking to improve its position on the pitch, general manager Jason Hernandez is trying to do the same off it.

That has been easier said than done this season.

Sending winger Jahkeele Marshall-Rutty to CF Montreal for up to $1.3 million (all dollar figures in U.S. funds) in general allocation money before the secondary transfer window closed in early August helped set the stage for future moves.

But there have been plenty of obstacles, which Hernandez has been working to clear.

“We feel a lot more confident going into this upcoming off-season that we did the one prior,” said Hernandez. “There’s a level of what I would say booby-traps that were uncovered when I first got the (GM) role at the end of last summer.”

The club is paying off departed forwards Adam Diomande and Ayo Akinola as well as a $500,000 payment due in 2024 to Belgium’s Anderlecht for Jamaican international defender Kemar Lawrence. That payment was part of the transfer fee for Lawrence, who joined TFC from Anderlecht in May 2021 and was traded to Minnesota United in March 2022.

Diomande was waived while Akinola’s contract was terminated by mutual agreement.

“That comes to an end in ’25, which is nice,” said Hernandez. “We had to suffer from a salary cap perspective this season. But those things coming off, the Jahkeele Marshall-Rutty money coming in, we’re going to be in a position to make some good additions, which is positive.”

While MLS clubs are allowed one contract buyout per year, Toronto had already used its on former captain Michel Bradley, who retired after last season. Bradley had previously restructured his contract, deferring money.

TFC’s only other move during the summer transfer window was the signing of free-agent defender Henry Wingo. Hernandez said the club knew going into the window that it was likely limited to the one acquisition “unless other business happened”

“We knew we had this bucket of money and we knew we were going to go get Henry,” said Hernandez.

While the sale of the highly touted Marshall-Rutty opened up other possibilities, it came on the eve of the transfer window closing. And the team did not like what it saw in the free-agent market.

“A lot of the opportunities we were presented in the free agency space felt more like a short-term, Band-Aid decision versus what actually the club probably needs.”

Hernandez was not willing to take in players who came with a “club-friendly” salary cap charge in 2024 and a much bigger number in 2025.

Instead, Toronto promoted forward Charlie Sharp and wingback Nate Edwards to the first team from TFC 2 ahead of last Friday’s roster freeze.

MLS teams are operating on a salary budget of $5.47 million this season, which covers up to 20 players on the senior roster (clubs can elect to spread that number across 18 players). But the league has several mechanisms that allow those funds to go further, including using allocation money (both general and targeted) to buy down salaries.

Designated players only count $683,750 — the maximum salary charge — against the cap no matter their actual pay. Toronto’s Lorenzo Insigne is actually earning $15.4 million with fellow Italian Federico Bernardeschi collecting $6.295 million and Canadian Richie Laryea $1.208 million.

Hernandez says Laryea’s contract can — and “very likely” will — be restructured so as to remove the designated player status.

There are benefits in going with just two designated players rather than three.

Teams that elect to go with two DPs can sign up to four players as part of the league’s “U22 Initiative.” The pluses of that structure include a reduced salary cap charge for the young players and up to an extra $2 million in general allocation money.

Hernandez says the club is currently pondering whether that is the way to go.

Captain Jonathan Osorio who is earning $836,370 this season, restructured his deal to allow the team to sign Laryea as a DP. In doing so, Osorio had his option year guaranteed so his contact runs through 2026.

Hernandez and coach John Herdman will have decisions to make come the end of the year.

The contracts of goalkeeper Greg Ranjitsingh ($94,200), defenders Kevin Long ($277,500), Shane O’Neill ($413,000) and Kobe Franklin ($100,520), midfielder Alonso Coello ($94,050) and Brandon Servania ($602,710), and forward Prince Owusu ($807,500) — all on the club’s senior roster — expire at the end of 2024 with club options to follow.

While there is more work to do, Hernandez believes TFC is on the right road.

Toronto, which finished last in the league at 4-20-10 in 2023, went into Wednesday’s game against visiting Columbus in a playoff position at eighth in the East at 11-15-3.

“By every metric, we are miles ahead of where we were at this point last year,” said Hernandez.

“That’s a low bar, so that’s not saying much,” he added.

But he believes TFC is “quite competitive” when it has all its players at its disposal.

“To get results in this final stretch, we’re going to need our prominent players to really show up and have big performances, and be supported by the rest of the cast.”

After Columbus, TFC plays at Colorado and Chicago and hosts the New York Red Bulls and Inter Miami. The club also travels to Vancouver for the Canadian Championship final.

—

Follow @NeilMDavidson on X platform, formerly known as Twitter

This report by The Canadian Press was first published Sept. 18, 2024

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Canada’s Hughes may be what International team has been missing at Presidents Cup

Published

7 hours ago

September 18, 2024

Anne Joseph

Mackenzie Hughes might just be what the International team needs as this year’s Presidents Cup.

Hughes, from Dundas, Ont., is one of three Canadians on the squad competing in the match-play event at Royal Montreal Golf Club next week.

His putting skills, cool demeanour under pressure, pre-existing connections with teammates and clubhouse leadership could help the team — made up of non-American players outside Europe — end a nine-tournament losing skid to the United States at the biennial event.

