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Employee compensation plans | 12 Months Ended
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Dec. 31, 2022
Share-Based Payment Arrangement [Abstract] |
Employee compensation plans | Employee compensation plans The Company maintains various employee compensation plans for the benefit of its employees. Two types of employee compensation are granted under share-based compensation and cash-based compensation plans. Share-based Compensation Plans Oppenheimer Holdings Inc. 2014 Incentive Plan On February 26, 2014, the Company adopted the Oppenheimer Holdings Inc. 2014 Incentive Plan (the "OIP"). Pursuant to the OIP, the Compensation Committee of the Board of Directors of the Company (the "Committee") is permitted to grant options to purchase Class A Stock ("stock options"), Class A Stock awards and restricted Class A Stock (collectively "restricted stock awards") to or for the benefit of employees and non-employee directors of the Company and its subsidiaries as part of their compensation. Stock o ptions are generally granted for a five-year term and generally vest at the rate of 25% of the amount granted on the second anniversary of the grant, 25% on the third anniversary of the grant, 25% on the fourth anniversary of the grant and 25% on the six months before expiration. Restricted stock awards are generally awarded for a three or five year term and fully vest at the end of the term. Oppenheimer Holdings Inc. Stock Appreciation Right Plan Under the Oppenheimer Holdings Inc. Stock Appreciation Right Plan, the Company awards stock appreciation rights ("OARs") to certain employees as part of their compensation package based on a formula reflecting gross production and length of service. These awards are granted once per year in January with respect to the prior year's production. The OARs vest five years from grant date and settle in cash at vesting. Restricted stock - The Company has granted restricted stock awards pursuant to the OIP. The following table summarizes the status of the Company's non-vested restricted Class A Stock awards under the OIP for the year ended December 31, 2022:
| Number of Class A Shares Subject to Restricted Stock Awards |  | Weighted Average Fair Value Per Share |  | Weighted Average Remaining Contractual Life
Nonvested at beginning of year | 1,542,716 |  |  | $ | 26.59 |  |  | 2.2 years
Granted | 403,823 |  |  | 38.80 |  |  | 3.2 years
Vested | (156,477) |  |  | 26.17 |  |  | — |
Forfeited | (100,056) |  |  | 28.27 |  |  | — |
Nonvested at end of year | 1,690,006 |  |  | $ | 29.42 |  |  | 1.9 years
As of December 31, 2022, all outstanding restricted Class A Stock awards were non-vested. The aggregate intrinsic value of restricted Class A Stock awards outstanding as of December 31, 2022 was $71.5 million. During the year ended December 31, 2022, the Company included $11.5 million ($10.5 million in 2021 and $7.7 million in 2020) of compensation expense in its consolidated income statements relating to restricted Class A Stock awards. As of December 31, 2022, there was $23.1 million of total unrecognized compensation cost related to unvested restricted Class A Stock awards. The cost is expected to be recognized over a weighted average period of 1.9 years. As of December 31, 2022, the number of shares of Class A Stock available under the share-based compensation plans, but not yet awarded, was 386,290. On January 25, 2023, the Company awarded a total of 274,140 restricted shares of Class A Stock to current employees pursuant to the OIP. Of these restricted shares, 157,660 shares will cliff vest in three years and 116,480 shares will cliff vest in five years. These awards will be expensed over the applicable three or five year vesting period. Stock options - The Company has granted stock options pursuant to the OIP. There were 5,233 and 10,770 options outstanding as of December 31, 2022 and 2021, respectively. In the year ended December 31, 2022, the Company included $15,702 ($21,669 in 2021 and $25,300 in 2020) of compensation expense in its consolidated income statements relating to the expensing of stock options. OARs - The Company has awarded OARs pursuant to the Oppenheimer Holdings Inc. Stock Appreciation Right Plan. The following table summarizes the status of the Company's outstanding OARs awards as of December 31, 2022:
Grant Date |  | Number of OARs Outstanding |  | Strike Price |  | Remaining Contractual Life |  | Fair Value as of December 31, 2022
January 5, 2018 |  | 417,370 |  |  | $ | 27.05 |  |  | 5 days |  | $ | 15.28 |
January 11, 2019 |  | 490,016 |  |  | 26.45 |  |  | 1 year |  | 17.01 |
January 10, 2020 |  | 502,160 |  |  | 27.54 |  |  | 2 years |  | 17.47 |
January 11, 2021 |  | 606,159 |  |  | 32.16 |  |  | 3 years |  | 17.48 |
January 7, 2022 |  | 632,807 |  |  | 49.57 |  |  | 4 years |  | 11.79 |
Total OARs Outstanding |  | 2,648,512 |  |  |  |  |  |  |
Total weighted average values |  |  |  | $ | 33.58 |  |  | 3.0 years |  | $ | 15.68 |
The fair value as of December 31, 2022 for each of the OARs was estimated using the Black-Scholes model with the following assumptions:
|  | Grant Date
|  | January 5, 2018 |  | January 11, 2019 |  | January 10, 2020 |  | January 11, 2021 |  | January 7, 2022
Expected term (1) |  | 5 days |  | 1 year |  | 2 years |  | 3 years |  | 4 years
Expected volatility factor (2) |  | 12.966 | % |  | 37.031 | % |  | 36.412 | % |  | 43.974 | % |  | 39.848 | %
Risk-free interest rate (3) |  | 0.513 | % |  | 4.680 | % |  | 4.421 | % |  | 4.221 | % |  | 4.112 | %
Quarterly dividends (4) |  | $ | 0.6 |  |  | $ | 0.6 |  |  | $ | 0.6 |  |  | $ | 0.6 |  |  | $ | 0.6 |
