Sector: Industrials
PAYCOM SOFTWARE INC · Meeting: May 4, 2026
Directors FOR
0
Directors AGAINST
2
Say on Pay
FOR
Auditor
FOR
Election of Two Class I Directors
Against Analysis
Ms. Turney has served since 2021, meaning her full tenure overlaps with Paycom's severe stock underperformance — the stock lost 55.8% over three years while the peer group median fell only 3.8%, a gap of 52 percentage points that far exceeds the 20-point threshold required to trigger a vote against; the five-year record is equally poor (Paycom down 66.5% vs. peers down 38.9%), so no long-term mitigant applies.
Mr. Watts has served since 2016, so his tenure fully overlaps with Paycom's prolonged stock underperformance — the stock lost 55.8% over three years while the compensation peer group median fell only 3.8%, a gap of 52 percentage points that far exceeds the 20-point trigger threshold; the five-year comparison is equally problematic (Paycom -66.5% vs. peers -38.9%), providing no mitigating long-term track record.
For Analysis
Both Class I director nominees are subject to an AGAINST vote because Paycom's stock has dramatically underperformed its own disclosed compensation peer group over both three and five years, with the stock down 55.8% versus the peer median of -3.8% over three years — a 52-percentage-point gap that far exceeds the 20-point policy threshold applicable when a company's absolute three-year return is negative. The five-year comparison provides no relief (Paycom -66.5% vs. peers -38.9%). Both directors have served long enough that their tenures fully overlap the underperformance period.
CEO
Chad Richison
Total Comp
$22,837,152
Prior Support
91.4%%
The prior year say-on-pay vote received 91.4% support, well above the 70% threshold that would require a response, and the compensation committee has actively engaged with shareholders and made meaningful changes in response to prior feedback. The CEO's 2025 total compensation of approximately $22.8 million is structured with over 95% allocated to variable, at-risk incentives (performance stock awards, time-based stock awards, and annual cash incentive), which satisfies the policy requirement that at least 50-60% of pay be performance-linked; the annual incentive paid out at maximum (200%) because the company hit the top revenue target ($2.05 billion actual vs. $2.04 billion maximum threshold), and performance stock awards paid out at target (100%) based on full-year revenue results, representing genuine pay tied to disclosed financial outcomes. The compensation structure includes a meaningful clawback policy, stock ownership requirements (6x salary for CEO), and independently benchmarked pay levels, all of which are positive governance features that support a FOR vote despite the company's stock price underperformance.
Auditor
Grant Thornton LLP
Tenure
17 yrs
Audit Fees
$1,284,000
Non-Audit Fees
$369,000
Grant Thornton's non-audit fees (audit-related fees of $250,000 plus tax fees of $119,000 totaling $369,000) represent about 29% of core audit fees ($1,284,000), well below the 50% threshold that would raise independence concerns; auditor tenure is approximately 17 years (since 2009), which is below the 25-year threshold that would trigger a concern; no material restatements are disclosed; and Grant Thornton is a large national firm appropriate for a company of Paycom's size and complexity.
Paycom's 2026 annual meeting ballot contains three proposals: the company's pay program earns a FOR on say-on-pay given strong shareholder engagement, high prior-year support, and a genuinely at-risk incentive structure tied to disclosed revenue targets, while the auditor ratification also passes with no fee ratio or tenure concerns. However, both Class I director nominees — Sharen Turney and J.C. Watts — receive an AGAINST vote because Paycom's stock has lost 55.8% over three years while the compensation peer group median fell only 3.8%, a 52-percentage-point gap that far exceeds the policy's 20-point trigger threshold for companies with negative absolute returns, and the five-year record provides no mitigating improvement.
19 companies disclosed in 2026 proxy filing