“I’ve had this one circled on the calendar for a few years now,” said Hughes on joining fellow Canadians Taylor Pendrith and Corey Conners as captain’s picks on the 12-player International team. “I pretty much knew that when it was announced the tournament would be in Canada and that Mike Weir was going to be the captain, you pretty much knew where that was going to go.

“To get that call from (Weir) is really special because he’s the guy that I looked up to, we all looked up to, as Canadian golfers.”

Pendrith and Conners are returning to the team after a disappointing 17 1/2 to 12 1/2 loss to the United States at Quail Hollow Club in Charlotte, N.C. in 2022.

Hughes was ranked 14th on the International team standings in 2022 and could have easily been included on that squad after Australia’s Cameron Smith and Chile’s Joaquin Niemann were ruled ineligible after jumping ship to the rival LIV Golf circuit.

However, captain Trevor Immelman of South Africa instead chose the lower ranked Christiaan Bezuidenhout (16th) of South Africa, Pendrith (18th), South Korea’s Kim Si-woo (20th) and Australia’s Cameron Davis (25th).

“I certainly wanted to be on that team but also I understood the picks,” said Hughes, who lives in Charlotte and plays at Quail Hollow regularly. “I think that like a lot of guys that don’t get picked you more so look back on your own play and I wish I had made that selection easier for them.

“I didn’t do myself any favours in the six weeks leading up to it and that’s a hard pill to swallow.”

It may have been a costly oversight on Immelman’s part, as finishing holes was an issue for the International team in 2022 and Hughes is one of the best putters on the PGA Tour. This season he’s third in shots gained around the green and fifth in shots gained from putting.

“It doesn’t mean that just because I was there it would have turned the tide, but I’d like to think maybe I could have helped,” said Hughes. “That’s why you play the matches. You have to get out there and do it.”

This year Hughes made it easier for Weir, the Canadian golf legend from Brights Grove, Ont., to choose him. Hughes is 51st in the FedEx Cup Fall standings and has made the cut seven tournaments in a row, including a tie for fourth at last week’s Procore Championship.

“Mac played very solidly all year. Really like his short game, an all-around short game,” said Weir on Sept. 3 after announcing his captain’s picks. “He’s one of the elite and best short game guys on the PGA Tour

“I also love Mac’s grit. So that was the reason I picked him.”

Hughes’s intangible qualities go beyond grit.

He, Pendrith and Conners will arrive at Royal Montreal as a unit within the International squad, having become close friends while playing on Kent State University’s men’s golf team before turning pro. They’re also part of a group of Canadians, including Nick Taylor and Adam Hadwin of Abbotsford, B.C., that regularly practice together before PGA Tour events.

“To have those guys with me is really icing on the cake, it’s very special,” said Hughes. “Opportunities like this don’t come around very often: to play this kind of team competition, which is already hard to do, but to play with some of your best friends, it almost seems scripted.”

An 11-year professional, Hughes has also been a member of the PGA Tour’s player advisory council the past two years and has been an outspoken advocate for making professional golf more accessible to fans.

Although Weir relied heavily on analytics to make his captain’s selections, Hughes’s character came up again and again when asked why he was named to the team.

“I just have a gut feeling with Mac that he has what it takes in these big moments,” said Weir. “They’re big pressure moments, and I have a feeling he’s going to do great in those moments.”

DP WORLD TOUR — Aaron Cockerill of Stony Mountain, Man., continues his chase for a spot in the Europe-based DP World Tour’s playoffs. The top 50 players on the Race to Dubai standings make the DP World Tour Championship and Cockerill moved eight spots up to 39th in the rankings after tying for ninth at last week’s Irish Open. He’ll be back at it on Thursday at the BMW PGA Championship at the Wentworth Club in Surrey, England.

KORN FERRY TOUR — Myles Creighton of Digby, N.S., is ranked 38th on the second-tier Korn Ferry Tour’s points list. He leads the Canadian contingent into this week’s Nationwide Children’s Hospital Championship. He’ll be joined at Ohio State University Golf Club — Scarlet Course in Columbus, Ohio by Edmonton’s Wil Bateman (53rd), Etienne Papineau (65th) of St-Jean-Sur-Richelieu, Que., and Sudarshan Yellamaraju (99th) of Mississauga, Ont.

CHAMPIONS TOUR — Calgary’s Stephen Ames is the lone Canadian at this week’s Pure Insurance Championship. He’s No. 2 on the senior circuit’s points list. The event will start Friday and be played at Pebble Beach Golf Links and Spyglass Hill Golf Course in Monterey, Calif.

LPGA TOUR — There are four Canadians in this week’s Kroger City Championship. Savannah Grewal (97th in the Race to CME Globe Rankings) of Mississauga, Ont., Hamilton’s Alena Sharp (115th), and Maude-Aimee Leblanc (142nd) of Sherbrooke, Que., will all tee it up at TPC River’s Bend in Maineville, Ohio.

EPSON TOUR — Vancouver’s Leah John is the low Canadian heading into the Murphy USA El Dorado Shootout. She’s 54th in the second-tier tour’s points list. She’ll be joined by Maddie Szeryk (118th) of London, Ont., and Brigitte Thibault (119th) of Rosemere, Que., at Mystic Creek Golf Club in El Dorado, Ark.

This report by The Canadian Press was first published Sept. 18, 2024.

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