Unless otherwise indicated, all shares listed as beneficially owned are held with sole voting and dispositive power.

Anti-Hedging Policy

The Company has adopted an Anti-Hedging Policy, which is applicable to the Company’s directors and executive officers, and prohibits them from directly or indirectly engaging in hedging against future declines in the market value of any Company securities through the purchase of financial instruments designed to offset such risk. Executive officers and directors who fail to comply with the policy are subject to Company-imposed sanctions, which may include a demotion in position, reduced compensation, restrictions on future participation in cash or stock incentive plans, or termination of employment.  The Company’s Anti-Hedging Policy is available on the Company’s website at www.mybbsi.comwww.BBSI.com in the "Investors" section under “Governance.”

Delinquent Section 16(a) Reports

Section 16 of the Exchange Act ("Section 16") requires that reports of beneficial ownership of Common Stock and changes in such ownership be filed with the SEC by Section 16 "reporting persons," including directors, executive officers, and certain holders of more than 10% of the outstanding Common Stock. To the Company's knowledge, based solely on a review of the copies of Forms 3, 4, and 5 (and amendments thereto) filed with the SEC and written representations by the Company's directors and executive officers, all Section 16 reporting persons complied with all applicable Section 16(a) filing requirements during 20192020 on a timely basis, except (i) Messrs. Elich, Kramer, BlotzAnthony Meeker, a director, filed one late Form 4 reporting the exercise of options and Vaughn, eachsale of the shares, (ii) Anthony Harris filed his initial Form 3 late following his election as an executive officer, and (iii) Heather Gould, a former executive officer, filed one late Form 4 reporting the vesting of performance shares and (ii) Diane Dewbrey, a director, filed one late Form 4 reporting the grant of an RSU award.awards.

Stock Ownership Guidelines for Non-Employee Directors and Executive Officers

The Board has adopted stock ownership guidelines such that each non-employee director is expected to own shares of Common Stock with a value equal to at least three times the regular annual cash retainer, currently $60,000, within three years of first being elected. The value of shares owned is calculated quarterly based on the higher of current market price or the average daily closing price for the preceding 12 months. Any shortfall resulting from an increase in the annual cash retainer or a decrease in the stock trading price (or both) is expected to be cured within two years following the end of the quarter in which the resulting required increase in share ownership first occurred.  

The Board also adopted a policy on stock ownership for the Company's executive officers. Under the policy, executive officers will have five years from the later of July 1, 2016, and the date the officer is notified of his or her selection, to achieve and maintain ownership of shares of Common Stock with a value equal to at least three times the officer's annual base salary. Shares will be valued at the greater of the then current market price and the original purchase price. Until the minimum ownership level is reached, the officer is expected to retain at least 50% of the shares of Common Stock received upon exercise of an option or vesting of RSUs and performance shares, after payment of the exercise price and withholding and payroll taxes. Participants who are not in compliance will not be permitted to sell or dispose of shares, except as described in the preceding sentence, until they reach the required ownership level. The Nominating Committee may make an exception in its sole discretion in the case of financial hardship.

ITEM 2 - APPROVAL OF AN AMENDMENT TO THE COMPANY’S BYLAWS PROVIDING PROXY ACCESS IN THE ELECTION OF DIRECTORS

The Board recommends that stockholders adopt an amendment to the Company’s Bylaws (the “Bylaws”) to provide for proxy access in the election of directors. The proposed amendment (the "Proxy Access Bylaw") would be added to Article I of the Bylaws as Section 1.12, a copy of which is attached to this proxy statement as Appendix A. The following description of the Proxy Access Bylaw is qualified in its entirety by reference to Appendix A.

Purposes and Effects of the Proxy Access Bylaw

At the Company’s annual meeting of stockholders held in May 2019, holders of a majority of the shares voting on a stockholder proposal regarding proxy access voted in favor of the proposal calling for the Board to draft, adopt and submit a proxy access bylaw to a vote of the stockholders. After considering various factors with respect to the implementation of proxy access, the Board approved the Proxy Access Bylaw and directed its submission to a vote of the stockholders at this Annual Meeting. If approved by the affirmative vote of a majority of all shares of our Common Stock entitled to vote at the Annual Meeting, the Proxy Access Bylaw will become effective as of the date of the Annual Meeting. The Proxy Access Bylaw would provide an additional means for the Company’s stockholders to nominate a director candidate for election to our Board. Eligible stockholders who comply with the requirements set forth in the Proxy Access Bylaw would be able to include their own nominees for director in the Company’s proxy materials, together with candidates nominated by the Board.

Vote Required and Board Recommendation

The proposal must be approved by the affirmative vote of a majority of all shares of our Common Stock entitled to vote at the Annual Meeting.  Abstentions and broker non-votes will have the effect of votes against the proposal.

The Board unanimously recommends a vote FOR Item 2 to APPROVE amendment of the Bylaws to include the Proxy Access Bylaw.

Summary of the Proxy Access Bylaw

Eligibility of Stockholders to Nominate Directors. A stockholder or group of up to 20 stockholders (such stockholder or stockholder group, an “Eligible Stockholder”) that has maintained continuous qualifying ownership of 3% or more of the outstanding Common Stock for at least the previous three years would be permitted to nominate and include up to a specified number of proxy access nominees in the Company’s proxy materials for its annual meeting of stockholders; provided that the eligible stockholder and proxy access nominee(s) satisfy all applicable requirements of the Bylaws.

Calculation of Qualifying Ownership. To ensure that the interests of stockholders seeking to include proxy access nominees in the Company’s proxy materials are aligned with those of other stockholders, an eligible stockholder will be deemed to own only those outstanding shares of Common Stock as to which the eligible stockholder possesses both (1) the full voting and investment rights pertaining to the shares and (2) the full economic interest in (including the opportunity for profit from and risk of loss on) such shares. The following shares would not count as “owned” shares for purposes of the Proxy Access Bylaw:

Required Information and Supporting Statement. Each eligible stockholder seeking to include a proxy access nominee in the Company’s proxy materials would be required to provide certain information to the Company, including, but not limited to:

Eligible stockholders would also be required to make certain representations and undertakings to the Company, including, but not limited to:

Eligible stockholders would be permitted to include in the proxy statement a statement, not to exceed 500 words, in support of each proxy access nominee. The Company may omit any information or statement that it, in good faith, believes is untrue in any material respect, omits a material fact necessary in order to make the information, in light of the circumstances, not misleading, or would violate any applicable law or regulation. The Company may solicit against and include in the proxy statement its own statement relating to any proxy access nominee.

