Even in the midst of the COVID-19 pandemic, the highest paid CEOs in Canada are on track to earn more than an average worker’s entire yearly salary before noon today.
The eye-popping claim comes from an annual report released Monday from the Canadian Centre for Policy Alternatives, an Ottawa-based think tank that champions labour issues and opposes inequality.
By tabulating data from companies that trade on the TSX, the group calculated that in 2019, the average total compensation for the 100 best-paid CEOs in Canada was $10.8 million. In contrast, the average annual salary for a Canadian worker that year was $53,482, according to Statistics Canada.
At those rates, a top Canadian CEO will earn the annual salary of a typical worker at their company by 11:17 a.m. today.
That’s actually a little over an hour later than was the case the year before, when the average CEO took in $11.8 million annually — 227 times more than the typical worker’s pay packet.
The CCPA used 2019 data because full numbers for 2020 wont be available until the spring. Early estimates show that roughly half of top paid CEOs will likely keep or even increase their compensation levels, due to the stock market boom during the pandemic.
“The pandemic has not been bad for everyone,” report author David MacDonald said. “At the very top of the income spectrum, Canada’s highest paid CEOs have been sitting through it atop a golden cushion bolstered by years of out of control rates of executive pay.”
One of the issues that MacDonald takes with executive compensation is that most of it, at the high end, doesn’t come in the form of salaries which are taxed the same way everyone’s are, but rather is mainly given through stock-based awards that allow the receiver to retain a lot of more of it. “It seems only fair that whether a person earns an income working or when they sell stock, the tax system should treat that individual income the same,” he said in the report.
MacDonald tabulated that more than a third of the CEOs on the highest paid list work for companies that signed up for CEWS, the governments wage subsidy program that at one point picked up the tab for up to 75 per cent of a worker’s salary.
CBC has reported on dozens of companies that continued to pay out generous dividends to shareholders while simultaneously receiving the wage subsidy.
MacDonald suggests that Ottawa should tweak the CEWS rules so that companies that increase payments to executives or shareholders while on it are excluded, which countries including Spain and the Netherlands have done.
Based on regulatory data, the top paid CEO of a Canadian company was Jose Cil, CEO of Restaurant Brands, which owns Tim Hortons, Burger King, Popeye’s and other chains. Cil’s total compensation was more than $27 million in 2019, which came mostly in the form of stocks on top of his base salary of just over $1 million.
Tim Hortons was one of 36 companies that used CEWS during the pandemic.
The report also found that there were as many people with the first name Paul as there were women on the CEO list: four of each.