T-Mobile has highest CEO-to-worker pay ratio

How much is a good CEO worth? In the world of publicly traded U.S. companies, the answer to that question almost always has seven or eight digits. Public companies have been required for years to disclose CEO pay, but this year the Dodd-Frank Act has added a new requirement: Companies must now report the ratio of the CEO's pay to median employee pay.

Among U.S. carriers, T-Mobile's John Legere topped the chart as the CEO whose pay was the highest compared to median employee pay. He made $23,636,334, while the company's median employee salary was $55,739 in 2017. T-Mobile's CEO-to-worker ratio was 424-to-1.

To be clear, Legere has overseen T-Mobile's transformation from a last-place nationwide carrier to a very strong No. 3 provider that is now positioned to purchase Sprint. T-Mobile's turnaround was helped by a hefty breakup fee and roaming agreement with AT&T that it got when AT&T had to walk away from a 2011 takeover bid, but Legere and his larger-than-life public persona have also played a big part in T-Mobile's success.

T-Mobile had the highest CEO-to-worker pay ratio, but that doesn't mean its CEO got paid the most. AT&T's Randall Stephenson was paid $28,720,720. AT&T did not report its median employee salary, but its reported ratio of 366-to-1 implies a median employee salary of $78,472.

Verizon reported a median employee salary of $126,623, which the carrier calculated including retirement plan contributions and accrued pension benefits. Verizon CEO Lowell McAdam's total compensation was lower than that of some competitors at $17,947,316, and Verizon's overall ratio was 142-to-1.

U.S. Cellular's ratio was very close to Verizon's at 131-to-1. U.S. Cellular's CEO compensation was $7,812,357, and its median employee salary was $59,545. The company said that it actively monitors the relationship between executive and nonexecutive pay.

Sprint has not yet filed a proxy statement for 2018, so its ratio is not available.

Not all companies calculate the median employee compensation in the same way. For example, T-Mobile did not annualize the salaries of people who only worked there for part of the year, but Verizon did. This is part of the reason there's such a difference between the two companies' salary figures. 

Among the publicly traded tower companies, American Tower had the highest CEO-to-worker pay ratio at 260-to-1. More than two-thirds of its employees are located outside the United States. The company has tower portfolios in India, Brazil and Mexico. CEO James Taiclet's compensation was $13,119,417.

Crown Castle reported a much lower ratio: 87-to-1. The company notes that it calculated employee compensation by including commissions, incentive pay and restricted stock units. Its median employee compensation was $106,562, and CEO Jay Brown's total compensation, calculated the same way employee compensation was calculated, was $9,272,616.  

SBA's ratio, 130-to-1, was higher than Crown's but lower than American Tower's. CEO Jeffrey Stoops made $8,205,344, while the median employee compensation was $62,949.

Article updated May 8 with additional context.