Number of Proxy Access Nominees. The maximum number of proxy access nominees that the Company would be required to include in its proxy materials would not exceed the greater of (a) two and (b) 20% of the directors in office at the time of nomination (rounded down to the nearest whole number). If the Board decides to reduce the size of the Board after the nomination deadline but before the date of the annual meeting, the proxy access nominee limit would be calculated based on the reduced number of directors. Any director currently serving on the Board who will be included as a management nominee and who was included as a proxy access nominee for either of the two preceding annual meetings, and any proxy access nominee who is either subsequently withdrawn or included in the Company’s proxy materials as a nominee of the Board, would not be counted against the proxy access nominee limit.

Nominating Procedure. In order to provide adequate time to assess proxy access nominees, requests to include proxy access nominees in the Company’s proxy materials must be received no earlier than 120 days and no later than 90 days before the anniversary of the date that the Company first mailed its proxy materials for the preceding year’s annual meeting of stockholders, subject to adjustment in the event the annual meeting is held more than 30 days before or after the anniversary of the date of the prior year’s annual meeting.

Procedure for Selecting Proxy Access Nominees if Nominee Limit is Exceeded. Any eligible stockholder that submits more than one proxy access nominee would be required to provide a ranking of its proposed proxy access nominees. If the number of proxy access nominees exceeds the proxy access nominee limit, the highest ranking qualified individual from the list proposed by each eligible stockholder, beginning with the eligible stockholder with the largest qualifying ownership and proceeding through the list of eligible stockholders in descending order of qualifying ownership, would be selected for inclusion in the Company’s proxy materials until the proxy access nominee limit is reached.

Information Required of all Proxy Access Nominees. Each proxy access nominee would be required to make certain written representations to and agreements with the Company, including, but not limited to:

Proxy access nominees would also be required, at the request of the company, to submit completed and signed questionnaires required of company directors and officers and provide any additional information necessary for the board’s independence evaluation and determination.

Exclusion and Future Disqualification of Proxy Access Nominees. The Company would not be required to include a proxy access nominee in the Company’s proxy materials if, among other things:

In addition, the Board or the chairman of the annual meeting will declare a proxy access nomination by an eligible stockholder to be invalid, and such nomination will be disregarded, if (1) the proxy access nominee or the eligible stockholder breaches any of their respective obligations under the Bylaws or (2) the eligible stockholder does not appear at the annual meeting in person or by proxy to present the nomination.

Any proxy access nominee who is included in the Company’s proxy materials but subsequently either (1) withdraws from or becomes ineligible or unavailable for election at the annual meeting, or (2) does not receive the affirmative vote of at least 25% of the shares represented in person or by proxy at such meeting and entitled to vote in the election of directors would be ineligible for nomination for the following three annual meetings.

ITEM 3 – APPROVAL OF 2020 STOCK INCENTIVE PLAN

The Board adopted the Barrett Business Services, Inc., 2020 Stock Incentive Plan (the "2020 Plan") on April 22, 2020.  The 2020 Plan is subject to stockholder approval at the Annual Meeting.  If approved, the 2020 Plan will become effective as of the date of the Annual Meeting and will serve as successor to the Company's 2015 Stock Incentive Plan (the "2015 Plan"), which will expire on May 27, 2020.  Below is a summary of the principal provisions of the 2020 Plan and its operation.  A copy of the 2020 Plan is set forth in full in Appendix B to this Proxy Statement, and the following description of the 2020 Plan is qualified in its entirety by reference to Appendix B.

Purposes and Effects of the 2020 Stock Incentive Plan

We have historically maintained a stock-based compensation program for the benefit of our employees, directors and consultants.  The Board believes that stock-based incentives are essential to attract and retain the services of individuals who are likely to make significant contributions to our success and to promote success by providing rewards for exceptional service and long-term incentives for future contributions to the Company.  Stock-based awards also encourage ownership of Common Stock by our directors, executive officers, and other employees.

The Board adopted the 2020 Plan to provide the overall structure for future awards of stock-based incentive compensation.  The 2020 Plan will serve as successor to the 2015 Plan.  As described under "Executive Compensation" below, our long-term incentive program for executive officers has consisted of awards under the 2015 Plan and its predecessors.  Such awards have included stock options, restricted stock units ("RSUs"), and performance shares.  As of April 15, 2020, there were 470,871 shares available for future awards under the 2015 Plan but, as noted above, the 2015 Plan will expire on the date of the Annual Meeting.  Additional information regarding outstanding stock-based awards under the 2015 Plan and earlier plans appears below under "Information Regarding Outstanding Stock-Based Awards."

If the 2020 Plan is approved at the Annual Meeting, all stock-based awards previously granted under the 2015 Plan will remain outstanding until exercised or terminated and will be subject to the terms of the 2015 Plan.  However, no new awards will be granted under the 2015 Plan, and the 2020 Plan will be used thereafter.  If the 2020 Plan is not approved at the Annual Meeting, the Company will be precluded from granting stock-based awards as part of its executive compensation program unless the Company's stockholders approve a different stock-based compensation plan at a future meeting.

Important Features of 2020 Stock Incentive Plan

As described in more detail below, the 2020 Plan includes several features intended to enhance long-term stockholder interests:

Vote Required and Board Recommendation

The affirmative vote of a majority of the votes cast on Item 3 is required for approval.  Abstentions and broker non-votes will have no effect on the outcome of the vote.

The Board of Directors unanimously recommends that you vote FOR approval of the Barrett Business Services, Inc., 2020 Stock Incentive Plan.

SUMMARY OF THE 2020 STOCK INCENTIVE PLAN

Administration

Except to the extent the Board determines otherwise, the 2020 Plan will be administered by the Compensation Committee (referred to in this section as the "Committee").  Under its charter, the Committee must consist of three or more directors of the Company, each of whom satisfies the applicable independence criteria of the stock exchange or quotation system on which the Company's common stock is listed or quoted and qualifies as a "non-employee director" as defined by Rule 16b-3 promulgated under the Exchange Act.

Eligibility.  Employees, including employees who may also be directors, non-employee directors, and outside consultants are eligible to receive awards under the 2020 Plan.  Individuals who receive awards are referred to as "Participants."  As of April 15, 2020, seven non-employee directors, three executive officers, and approximately 690 other employees were considered to be eligible to receive awards under the 2020 Plan, assuming its approval by the stockholders. Compensation paid to the Company's non-employee directors in any calendar year may not exceed a total of $400,000 per director, including all cash compensation and the value of all awards granted under the 2020 Plan.

Shares Available for Issuance under the 2020 Plan.  A maximum of 375,000 shares of Common Stock may be made the subject of awards granted under the 2020 Plan.  This amount will be adjusted in the event of certain changes in the Company's capitalization.

