85% Tax Rates For Pay Over £1m Should Be Re-Introduced Not To Bring In Revenue But To Deter Top Executive Greed Says GMB
This is a blatant case of market failure as managers are not worth 145 times average pay and they help themselves to vast sums simply because they can do so and no one stops them says GMB
GMB commented on the report from the High Pay Centre that FTSE 100 bosses are paid 145 times their average employee. See notes to editors for copy of press release from High Pay Centre.
Paul Kenny, GMB General Secretary, said "This is a blatant case of market failure as these managers are not worth this money.
The top managers help themselves to vast sums simply because they can do so and no one stops them.
85% tax rates for pay over £1m should be re-introduced not to bring in revenue but to deter such greed."
Contact: Kamaljeet Jandu 07956 237178 or Martin Smith 07974 251 823 of GMB press office 07921 289880
Notes to editors
High Pay centre press release dated Monday 18 August
FTSE 100 bosses paid 145 times their average employee
Britain's top executives are now paid around 143 times their average employee, according to analysis released today by the High Pay Centre think-tank.
The figures illustrate the dramatic rise in executive pay in relation to most UK workers over the past three decades. In 1998, the average FTSE 100 CEO was paid 47 times their average employee. Analysis of six major UK companies in 1980 found that CEOs were paid between 13 and 44 times their average employee.
The High Pay Centre compared pay for FTSE 100 Chief Executives recorded by companies in their annual reports to figures for average pay at each company, provided by Pensions and Investment Research Consultants (PIRC), in order to calculate the ratios.
The pay gap was highest at Randgold Resources, a Jersey headquartered-mining company listed on the London Stock Exchange, where CEO Mark Bristow earns nearly 1,500 times his employees, many of whom are miners based in Africa. WPP CEO Martin Sorrell took home a pay package nearly 800 times bigger than his employees, while Next boss Lord Wolfson was awarded pay worth 459 times as much as his average employee, but subsequently chose to distribute his bonus to staff.
10 highest pay ratios at FTSE 100 companies:
CEO Pay/£ Average worker pay
£ CEO/ average employee Pay multiple
Lord Simon Wolfson*
ASSOCIATED BRITISH FOOD
BRITISH AMERICAN TOBACCO
(*Donated bonus payment to staff )
Commenting on the figures, High Pay Centre Director Deborah Hargreaves said:
While Government figures confirm that wages for ordinary workers keep falling, it's clear that not everyone is feeling the pain.
When bosses make hundreds of times as much money as the rest of the workforce, it creates a deep sense of unfairness.
Britain's executives haven't got so much better over the past two decades. The only reason why their pay has increased so rapidly compared to their employees is that they are able to get away with it. The Government needs to take more radical action on top pay to deliver a fair economy that ordinary people can have faith in.
Notes to editors:
· All analysis is based on the companies' own figures, taken from their most recently-published annual reports - UK-listed companies are required to disclose an annual 'single figure' for the total pay awarded to their Chief Executive, as well as details of their number of employees and their total wage and salary costs. The High Pay Centre compiled the executive pay figures, while PIRC calculated the average employees pay for each company. Where companies provided figures in different currencies, we have converted to sterling using the exchange rate on the date of the company's financial year end.
· The Manifest/MM&K annual Director's Total Remuneration report estimated that pay received by the average FTSE 100 Chief Executive increased from £4.1 million to £4.7 million last year - http://blog.manifest.co.uk/2014/07/6533.html#sthash.TcDyBhKY.7ulFpd5j.dpbs
· The High Pay Centre's recent report 'Reform Agenda' called for a debate on more radical measures to address the widening gap between the super rich and everyone else, including a maximum pay ratio; worker representation on company boards and remuneration committees; and a legally-binding target for a reduction in inequality - http://highpaycentre.org/pubs/reform-agenda-how-to-make-top-pay-fairer
· These figures refer to CEO pay in relation to the average employee at the company in question, as opposed to the UK as a whole. The average pay realised by a FTSE 100 Chief Executive in 2013 is roughly 174 times that of the average UK worker.
Contact· Luke Hildyard, Deputy Director, the High Pay Centre:
o T:020 7922 7865/07859 015543
o E: firstname.lastname@example.org