(1) The expected term was determined based on the remaining life of the actual awards. (2) The volatility factor was measured using the weighted average of historical daily price changes of the Company's Class A Stock over a historical period commensurate to the expected term of the awards. (3) The risk-free interest rate was based on periods equal to the expected term of the awards based on the U.S. Treasury yield curve in effect at December 31, 2022. (4) Quarterly dividends were used to compute the expected annual dividend yield. As of December 31, 2022, 2,648,512 of outstanding OARs were unvested. As of December 31, 2022, the aggregate intrinsic value of OARs outstanding was $27.7 million. In the year ended December 31, 2022, the Company included $4.4 million ($20.6 million in 2021 and $8.5 million in 2020) in compensation expense in its consolidated income statements relating to OARs awards. The liability related to the OARs was $23.9 million as of December 31, 2022. As of December 31, 2022, there was $17.7 million of total unrecognized compensation cost related to unvested OARs. The cost is expected to be recognized over a weighted average period of 3.0 years. On January 6, 2023, 522,190 OARs were awarded to Oppenheimer employees related to fiscal 2022 performance. These OARs will be expensed over 5 years (the vesting period). Cash-based Compensation Plans Defined Contribution Plan The Company, through its subsidiaries, maintains a defined contribution plan covering substantially all full-time U.S. employees. The Oppenheimer & Co. Inc. 401(k) Plan provides that Oppenheimer may make discretionary contributions. Eligible Oppenheimer employees could make voluntary contributions which could not exceed $20,500, $19,500 and $19,500 per annum in 2022, 2021 and 2020, respectively. The Company made contributions to the 401(k) Plan of $4.3 million, $4.3 million and $3.5 million in 2022, 2021 and 2020, respectively. Deferred Compensation Plans The Company maintains an Executive Deferred Compensation Plan ("EDCP") and a Deferred Incentive Plan ("DIP") in order to offer certain qualified high-performing financial advisors a bonus based upon a formula reflecting years of service, production, net commissions and a valuation of their clients' assets. The bonus amounts resulted in deferrals for fiscal 2022 of $11.1 million ($12.8 million in 2021 and $10.0 million in 2020). These deferrals normally vest after five years. The liability is being recognized on a straight-line basis over the vesting period. The EDCP also includes voluntary deferrals by senior executives that are not subject to vesting. The Company maintains a Company-owned life insurance policy, which is designed to hedge a portion of the EDCP obligation. The EDCP liability is being tracked against the value of a benchmark investment portfolio held for this purpose. As of December 31, 2022, the Company's liability with respect to the EDCP, DIP and CMDP totaled $53.6 million and is included in accrued compensation on the consolidated balance sheet as of December 31, 2022. In addition, the Company is maintaining a deferred compensation plan on behalf of certain employees who were formerly employed by CIBC World Markets. The Company hedges this deferred compensation obligation with a portfolio of mutual fund investments. As of December 31, 2022, the Company's liability with respect to this plan totaled $16.8 million. On December 15, 2021, the Company adopted the Oppenheimer & Co. Inc. Investment Banking and Capital Markets Deferred Compensation Plan ("CMDP") for eligible employees in the Capital Markets business segment. An employee is eligible to participate in the Plan if the employee (i) is an Investment Banking Division employee of Oppenheimer with a title of Associate or above whose previous year’s salary and bonus exceeded $200,000, or (ii) is a professional working in the Oppenheimer Capital Markets Division (but not the Investment Banking Division) who is designated by the Plan Administrator (in its sole discretion) as eligible to participate in the Plan. The CMDP has both mandatory and elective contributions. The amount of compensation subject to mandatory deferral (“Bonus Deferral Credit”) is based on a schedule maintained by the Plan Administrator from time to time. The Bonus Deferral Credit vests ratably over a period of three years and is distributed upon vesting. For the elective portion, a participant is eligible if his or her base salary and bonus exceed $500,000 and he or she may elect to defer up to 50% of the total of his or her base salary and bonus amounts (“Elective Deferral Credit”) for a 5-year or 10-year period. The Elective Deferral Credit is 100% vested at all times. The Company provides a Matching Credit of 10% of the Elective Deferral Credit which vests on last day of the Performance Year (as defined in the CMDP) attributable to the Matching Credit. The Elective Deferral Credit and the Matching Credit are distributed in lump sums in the year following the fifth or tenth anniversary of the last day of the Performance Year (as defined in the CMDP), depending on the participant’s election. At December 31, 2022, the Company’s deferral related to the CMDP totaled $9.3 million which is comprised of Bonus Deferral Credits. Eligibility for Elective Deferral Credits begins in 2023 for elections made by December 31, 2021. The total amount expensed in 2022 for the Company's deferred compensation plans was $5.3 million ($18.4 million in 2021 and $18.1 million in 2020).

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