If an award is canceled or expires for any reason before having been fully vested or exercised, or is exchanged for another award, or is otherwise forfeited, all shares covered by such award will be added back to the number of shares available for future awards.  The shares subject to awards that are payable or settled solely for cash also will not reduce the number of shares available for future awards.  In no event will any of the following shares again become available for other awards:  (i) shares tendered or withheld in respect of taxes; (ii) shares tendered or withheld to pay the exercise price of options; (iii) shares repurchased by the Company from a Participant with the proceeds from the exercise of options; and (iv) the total number of shares underlying exercised stock appreciation rights, not just the net number of shares issued.

The 375,000 shares that will be authorized for issuance under the 2020 Plan represent approximately 5.0 percent of outstanding shares as of April 15, 2020.

The 2020 Plan is separate from the 2015 Plan, and the adoption of the 2020 Plan neither affects nor is affected by the 2015 Plan, except that no further awards will be granted under the 2015 Plan after the effective date of the 2020 Plan.  

Duration of the 2020 Plan.  The 2020 Plan will terminate ten years after its effective date or, if earlier, when all awards have been granted covering all available shares or the plan is otherwise terminated by the Board.  Termination of the 2020 Plan will not affect outstanding awards.

Description of Awards under the 2020 Plan.  The Committee may make awards to eligible Participants of incentive stock options ("ISOs"), non-qualified stock options ("Nonqualified Options"), stock appreciation rights ("SARs"), restricted shares ("Restricted Shares"), restricted stock units ("RSUs"), and performance shares.  The general terms of such awards are summarized below.  Each award will be evidenced by a written agreement between the Company and the Participant with such terms and conditions as are approved by the Committee in its discretion, subject to the provisions of the 2020 Plan.

Stock Options.  Options granted under the 2020 Plan provide Participants with the right to purchase shares at a predetermined exercise price.  The Committee may grant ISOs or Nonqualified Options.  Each award agreement will state the option exercise price per share of common stock purchasable under each option, which may not be less than 100 percent of the fair market value of a share on the date of grant.  The applicable award agreement will specify when the option becomes exercisable, which may be in full or in installments based on continuation of employment over a specified period, satisfaction of performance goals, or other criteria.  No option may be exercised after the expiration of its term, which may be no longer than ten years from the date of grant.  The Committee will determine the terms of each ISO or Nonqualified Option at the time of grant.

Special rules apply for ISOs.  The terms of ISOs and the applicable award agreement must conform to the statutory and regulatory requirements of Section 422 of the Internal Revenue Code of 1986 (the "Code").  ISOs may only be granted to employees of the Company or its subsidiaries.  The maximum number of shares as to which ISOs may be granted under the 2020 Plan is 375,000.

SARs.  A SAR is an award entitling a Participant to receive an amount equal to the excess (or, if the Committee determines at the time of grant, a portion of the excess) of the fair market value of a share of Common Stock on the date of exercise of the SAR over the base price multiplied by the number of shares as to which the SAR is being exercised.  The base price may not be less than 100 percent of the fair market value of a share on the date of grant.  Upon the exercise of a SAR, payment may be made in cash, shares of Common Stock, or in any combination of the foregoing as the Committee may determine.  No stock appreciation right may be exercised after the expiration of its term, which may be no more than ten years from the date of grant.

Restricted Shares.  A Restricted Share is an award of shares to a Participant that is subject to such terms and conditions as the Committee deems appropriate, including, for example, completing a specified number of years of service or attaining specified performance goals.  No cash or other consideration is required to be paid for shares subject to an award of Restricted Shares.  Any portion of an award of Restricted Shares that is not vested because the specified conditions were not met is forfeited.

Restricted Stock Units.  RSUs are units (with each unit having a value equivalent to one share) granted to a Participant on such terms as the Committee may determine, including, for example, a requirement that the Participant forfeit such RSUs upon termination of employment or service as a non-employee director.  Upon vesting of an award of RSUs, the Participant is entitled to receive a payment in an amount equal to the aggregate fair market value of the shares covered by such RSUs at the end of the applicable restriction period.  Payment made be made in unrestricted shares of Common Stock equal to the number of RSUs, in installments, in cash, or in any other manner as determined by the Committee.

Performance Shares.  A performance share represents a right of a Participant to an actual share or a share unit having a value equal to one share of Common Stock.  The Committee will determine whether and to whom performance awards will be granted, the performance goals applicable to each award, the periods during which performance is to be measured, and all other limitations and conditions applicable to the performance shares.  Payment with respect to performance shares will be in cash or in shares of Common Stock as specified in the award agreement.  Following the end of the performance period, a participant holding performance shares will be entitled to receive payment of an amount, not exceeding the maximum value of the performance shares, based on the achievement of the performance goals for such performance period, as determined by the Committee.

Provisions Governing All Awards.  All awards under the 2020 Plan are subject to the following provisions:

Minimum Vesting Period.  No award may vest in whole or in part before the one-year anniversary of the grant of such award; provided that the Committee may grant Awards covering up to five percent of the shares authorized for issuance under the 2020 Plan without regard to the foregoing restriction.  The provision also does not restrict the Committee's authority, in its sole discretion, to accelerate the vesting of, and waive any restrictions applicable to, any outstanding awards.

Performance Goals.  If an award is intended to be performance-based, the Committee will establish performance goals for specific performance periods on the basis of such criteria as the Committee may select, such as performance criteria for the Company, an operating group or a branch, a Participant's individual performance, or a combination of both.  Performance goals may be objective or subjective.

Rights as Stockholders. Participants will have no rights of a stockholder with respect to shares subject to an award until such shares are issued in the name of the Participant, including the right to receive cash dividends or dividend equivalents.  No cash dividends or dividend equivalents will be paid or accrued on Restricted Shares before they vest.  Stock dividends issued with respect to unvested Restricted Shares will be subject to the same restrictions.  Unless the award agreement for Restricted Shares provides otherwise, a Participant will have voting rights with respect to unvested Restricted Shares that have not been forfeited.

Change in Control.  If a change in control of the Company occurs, the Committee has broad discretion to, among other things, accelerate the vesting of outstanding awards, convert or replace outstanding awards, or cancel outstanding awards in exchange for specified payments.  Replacement and converted awards would continue to vest over the period (and at the same rate) as the awards which the replacement or converted awards replaced, unless otherwise determined by the Committee.  The Committee may provide for a 30-day period prior to a change in control during which all outstanding awards will tentatively become fully vested; when the change in control occurs, all outstanding and unexercised awards will then immediately terminate.  Unless the Committee specifically provides otherwise in an award agreement, awards will become vested as of a change in control date only if, or to the extent, such acceleration of vesting does not result in an "excess parachute payment" within the meaning of Section 280G(b) of the Code.  The definition of change in control used in the 2020 Plan is summarized below under "Information Regarding Agreements with Executive Officers."

