Sunday 17 December 2017

It's Fat Cat Tuesday: When pay of top CEOs passes average salary of a worker

Dundee cat Zorro, who weighs 9.4kg, is taking part in the PDSA's Pet Fit Club (PA/PDSA)
Dundee cat Zorro, who weighs 9.4kg, is taking part in the PDSA's Pet Fit Club (PA/PDSA)

Top executives will have been paid more than the average annual salary of a worker by tomorrow, dubbed Fat Cat Tuesday, according to a new study.

Calculations by the the UK's High Pay Centre think tank showed that the pay of company executives returning to work in the new year will pass the UK average salary of £27,645 (€37,710) by late afternoon on Tuesday.

FTSE 100 chief executives were paid an average £4.96 million a year in 2014, and the report found that even if they are assumed to work long hours with few holidays, this is equivalent to hourly pay of more than £1,200.

The typical value of a FTSE 100 chief executive incentive award increased by nearly 50 per cent of salary since the previous year, while the annual pay of the average UK worker increased by just £445, from £27,200 to £27,645 in 2015, said the think tank.

The High Pay Centre said the figures will raise doubts about the effectiveness of government efforts to curb top pay by giving shareholders the power to veto excessive packages.

The High Pay Centre called for further measures to be taken, such as representation for workers on company remuneration committees that set executive pay, and publication of the pay gap between the highest and median earner within a firm.

High Pay Centre director Stefan Stern said: "Fat Cat Tuesday again highlights the continuing problem of the unfair pay gap in the UK.

"We are not all in this together, it seems. Over-payment at the top is fuelling distrust of business, at a time when business needs to demonstrate that it is part of the solution to harsh times and squeezed incomes, and is promoting a recovery in which all employees can benefit."

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