Top execs paid 100 times average worker
A study by the pay analysts, Incomes Data Services, has established that top executives of Britain’s largest companies are being paid over 100 times as much as the average worker.
The pay for Chief Executives is twice what it was 5 years ago, now at a staggering £3.2 million while the average wage-earner was paid £30,000 last year. Consequently, these bigwigs receive more than double in one week what the average person does in one year.
In 2006, the top bosses of companies in the FTSE-100 index rewarded themselves rises averaging 16% – 5 times the average 3.5% given to their employees over the same period.
The figures caused outrage among trade union leaders and politicians who branded the pay gap ‘grotesque’. The figures also show that bonuses for chief executives have more than doubled while most workers have received far more modest rises. Several families on ordinary salaries are finding it difficult to meet mortgage repayments and household bills.
Brendan Barber, TUC general secretary, said these top execs clearly have no shame. They are paying themselves far bigger rises than they are prepared to pay their staff, while preaching to us about the need for low taxes. Mr Barber added that it was hard to believe that chief executives were working twice as hard as 5 years ago.
In 2000, the average FTSE-100 chief executive was paid 39 times the national average. The figure today is 109 times. The FTSE-100 share index, which values the firms, was higher in 2000 and 2001 than it is today so the change clearly cannot be attributed to performance or company profits.
Sir Terry Leahy, the chief exec of Tesco, received earnings of £6.8 million in 2006. His grocery managers earned £18,500, while shelf-stackers earned £11,100.
In addition to chief executives, other FTSE-100 directors are also benefiting. A typical finance director earned £1.6 million last year while heads of company divisions and chairmen earned £1.7 million.