No Repricing.  No options or SARs may be repriced, replaced, regranted through cancellation, or modified without stockholder approval (except in connection with a change in the Company's capitalization or similar event), if the effect would be to reduce the exercise or base price for the shares underlying the award.

Nontransferability of Awards.  Awards granted under the 2020 Plan are not transferable other than by will or the laws of descent and distribution and may be exercised during the Participant's lifetime only by the Participant.

Clawback of Compensation.  All compensation pursuant to awards granted under the 2020 Plan are subject to recovery under the Company's compensation recovery policy described under "Compensation Recovery (“Clawback”) Policy" below, as well as any future policies that may be adopted by the Company.

Termination of Employment.  The terms and conditions under which an award may be exercised, if at all, after a Participant's termination of employment or service as a non-employee director will be determined by the Committee and specified in the applicable award agreement.

Amendment and Termination.  The Board may amend the 2020 Plan at any time, but no such amendment will be effective unless approved by the Company's stockholders to the extent that such approval is required to satisfy applicable law or securities exchange listing requirements.  The Board may also terminate the 2020 Plan at any time, but termination will not affect outstanding awards.  In addition, an amendment will not materially impair the rights of a Participant with respect to outstanding awards without the Participant's consent, unless the amendment provides for payment of the value of the vested portion of the award to the Participant.

EXPECTED FEDERAL INCOME TAX CONSEQUENCES

The following is a general discussion of certain U.S. federal income tax consequences relating to awards granted under the 2020 Plan.  This discussion is not intended to constitute tax advice, does not address all aspects of U.S. federal income taxation, does not discuss state, local, employment, and foreign tax issues, and does not discuss considerations applicable to a holder who is, with respect to the United States, a non-resident alien.  This summary of federal income tax consequences does not purport to be complete and is based upon interpretations of the existing laws, regulations, and rulings, which could be altered materially with enactment of any new tax legislation.  Participants should consult their own tax advisors because the summary below may not apply to a Participant's particular situation.

Under the Code, the Company will generally be entitled to a deduction for federal income tax purposes at the same time and in the same amount as the ordinary income that Participants recognize pursuant to awards.  For Participants, the expected U.S. federal income tax consequences of awards are as follows:

Nonqualified Options.  A Participant will not recognize income at the time a Nonqualified Option is granted.  At the time a Nonqualified Option is exercised, the Participant will recognize ordinary income in an amount equal to the excess of (i) the fair market value of the shares issued to the Participant on the exercise date over (ii) the exercise price paid for the shares.  At the time of sale of shares acquired pursuant to the exercise of a Nonqualified Option, the appreciation (or depreciation) in value of the shares after the date of exercise will be treated either as short-term or long-term capital gain (or loss) depending on how long the shares have been held.

ISOs.  A Participant will not recognize income upon the grant of an ISO.  There are generally no tax consequences to the Participant upon exercise of an ISO (except that the amount by which the fair market value of the shares at the time of exercise exceeds the option exercise price will be included in the Participant's alternative minimum taxable income).  If the shares are not disposed of within the later of two years from the date the ISO was granted or one year after the ISO was exercised, any gain realized upon the subsequent disposition of the shares will be characterized as long-term capital gain and any loss will be characterized as long-term capital loss.  If either of these holding period requirements are not met, then a "disqualifying disposition" occurs.  Upon a disqualifying disposition, (i) the Participant recognizes ordinary income in the amount by which the fair market value of the shares at the time of exercise (or, if less, the amount realized on the disqualifying disposition) exceeded the exercise price for the ISO and (ii) any excess amount realized on the disqualifying disposition over the fair market value of the shares at the time of exercise will be characterized as capital gain.  If the amount the Participant realizes from a disqualifying disposition is less than the exercise price paid and the loss sustained upon the disposition would otherwise be recognized, the Participant will not recognize any ordinary income from the disqualifying disposition and instead the Participant will recognize a capital loss.

Stock Appreciation Rights.  A Participant will not recognize income at the time of grant of a SAR.  Upon exercise of a SAR, the Participant will recognize ordinary income in an amount equal to the value of any cash or shares that the Participant receives.  At the time of sale of any shares acquired pursuant to the settlement of a SAR, the appreciation (or depreciation) in value of the shares after the date of settlement will be treated either as short-term or long-term capital gain (or loss) depending on how long the shares have been held.

Restricted Shares.  In general, a Participant will not recognize income at the time of grant of Restricted Shares unless the Participant elects with respect to the Restricted Shares to accelerate income taxation to the date of the award, as described further below.  In the absence of an election to accelerate income taxation to the date of an award, upon lapse of the forfeiture conditions or transfer restrictions (the "vesting date"), a Participant will recognize ordinary income equal to the fair market value of the Restricted Shares on the vesting date (less any amount the Participant paid for such Restricted Shares).  If permitted by the applicable award agreement, a Participant may, within 30 days after the date of the grant, elect to immediately recognize (as ordinary income) the fair market value of the Restricted Shares (less any amount the Participant paid for the Restricted Shares), determined as of the date of grant (without regard to the forfeiture conditions and transfer restrictions).  This election is made pursuant to Section 83(b) of the Code.  If a Participant making such an election later forfeits the Restricted Shares, no deduction or capital loss will be available to the Participant (even though the Participant previously recognized ordinary income with respect to such Restricted Shares).

Restricted Stock Units and Performance Shares.  In general, a Participant will not recognize income at the time of grant of RSUs or performance shares.  Upon distribution of cash or unrestricted shares that the Participant receives in settlement of RSUs or performance shares after vesting, a Participant will recognize ordinary income equal to the value of any cash or unrestricted shares that the Participant receives.  At the time of sale of any shares acquired pursuant to the settlement of RSUs or performance shares, the appreciation (or depreciation) in value of the shares after the date of settlement will be treated either as short-term or long-term capital gain (or loss) depending on how long the shares have been held.

Payment of Exercise Price or Tax Withholding in Shares.  The Committee may permit Participants to pay all or a portion of the exercise price of stock options or tax withholding obligations upon exercise or vesting of an award by tendering previously acquired shares of common stock or by relinquishing a portion of the shares otherwise issuable upon exercise or vesting.  If an option is exercised and payment is made in shares the Participant already owns, there generally is no taxable gain or loss to the Participant other than any gain recognized as a result of exercise of the option, as described above.  A number of new shares equal to the number of shares transferred to pay the exercise price will have a basis equal to the basis of the transferred shares and the same holding period as the transferred shares.  (If ISO shares are used to exercise a nonqualified option, a number of the new shares equal to the number of ISO shares transferred to pay the exercise price of the nonqualified option will also be treated as ISO shares subject to the same holding periods as the original ISO shares.)  The remainder of the new shares will have a new holding period and a basis equal to (i) for nonqualified options, the fair market value of those shares on the exercise date or (ii) for ISOs, zero.

