There was a sharp increase during the last three months in the number of companies that froze salaries and added clawback policies to their executive pay programs. Clawback policies — also called compensation recovery policies — allow companies to take back previously earned income from executives.
The survey, conducted by consulting firm Watson Wyatt, shows that the percentage of respondents that have frozen salaries has jumped to 55 percent from 21 percent in December. Nearly half of respondents plan to decrease his year’s bonus pool by an average of about 40 percent. And, 23 percent of those responding have added a clawback policy.