'Fat Cat Friday': Top bosses have already earned as much as average workers will all year
Today is the day top bosses will have earned as much so far this year as the average worker will in 12 months.
Chief executives of leading UK companies are paid 133 times more than the average worker, new research for “Fat Cat Friday” revealed.
The average chief executive of FTSE 100 firms has a pay packet of £3.9 million, an 11% increase on a year ago, a report by the High Pay Centre think tank and the Chartered Institute of Personnel and Development (CIPD) suggests.
The pay increase means that top chief executives working a 12-hour day only need to work for 29 hours in 2019 to be paid the average worker’s annual salary, two hours fewer than in 2018, said the report.
Unions said the research showed that the Government needed to “redesign” the economy to make it fair.
The two organisations said the average FTSE 100 chief executive is paid just over £1,000 an hour, compared with the national living wage of £7.83 for adults.
The report said excessive pay and the culture of “superstar” chief executives was increasingly being seen as a failure of corporate governance, hitting trust in business leadership.
New regulations requiring large publicly-listed companies to publish the ratio between the pay of chief executives and workers created a “burning platform” for reform of remuneration committees, said the report.
Peter Cheese, chief executive of the CIPD, said the gap between top earners and the rest of the workforce was still too great.
He said: “Average pay has stagnated whilst top CEO reward has grown, despite overall slow economic growth and very variable business performance.
Luke Hildyard, director of the High Pay Centre, said: “Corporate boards are too willing to spend millions on top executives without any real justification, while the wider workforce is treated as a cost to be minimised.”
Rebecca Long-Bailey, shadow business secretary, said the report showed how “disgracefully skewed” the UK’s corporate culture had become in some circles.
She said: “The Tories have done nothing to address such blatant inequality and they continue to push real aspiration further and further from the grasp of the majority of people in Britain.”
TUC General Secretary Frances O’Grady said: “We need to redesign the economy to make it fair again and that means big reforms to bring fat cat pay back down to earth."
The Government said regulations that came into force this week mean "that for the first time the UK’s biggest companies must disclose and explain the ratio of their bosses’ pay to their average employee’s earnings - giving workers a stronger dialogue and voice in the boardroom and ensuring businesses are accountable for their executive pay."