Special Tax Provisions.  A Participant will also be subject to a 3.8 percent tax on the lesser of (i) the Participant's "net investment income" for the relevant tax year and (ii) the excess of the Participant's modified adjusted gross income for the taxable year over a certain threshold.  Net investment income generally includes net gains from the disposition of shares.  Under certain circumstances, the accelerated vesting, cash-out or accelerated lapse of restrictions on awards in connection with a change in control of the Company may be deemed an "excess parachute payment" for purposes of the golden parachute tax provisions of Section 280G of the Code, the Participant may be subject to a 20 percent excise tax, and the Company may be denied a tax deduction.

INFORMATION REGARDING OUTSTANDING STOCK-BASED AWARDS

The following table summarizes information regarding shares of Common Stock that may be issued upon exercise of stock options, warrants, and rights under the Company's equity compensation plans and arrangements as of April 15, 2020. See "Additional Equity Compensation Plan Information" below for comparable information as of December 31, 2019. The table below does not reflect the 375,000 shares of Common Stock that would be issuable in the event that the 2020 Plan is approved by the Company’s stockholders at the Annual Meeting.  The 470,871 shares shown in column C below that currently remain available for issuance under the 2015 Plan will no longer be issuable when the 2015 Plan expires on May 27, 2020, and no additional awards will be granted under the 2015 Plan after April 15, 2020.  On April 15, 2020, there were 7,537,056 shares of the Common Stock outstanding.  The closing sale price of the Common Stock on April 15, 2020, was $41.53 per share.

As of April 15, 2020, outstanding awards under the Company’s stock incentive plans were as follows:

  ITEM 42 – ADVISORY VOTE TO APPROVE COMPENSATION OF OUR EXECUTIVE OFFICERS

The Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010 (the "Dodd-Frank Act") included a provision that requires public companies to hold an advisory stockholder vote to approve or disapprove the compensation of their named executive officers. The Dodd-Frank Act also included a provision providing stockholders of a public company the opportunity to vote, on an advisory basis, on how frequently they would like the company to hold an advisory vote on the compensation of executive officers. At the 2017 annual meeting, the Company's stockholders approved the Board's recommendation that an advisory vote on executive compensation be conducted annually. Accordingly, we are conducting an advisory vote to approve the compensation of the Company's executive officers again this year. Unless the Board changes its policy, the next “say on pay” advisory vote will be held in 2021.2022.

The Compensation Committee believes that executive compensation should align with the stockholders' interests, without encouraging excessive or unnecessary risk. This compensation philosophy and the program structure approved by the Compensation Committee are central to the Company's ability to attract, retain, and motivate individuals who can achieve our goals and provide stability in leadership. Our philosophies and goals with respect to compensation are explained in detail below under the subheading "Executive Compensation – Compensation Discussion and Analysis – Compensation Philosophy and Objectives." A detailed description of compensation paid to our named executive officers in 20192020 follows that discussion and analysis.

This advisory vote, which is not binding on the Company, the Compensation Committee, or the Board, is intended to address the overall compensation of our executive officers and the policies and practices described in this proxy statement. The Board and the Compensation Committee value the opinions of our stockholders and will take into account the outcome of the vote when considering future executive compensation arrangements.

The Board of Directors unanimously recommends that you vote, on an advisory basis, FOR the following resolution:

"RESOLVED, that the compensation paid to our named executive officers, as disclosed in this proxy statement pursuant to Item 402 of Regulation S-K adopted by the SEC, including the Compensation Discussion and Analysis, executive compensation tables and accompanying footnotes and narrative discussion, is hereby approved. "

The above-referenced disclosures appear below under the heading "Executive Compensation" in this proxy statement.

The above resolution will be deemed to be approved if it receives the affirmative vote of a majority of the votes cast at the Annual Meeting. Abstentions and broker non-votes will have no effect on the outcome of the vote.

EXECUTIVE COMPENSATION

Compensation Discussion and Analysis

Compensation Philosophy and Objectives. The Compensation Committee (for purposes of this section, the "Committee") has responsibility for establishing, implementing, and continually monitoring adherence with the Company’s compensation philosophy. The goal of the Committee is to ensure that the total compensation paid to the Company’s executive officers is fair, reasonable, and competitive.

The Committee believes that the most effective executive compensation program is one that is designed to reward the achievement of specific annual and long-term strategic goals by the Company. The principles underlying our compensation policies are:

At the 20192020 annual meeting of stockholders, more than 97%94% of the votes cast with respect to the advisory vote on executive compensation approved the compensation of the Company's named executive officers. The Committee took this indication of support into consideration in reviewing the Company's executive compensation program. Our executive compensation program processes are consistent with those established by the Committee and are monitored by the Company’s finance functions.

2019Peer Group and Survey Data for Comparison Purposes. For several years, the Committee has retained Mercer, a nationally recognized compensation consultant, to provide advice to the Committee regarding the structure and implementation of the Company's executive compensation program.  In late 2018, the Committee asked Mercer to prepare an updated analysis of executive compensation data for all executive officer positions.  In consultation with the Committee, Mercer developed an updated peer group for purposes of comparing the Company's executive compensation with similarly sized companies in the human resources and employment services and related industries.  At the Committee’s request, Mercer added two insurance companies, James River Group Holdings, Ltd., a casualty insurer and reinsurer, and United Fire Group, Inc., a property and casualty insurer, and four companies were removed from the group.

Members of the revised peer group include:

The peer group was developed in consultation with Mercer without consideration of individual company compensation practices, and no company was included or excluded from the peer group due to paying above-average or below-average compensation.  Based on its analysis of the peer group and survey data in 2018, Mercer advised the Committee that the Company’s overall compensation levels for all executive officer positions were at approximately the median. The executive compensation approved by the Committee in 2020 took the 2018 survey data into account. The Committee has asked Mercer to update the peer group, conduct another survey of executive compensation among the Company’s peers, and provide a report to the Committee of its findings in the third quarter of 2021.

