Business & Tech

Shirley Leung

Salaries at this Boston company rank among highest in US

01/31/14 - South Boston, MA - Vertex Pharmaceuticals - A bridge connects the two buildings that comprise the new headquarters at Vertex Pharmaceuticals. Vertex Pharmaceuticals Inc. recently moved into its new two-building headquarters on the South Boston waterfront. Topic: 04vertex. Story by Robert Weisman/Globe Staff. Dina Rudick/Globe Staff
Dina Rudick/Globe Staff/file
At Vertex Pharmaceuticals, the median is $211,511.

If you’re feeling underpaid, now you can find out if you are.

For the first time, we have a rough sense of what rank-and-file employees earn at publicly traded companies and how that compares to their chief executives.

It comes from a new Securities and Exchange Commission requirement that took effect in 2017. While the intent was to rein in CEO pay, the biggest impact may be empowering workers with knowledge about salaries at their own companies and elsewhere.


Take a look at the median salaries at some of Massachusetts’ biggest companies as disclosed in SEC filings: At Vertex Pharmaceuticals, the median is $211,511; at Biogen, $148,904; at Raytheon, $144,589; at Eversource Energy, $124,959; at State Street, $85,322; and at TJX Cos., $11,243. (The median is the level at which half the employees earn more and half earn less.)

Get Today's Headlines in your inbox:
The day's top stories delivered every morning.
Thank you for signing up! Sign up for more newsletters here

Sure, we knew biotech and tech paid well, but now we have a better view company by company. In fact, the median salary at Vertex, according to a Wall Street Journal analysis, ranks among the highest in the country, rivaling Facebook at $240,430.

“These numbers are a powerful tool for workers, shareholders, and the public to demand fair pay at individual companies and across the economy,” Senator Elizabeth Warren, who fought for CEO pay ratio disclosure, said in statement.

In years past, shareholders have objected to the outsized pay of Vertex CEO Jeff Leiden, which was boosted by a multimillion-dollar retention bonus. In 2017, Leiden was paid $17.2 million, or about 81 times more than his median employee.

These days, that’s hardly over the top when compared to other companies. For example, Thermo Fisher Scientific’s Marc Casper earned $22.3 million in 2017, or 324 times the median salary at the Waltham life sciences firm, and TripAdvisor CEO Stephen Kaufer made $47.9 million, or 481 times the median salary at the Needham tech company.


Vertex spokeswoman Heather Nichols attributed the Boston biotech’s high salaries to the fact that about 60 percent of employees work in research and development, where advanced degrees and high skills are expected. Employees also receive stock as part of their compensation, and shares of the Boston biotech doubled in 2017.

“Our talented and highly motivated employees are one of the major reasons for our unique success — three breakthrough medicines approved and to patients in 6 years, which has rarely, if ever, been done before,” Nichols said in a statement.

The data aren’t perfect because companies may be using different methodologies to come up with a median salary. Plus, in an industry like retail, the ratio can be skewed because the median employee is likely working only part time; ditto for a company with a large number of workers overseas (where wages can be lower).

Still, the CEO pay ratio could be a predictor of how well a company can perform. One study done by investment research firm MCSI found that companies with larger CEO-to-employee pay gaps experienced lower profitability than peers with smaller pay gaps. One argument: If workers know they’re being paid fairly, morale is better, and they’ll do better work.

Socially responsible investors and consumers could also decide that a company with a high CEO pay ratio — say, over 250 to 1 — isn’t one they should support.


The new rule is “both about reining in pay at the top and lifting pay at the bottom,” said Sarah Anderson, global economy project director at the Institute for Policy Studies, a progressive think tank in Washington. “It’s a big step forward. It will spark a lot of conversations about the American business model and these extreme gaps, and whether this is good for democracy and our economic health.”

Corporate America and Republicans tried to eliminate the CEO pay ratio rule, which was part of the Dodd-Frank law, a sweeping set of regulations created to reduce risky behavior that led to the 2008 financial crisis.

The SEC has long required public companies to disclose the compensation of their CEOs and other high-ranking executives. Now companies must also calculate the median salary, as well as express that as a ratio of CEO pay. (If you want to do some of your own research, Bloomberg has set up a database that can be found at )

Looking at this year’s disclosures, have companies been sufficiently shamed by how much they are paying their CEO compared to their employees?

Depends on whom you ask.

Pearl Meyer, an executive compensation consulting firm, sifted through nearly 2,000 filings and found that the average CEO pay ratio to median employee was 150 to 1, while the average median employee pay is about $80,000.

“That’s not crazy,” said Deborah Lifshey, managing director of Pearl Meyer, which has an office in Wellesley.

But an analysis done by the office of Minnesota Representative Keith Ellison, to be released on Wednesday, reveals a sizable disparity when examining the filings of the big companies that make up the Fortune 500.

Ellison, who championed the CEO pay ratio rule, compiled a database from the first 225 Fortune 500 companies to file their proxy statements this year and found that the average CEO pay to median employee ratio was 339 to 1. The median worker at most of the companies in the database would need to work at least one 45-year career to earn what the CEO makes in a single year.

If you’re wondering what Barney Frank — the retired Newton congressman and coauthor of the eponymous Dodd-Frank law with then-senator Christopher Dodd of Connecticut — thinks about the disclosures, well, it’s not hard to elicit an opinion from him.

“The basic point is that they pay themselves more than they can justify,” Frank told me. “The amount people are getting paid has nothing to do with compensation. It has to do with stature. . .  . ‘We pay our CEO more than you pay your CEO.’ ”

Not everyone thinks the pay ratio disclosure alone will usher in an era of fair pay. In fact, much more needs to be done.

“For politicians, this was a missed opportunity,” wrote Ethan Rouen, an assistant professor at Harvard Business School, in an e-mail.

Rouen, who did his dissertation on the CEO pay ratio rule, argues that politicians should have focused on getting disclosures on the gender pay gap, or the racial pay gap, which would have gone a long way to fight worker inequities.

It’s not too late. Perhaps can we can start after the midterms.

Jon Chesto of the Globe staff contributed to this report. Shirley Leung is a Globe columnist. She can be reached at Follow her on Twitter @leung.