What public waste CEOs earned vs. median workers in 2018

Amid a tight labor market in the waste and recycling industry, discussions about making pay more competitive in order to attract workers have become increasingly common — but compared to other sectors, there's been less public attention devoted to exactly how much top executives at these companies are earning themselves.

Recently-filed Securities and Exchange Commission (SEC) proxy statements by the U.S. industry's five primary publicly-traded waste companies offer fresh insight into the situation. While full 2018 analysis isn't available for publicly-traded companies across all sectors, 2017 reports offer a benchmark for understanding how U.S. waste industry leaders stack up against their counterparts.

According to the Economic Policy Institute, when factoring in the value of stock options, CEO pay in 2017 averaged out to $13.3 million. Separate 2017 analysis by Institutional Shareholder Services determined average CEO pay at S&P 500 companies to be $13.6 million.

Compared to executives at other public companies — some bigger, some smaller — the five men on this list aren't the highest earners out there. Still, their seven-figure-plus salaries secure this group a place among the highest income echelons in the country.

CEO Compensation

The following compensation breakdowns are ranked in order of total company revenue. Despite its planned acquisition by Waste Management, Advanced Disposal Services has been included for historical comparisons.

Waste Management President and CEO Jim Fish

Base salary: $1,157,692
Value of combined stock awards, option awards, non-equity incentive plan compensation and all other compensation: $7,967,589
Total 2018 compensation: $9,125,281
Total 2017: $8,994,105
Total 2016: $5,226,858

Republic Services President and CEO Don Slager

Base salary: $1,134,327
Value of stock awards, non-equity incentive plan compensation and all other compensation: $10,653,244
Total 2018 compensation: $11,787,571
Total 2017: $11,549,710
Total 2016: $12,917,801

Waste Connections CEO and Chairman Ron Mittelstaedt

Base salary: $946,638
Value of share-based awards, non-equity incentive plan compensation and all other compensation: $12,745,645
Total 2018 compensation: $13,692,283
Total 2017: $5,441,774
Total 2016: $4,974,513

Covanta President and CEO Steve Jones

Base salary: $800,000
Value of stock awards, non-equity incentive plan compensation and all other compensation: $3,839,255
Total 2018 compensation: $4,639,255
Total 2017: $4,375,800
Total 2016: $3,284,125

Advanced Disposal Services CEO Richard Burke

Base salary: $775,000
Value of stock awards, option awards, non-equity incentive plan compensation and all other compensation: $2,776,039
Total 2018 compensation: $3,551,039
Total 2017: $3,811,222
Total 2016: $5,625,974

Casella Waste Systems Chairman and CEO John Casella

Base salary: $535,500
Value of stock awards, non-equity incentive plan compensation and all other compensation: $1,987,303
Total 2018 compensation: $2,522,803
Total 2017: $2,885,473
Total 2016: $3,273,022

Worker Pay Ratios

Mandated in 2010 by the Dodd-Frank Act and approved by the SEC in 2015, the "CEO pay ratio" provision ostensibly serves as a check on corporate opacity. Effective for public companies with fiscal years ending on or after December 31, 2017, the rule requires companies to disclose a ratio comparing CEO compensation to the pay of their median employee.

Early 2018 disclosures revealed a sweeping landscape of often stark corporate income inequality: according to a March 2018 analysis of 150 companies by Compensation Advisory Partners, median pay ratio across companies with a median revenue of $2.1 billion was 87:1. An Economic Policy Institute analysis of the 350 largest publicly-traded companies found a ratio of 312:1 in 2017 filings — below a peak of 344:1 in 2000, but exponentially higher than the 20:1 ratio of 1965. Overall, according to the AFL-CIO's Executive Paywatch tracker, S&P 500 pay ratios can range from as high as 4,987:1 to as low as 1:1

Critics, however, point to these "dubiously low" 1:1 ratios as evidence of the rule's intrinsic weaknesses. Opportunities for flexible and inconsistent methodologies abound, according to experts: the SEC allows companies to employ statistical sampling methods and estimates in calculating median employee pay, resulting in potentially imprecise ratios. Companies aren't required to factor dividends into their calculation of CEO pay — a considerable loophole for private equity firms, where the vast majority of top executives' income is derived from dividends on partnership equity (private equity juggernauts Apollo Global Management and The Carlyle Group, for instance, both reported 1:1 ratios in 2017).

In addition, the rule permits employers to exclude independent contractors and up to 5% of their overseas workforce — a departure, noted AFL-CIO Office of Investment Director Heather Slavkin Corzo to CFO magazine, from Dodd-Frank's original statute, which mandates "disclosure of the median of the annual total compensation of all employees of an issuer."

Factoring in all those caveats, here's the breakdown for the top five waste industry companies:

Waste Management

Compensation for 2018 median employee ("a driver in the United States"): $81,096
Calculations excluded employees in India and all subcontractors, included temporary and seasonal workers
Pay ratio compared to CEO — 113:1

Republic Services

Compensation for 2018 median employee: $64,257
Pay ratio compared to CEO — 183:1

Waste Connections

Compensation for 2018 median employee ("a commercial truck driver"): $54,624
Pay ratio compared to CEO — 250:1
Pay ratio compared to CEO, when excluding $9.1 million retention equity award — 83:1

Covanta

Compensation for 2018 median employee ("a full-time hourly Operator of one of our subsidiaries in the Operations Department"): $101,625
Pay ratio compared to CEO — 46:1
Calculations excluded international employees, included temporary workers