2020 Executive Compensation Components. For the fiscal year ended December 31, 2019,2020, the principal components of compensation for executive officers were:

Base Salary

Salary levels of executive officers are reviewed periodically by the Committee and the CEO as part of the performance review process, as well as in connection with a promotion or other change in job responsibility. In determining base salaries for executives in 2019,2020, the Committee primarily considered:

Based on the foregoing factors,In March 2020, the Committee determined not to adjust the annualapproved 2020 executive officer base salary levels as follows: Mr. Kramer, $725,000; Mr. Blotz, $500,000; and Mr. Harris, $350,000. Mr. Blotz’s salary was unchanged from 2019. The salary levels for anyMessrs. Kramer and Harris reflected their promotions to Chief Executive Officer and Chief Financial Officer, respectively, effective March 5, 2020. In August 2020, the Committee approved a 2020 base salary level of $325,000 for Mr. Potts in connection with his hiring as General Counsel effective September 16, 2020. The Committee did not approve changes in the Company’s executive officersbase salaries for 2019.Michael Elich and Heather Gould from 2019 due to their departures from the Company in March and April 2020, respectively.

Annual Cash Incentive Compensation

The Company's executive officers were eligible to receive annual cash bonuses following yearend for services during 2019. The Committee set the target bonus amounts in April 2019 at 100% of base salary for Mr. Elich and 80% of base salary for the other executive officers. Of the total bonus opportunity, 75% was awarded under the Company'sCompany has an Annual Cash Incentive Award Plan (the “Annual Incentive Plan”) that provides for annual awards of cash compensation to the Company’s executive officers based on the achievement of objective corporate performance goals selected by the Committee. In addition, the Committee typically awards discretionary bonuses based on each officer’s individual performance during the year.  The other 25% of the total bonus opportunity was reserved for award inis typically divided such that 75% relates to achievement of corporate performance goals and 25% to individual performance.  Following yearend, the Committee's discretion based on its assessment of each officer'sCommittee determines the extent to which the corporate and individual performance during 2019.

Achievement above or below established target levels for the corporate financial metrics results in an upward or downward adjustment in the cash incentive amount payable for corporate level goals. The adjustment is calculated based on a defined factor (2.5% for 2019) multiplied by the percentage by which the actual achievement of a given metric is above or below the target level. If the Company fails to achieve a specified financial target at the 80% level or above, no part of the cash incentive associated with that metric is earned. The maximum cash incentive payable is 200% of the target amount.goals were achieved. An executive must remain employed by the Company through the date of the Committee's determination of performance to be eligible to receive annual cash incentive payouts.

In April 2019,March 2020, the Compensation Committee determined thatset the corporate portiontarget bonus amounts at 100% of the annual cash incentive would be based 50% onbase salary for Mr. Kramer and at 80% of base salary for Messrs. Harris and Blotz.  The target amounts related to achievement of corporate performance goals were as follows:  Mr. Kramer, $543,750; Mr. Harris, $210,000; and Mr. Blotz, $300,000. The target bonus amounts tied to corporate financial metrics preliminarily approved by the Committee were as follows: gross billings of $6,382,717,578; net income of $39,408,052; and 50% on achievementgross margin as a percentage of gross billings of 3.21%, with each goal weighted equally. The cash payouts were to be subject to adjustment on a sliding scale based on a 2.5% increase or decrease for each percentage by which the actual achievement of a given metric was above or below the target level. Payouts for a given performance target would be 50% at the 80% achievement level and set target levels200% at an achievement level of achievement.  At its meeting on February 24,140% or above, with no payout at an achievement level below 80%.

In June 2020, the Committee reviewed the Company'sCompany’s financial resultsperformance for 2019the first five months of the year, which indicated that, due to the impact of the pandemic, payouts tied to the objective corporate financial metrics approved earlier in the year could be as low as zero.  Discussion ensued regarding the advisability of revising the 2020 cash incentive targets to focus on performance during the second half of the year.  The Committee asked management to present possible alternative approaches for its review at its next meeting. In considering the potential revision of corporate performance targets for 2020, the Committee’s primary focus was on creation of shareholder value. Accordingly, it directed that a revised set of targets provide for target and concluded that growthmaximum payouts substantially below the original targets approved in March 2020, including a lower adjustment factor.

Accordingly, in July 2020, the Committee approved revised corporate financial metrics for the 2020 cash incentives payable under the Annual Incentive Plan.  The revised metrics relate to the Company’s performance in the second half of 2020 and were as follows: gross billings in 2019 was 5.65%, comparedof $5,546,843,098; net income of $19,403,629; and gross margin as a percentage of gross billings of 3.0%; with each goal weighted equally.  The revised target payout related to the financial metrics was 50% of the original target goalpayout. The adjustment factor was also reduced to 1.5% upward or downward for each percentage of 8.0%achievement above or below the target level and the maximum payout was reduced to 150% from 200%. Therefore,For additional information, see the Grants of Plan-Based Awards table below.

In March 2021, the Committee determined that each of the revised corporate goal for gross billings had not been attained at the minimum threshold level of 80%, such that no target bonus amounts tied to that goal were payable. The Committee then determined that growth in net income for 2019 was 26.9%, compared to the target goal of 11.7%.  Therefore, the corporate net income goalfinancial metrics had been achieved at 229%above target as follows:  gross billings of the target goal.  With the 2.5% adjustment for each percentage point above the 100% level, the multiplier factor was substantially above, and limited to,$5,924,539,159, resulting in a payout at the maximum of 150% of target; net income of $33,765,493, also resulting in a payout at 150% of 200%target; and gross margin as a percentage of the target award. Actual cash incentivegross billings of 3.09%, resulting in a payout at 113% of target.  The actual payouts are shown in the "Non-EquityNon-Equity Incentive Compensation Plan Compensation" column inof the Summary Compensation Table below.

The Committee also approved target cash incentivebonus amounts in April 2019 tied to the subjectivefor individual performance of the executive officers and representing 25% of the total bonus opportunity. In February 2020, the Company’s CEO met withapproved by the Committee to present his views regarding the performance of each member of the executive team other than himself.  He stated that six of the goals by which he assessed the team’s performance related to companywide initiativesin March 2020 were as follows:  Mr. Kramer, $181,250; Mr. Harris, $70,000; and comprised approximately 70%-80% of each officer’s performance for purposes of his evaluation. The goals focused on transparency, assuring the accuracy of financial records, implementation of the Company’s product framework, organizational readiness in the face of changing market conditions, progress in implementing the Company’s five-year strategic plan, and adoption of improved methods for product delivery.  Mr. Elich commented on the executive management team’s progress with respect to each of the six goals, stating that, in his view, the executive team had met his expectations in 2019.  He also noted that the team had been required to absorb the responsibilities assigned to Mr. Vaughn prior to his retirement onBlotz, $100,000. In June 30, 2019.  At its meeting in late February 2020, the Committee approved payoutsindividual performance goals recommended by Mr. Kramer related to the discretionary target bonuses.  Mr. Kramer’s goals focused on development and implementation of 100%strategic initiatives for the Company, including building an effective management team, executing an expense synergy plan, and enhancing the Company’s fronted insurance program. The goals for Mr. Harris included overseeing action steps to assist clients in accessing federal and state program benefits adopted in response to the pandemic, designing a more effective benefits program for the Company’s employees, and improving the efficiency and effectiveness of the Company’s financial and accounting functions.  Mr. Blotz’s goals centered on developing improved marketing strategies and relationships with the Company’s referral partners. In connection with his hiring as General Counsel effective September 16, 2020, the Committee approved a target bonus for Mr. Potts related to individual performance of $125,000. In early March 2021, the Committee approved full payouts of the target cash incentive amounts tied to individual performancediscretionary bonus amount for Mr. Elich, Mr. Blotz, and Ms. Gould, and 125% of the target cash incentive amount tied to individual performance for Mr. Kramer, as shown in the "Bonus" column in the Summary Compensation Table below.  each executive officer.

