'Fat cat' pay | FTSE 100 bosses rake in £901 an HOUR

FTSE 100 bosses rake in £901 an HOUR

By 5pm today, the typical FTSE 100 CEO will have already taken home the equivalent of what a typical UK worker makes in a year, a new study has revealed – The Mirror reported.

The data from the Chartered Institute of Personnel and Development (CIPD) and think-tank the High Pay Centre found that some FTSE 100 chief execs – who take home the average staff salary within three working days – raked in the equivalent of £901 an hour according to 2018 data, against the hourly wage of £14.37 for the average full-time employee.

The figures come as large publicly listed firms with more than 250 UK employees are now required to disclose the ratio between CEO pay and that of their average worker, as well as justifying the reason for the ratio.

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Peter Cheese, Chief Executive at the CIPD, said that this is the first year that businesses are properly being held to account over executive pay. He said: “Pay ratio reporting will rightly increase scrutiny on pay and reward practices, but reporting the numbers is just the start.

“We need businesses to step up and justify very high levels of pay for top executives, particularly in relation to how the rest of the workforce is being rewarded.

“Greater fairness and openness in pay is essential in building trust, amongst employees as well as external stakeholders and investors,” Cheese added.

Some of the highest paid chief execs included Persimmon’s former CEO Jeff Fairburn (£38.9million) who stepped down in 2018, Royal Dutch Shell’s CEO Ben van Beurden (£17.8million) and Rakesh Kapoor (£15.2million) who left Reckitt Benckiser last year.

Luke Hildyard, Director of the High Pay Centre, added: “CEOs are paid extraordinarily highly compared to the wider workforce, helping to make the UK one of the most unequal countries in Europe.

“New reporting requirements mean that publicly listed firms will have to be more transparent over how and why they reward their CEOs relative to the wider workforce. Hopefully this will lead to a more sensible balance between those at the top and everyone else,” Hildyard added.

Companies in the FTSE 100 include Tesco, Lloyds Bank and Barclays Group.

The CIPD and the High Pay Centre are urging employers not to treat new reporting requirements as a mere ‘tick-box’ exercise and rather use it as an opportunity to fully justify inflated executive pay.

Business Secretary Andrea Leadsom said that today’s ‘eye-watering’ figures will be hard-hitting for the hard-working people in the UK.

“The numbers are better than they were – down a quarter since 2012 and 13% on average since last year – but the situation is still concerning, especially in those cases where executives have been rewarded despite failing their employees and customers,” Leadsom concluded.

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