Skip to content

Remuneration and employee participation

Remuneration within companies has become a political issue; politicians are responding with legal acts. This means that the regulatory requirements relating to the remuneration systems for staff, managing directors and board members have been constantly increasing on national and international levels for several years. While international companies endeavour to structure their remuneration systems and incentive plans in a uniform way at a global level, the terms & conditions of these systems and plans are being treated by courts as general terms and conditions of business and are thus being subjected to corresponding controls. Remuneration systems are subject to comprehensive disclosure requirements.

The development of remuneration systems that are both lawful and reasonable requires detailed knowledge of the regulatory environment and past rulings, as well as inside knowledge of standard industry procedures. Corresponding forensic experience is also required when it comes to defending against unjustified claims. In the case of global systems, knowledge of the legal and tax requirements in all countries involved is necessary, together with an ability to combine these in order to create a reasonable whole. Allen & Overy's global Employment & Benefits Group represents a decisive advantage for our clients in this regard.

At the interface with questions relating to corporate governance, which are often raised in connection with the remuneration of managing directors and board members, the lawyers in our German Employment & Benefits practice group often form interdisciplinary teams with corporate law colleagues in order to provide national and international companies with the best possible solution.