Long-Term Equity Incentive Compensation

TheIn April 2020, due to the imminent expiration of the Company’s 2015 Stock Incentive Plan, the Committee oversaw the development of a new 2020 Stock Incentive Plan (the “2020 Plan”), which received stockholder approval at the 2020 annual meeting. Mercer made recommendations to the Committee regarding development of the new plan, including the incorporation of provisions corresponding to leading practices in executive compensation and corporate governance that had developed since approval of the previous plan in 2015. Among other types of awards, the 2020 Plan permits grants of stock options, RSUs and performance shares.

In 2020, the Committee continued its practice of making annual grants of restricted stock units ("RSUs") and performance share awardsRSUs to the Company's executive officers under the Company's 2015 Stock Incentive Plan in 2019.  The Committee determined that the target dollar value of the awards, based on the closing sale price of the Common Stock on the date of grant, should be equal to 170% of annual base salary for Mr. Elich and 130% of annual base salary for the other executive officers. The Committee determined that the RSU grants would equal 75% of the total dollar value and the target level of performance shares would represent 25% of the total dollar value.  

The Committee believes that RSUs provide a near-term opportunity to receive an ownership stake in the Company, thus serving as a significant incentive aligning the long-term interests of the executive team with the interests of the Company's stockholders. Each RSU represents a contingent right to receive one share of Common Stock. The RSUs granted to executive officers typically vest in four equal annual installments. The Committee fixed the dollar value of the annual RSU awards to executive officers granted on July 1, 2020, based on the closing sale price of the Common Stock on the date of grant, as follows: Mr. Kramer, $580,000; Mr. Harris, $280,000; and Mr. Blotz, $487,500.  In addition, Mr. Potts received awards with a dollar value of $250,000 effective with his hiring as General Counsel in September 2020. In November 2020, the Committee approved a one-time grant of RSUs to Mr. Harris in recognition of the increased responsibilities and demands of his position following his promotion to Chief Financial Officer in March 2020, as well as to serve as a retention incentive. The awards are shown in the “All Other Stock Awards” column of the Grants of Plan-Based Awards table below.

The vesting ofDue to the uncertainties stemming from the pandemic and the resulting difficulty in developing performance share awards granted in 2019 is conditioned on attaining specified target cumulative amounts of gross billings and net incomegoals for the three-year performance period ending December 31, 2021.  The target dollar levels2022, the Committee deferred consideration of awards of performance shares granted on May 31, 2019, were: Mr. Elich, $340,000; Mr. Blotz, $162,500; Mr. Kramer, $162,500; and Ms. Gould, $162,500,for the executive officers from 2020 to 2021, with 50%the target dollar values of the awards to be based in part on a two-year performance shares tied to achievement of each financial metric. Target award amounts are subject to upward or downward adjustment by 2.5% for each one percent by which the actual achievement ofperiod ending December 31, 2022, and in part on a given financial metric is above or below the target level, but not less than 80% of the target level or more than 140% of the target level. If achievement is below the 80% level, no part of the target award tied to that financial metric is payable. At the 80% level, 50% of the target award for the related financial metric would be paid. The maximum payout is 200% of a target award.  The awards in terms of numbers of shares are shown in the “Estimated future payouts under equity incentive plan awards” column of the Grants of Plan-Based Awards table below.three-year performance period ending December 31, 2023.

In February 2020,early March 2021, the Committee reviewed the achievement of performance goals for performance share awards granted to Messrs. Kramer and Blotz in early 2017.2018.  The awards had been tied to the achievement of EBITDA, net income and gross billings targets for the three years ended December 31, 2019,2020, with each factor weighted equally.  The Committee determined that the EBITDA goal had been achieved at the 90.8% level; the downward adjustment of 2.5% for each 1% below target yielded a payout of 59.6% of the target award tied to EBITDA.  It determined that the net income goal had been achieved at the 118.0%100.4% level; the upward adjustment of 2.5% for each 1% belowabove target yielded a payout of 145.0%100.9% of the target award tied to net income.  Finally, theThe Committee determined that the gross billings goal had been achieved at the 88.2%87.7% level, yielding a payout of 70.5%69.1% of the target award tied to gross billings yielding anfollowing downward adjustment. The overall payout oftotaled approximately 98%85.0% of the target awards.  The performance share awards were settled on February 26,March 1, 2020, in the following share amounts:with each of Mr. Elich, 6,203;Kramer and Mr. Blotz 2,965; Mr. Kramer, 2,372; and Ms. Gould, 2,372.

As described in more detail under “Item 3—Approvalreceiving 1,680 shares of 2020 Stock Incentive Plan” above, the Board, at the recommendation of the Committee, has directed the submission of a new 2020 Stock Incentive Plan to a vote of the stockholders at the Annual Meeting. During 2019, the Committee engaged Mercer to evaluate the Company’s current long-term incentive program and advise the Committee regarding appropriate changes in the structure of the program in light of recent market trends, based in part on the Company’s peer group and a survey of several additional insurance companies. Among other matters, the Committee determined that, beginning in 2020, stock-based awards to the Company’s CEO will be split 50/50 between RSUs and performance shares based on grant date fair value. Mercer also made recommendations to the Committee regarding development of the new plan, including the incorporation of provisions corresponding to leading practices in executive compensation and corporate governance that have developed since approval of the current plan in 2015.common stock.

Deferred Compensation Plan

Under the Company’s Nonqualified Deferred Compensation Plan adopted in 2017, executive officers and other participants may defer receipt for income tax purposes of up to 90% of salary, as well as up to 100% of bonuses and other compensation. Deferred amounts are credited to each participant's account and adjusted to reflect amounts of income, gain, or loss as if the amounts credited to such accounts had been invested in investment funds designated under the plan and selected by the participant.  The Committee also approved the establishment of a Rabbi trust under which compensation deferred at the election of participants is deposited in trust and held separately from the Company's other assets, subject to the claims of the Company's creditors in the event of its bankruptcy or insolvency.  Although the Company does not make cash matching contributions to participants’ accounts under the plan, RSUs that cliff vest five years following the grant date are awarded each January 1 and July 1, with a matching award of RSUs equal to 35% of the amount deferred into a participant's account during the preceding six months, up to a maximum value of $75,000 per year.  The RSU awards during 20192020 are shown in the Grants of Plan-Based Awards table below.  Additional information about the deferred compensation plan is included under "Nonqualified Deferred Compensation" below.

Retirement Benefits

Employees, including executive officers, may participate in the Company's 401(k) defined contribution plan. The Company matches each employee's contributions at a rate of 100% on the first 3% of salary deferrals and 50% on the next 2% of salary deferrals, with a maximum Company-paid match of $11,200.$11,400. All executive officers other than Mr. Potts participated in the 401(k) plan in 2019.2020.

Agreements with Executive Officers

In May 2019, the Company entered into an agreement with Mr. Vaughn to provide for his transition following his retirement as an executive officer of the Company on June 30, 2019.  In April 2020, the Company entered into separation agreements with Mr. Elich and Ms. Gould in connection with their departures from the Company.  

The Company also entered into employment agreements with its three current executive officersMessrs. Kramer, Harris, and Blotz in April 2020, and with Mr. Potts in August 2020.  The employment agreements provide for the payment of severance benefits upon termination of the executive’s employment for specified reasons.  Each agreement includes the executive’s agreement not to compete with the Company for a specified period following termination. The Committee approved the agreements with the goal of providing the Company's stockholders with greater assurance of stability within senior management. The employment agreements replaced prior agreements that provided for severance benefits only in the event of termination for specified reasons following a change in control of the Company.

The Company has also entered into agreements with Messrs. Kramer, Blotz, Harris, and BlotzPotts that provide, in the event of the executive's death, for the Company to make a lump sum payment to the executive’s designated beneficiary. The agreements are intended to provide a benefit to each executive’s heirs in the event of his death while employed by the Company.  TheIn 2020, in connection with the restructuring of the executive team, the Committee has authorized the Companyapproved increased death benefits from $800,000 to enter into a similar agreement with$2,000,000 for Mr. Harris.Kramer and of $1,000,000 for each of Messrs. Harris, Blotz and Potts.

The Committee approved alleach of the foregoing agreements, which are described under “Information Regarding Agreements with Executive Officers” below.

Compensation Recovery (“Clawback”) Policy. The Company demands that its employees, officers and directors conduct business in accordance with the highest standards of integrity and personal and professional ethics. As an adjunct to this standard of conduct, the Board has adopted a compensation recovery (“clawback”) policy that applies to its executive officers. Under this policy, the Compensation Committee may instruct the Company to seek to recover payments of incentive compensation if the performance measure upon which the award was based is subsequently restated or otherwise adjusted in a manner that would reduce the size of the award or payment. If the incentive compensation was tied to a subjective measure, the Compensation Committee will decide how much, if any, of the compensation the Company should seek to recover. The Compensation Committee may also direct the Company to seek recovery of up to the entire amount of any incentive compensation awarded for a period during which a covered executive committed a significant legal or compliance violation. A copy of the policy is available on the Company's website at www.mybbsi.comwww.BBSI.com in the "Investors" section under “Governance.”

Tax Deductibility of Executive Compensation.  Section 162(m) of the Internal Revenue Code limits the amount that the Company may deduct for income tax purposes for compensation paid to our executive officers to $1,000,000 per person. Prior to the enactment of the Tax Cuts and Jobs Act by Congress in late 2017, performance-based compensation that met the requirements of Section 162(m) and regulations thereunder was excluded from the limit. This exception was repealed on a prospective basis. Accordingly, subject to certain limitations, effective with the 2018 tax year, all compensation paid to a named executive officer or other covered employee in excess of $1,000,000 is non-deductible, other than qualifying performance-based compensation paid under written binding agreements in effect as of November 2, 2017. No compensation shown in the Summary Compensation Table below qualified as performance-based compensation under Section 162(m). The performance shares that vested in February 2020 did qualify as performance-based compensation for purposes of Section 162(m). In February 2019, the Compensation Committee amended and restated our Annual Cash Incentive Award Plan to remove references to Section 162(m).

Peer Group and Survey Data for Comparison Purposes. For several years,Compensation Committee Report

The Compensation Committee is charged with carrying out the Committee has retained Mercer, a nationally recognizedBoard's overall responsibilities relating to compensation consultant, to provide advice to the Committee regarding the structure and implementation of the Company's executive compensation program.  In late 2018,officers. The Compensation Committee has reviewed the Committee asked Mercer to prepare an updated analysissection headed "Compensation Discussion and Analysis" and has discussed its contents with members of executive compensation data for all executive officer positions.  In consultation with the Committee, Mercer developed an updated peer group for purposes of comparing the Company's executive compensation with similarly sized companiesmanagement. Based on its review and discussions, the Compensation Committee has recommended to the Board of Directors that the section headed "Compensation Discussion and Analysis" be included in the human resourcesCompany's Annual Report on Form 10-K for the year ended December 31, 2020, and employment services and related industries.  At the Committee’s request, Mercer added two insurance companies, James River Group Holdings, Ltd., a casualty insurer and reinsurer, and United Fire Group, Inc., a property and casualty insurer.  Four companies were removed fromCompany's proxy statement on Schedule 14A.

Submitted by the group:  CEB Inc., CDI Corp., Hill International Inc., and Wageworks, Inc.  The first two were acquired and are no longer public companies. In addition, ASGN Incorporated was previously known as On Assignment Inc.

MembersCompensation Committee of the revised peer group include:Board of Directors:

The peer group was developed in consultation with Mercer without consideration of individual company compensation practices, and no company was included or excluded from the peer group due to paying above-average or below-average compensation.

Based on its analysis of the peer group and survey data, Mercer advised the Committee that the Company’s overall compensation levels for all executive officer positions were at approximately the median. Accordingly, the Committee did not make any changes in base salaries or target compensation levels for the Company’s executive officers in 2019 compared to 2018 levels.

Summary Compensation Table

The following table sets forth information regarding compensation received by the persons servingeach individual who served as an executive officersofficer of the Company during 2019.2020.

Incentive Compensation

The following table sets forth information regarding awards under the Cash Incentive Plan, the 2020 Plan, and the 2015 Plan to the named executive officers during the year ended December 31, 2019.2020.

Grants of Plan-Based Awards for the Year Ended December 31, 20192020