High pay 'will be a key issue in 2020'

FTSE 100 CEOs only need to work until just before 17.00 on Monday 6 January 2020 in order to make the same amount of money that the typical full-time employee does in the entire year. 

Analysis by The Equality Trust shows that the average CEO took home 90 times the salary paid to a senior teacher, 186 times the salary paid to a carer and 212 times the salary earned by a minimum wage worker. 

The Chartered Institute of Personnel and Development says high pay will be a key issue in 2020, as this is the first year that publicly listed firms with more than 250 UK employees must disclose the ratio between CEO pay and the pay of their average worker. Under changes to the Companies Act (2006), firms must now provide their CEO pay ratio figures and a supporting narrative to explain the reasons for their executive pay ratios. The first round of reporting will be seen in annual reports published in 2020.

Dr Wanda Wyporska, Executive Director of The Equality Trust commented: “Although the data show that FTSE 100 CEOs are earning marginally less this year, on average, than last year, the size of this pay inequality is still dangerously high. As we know from copious research, in countries with such high levels of inequality, such as we see here in the UK, we also see higher levels of mental and physical ill health, obesity, drug and alcohol addiction and lower levels of trust and educational attainment.

“When even the Business Secretary Andrea Leadsom says calls the pay gap 'concerning', we must demand greater action on tackling such great gaps in income. The UK Government has committed to reducing inequality, as Sustainable Development Goal number 10. The Equality Trust will be demanding action, as part of global protests, at an event in Westminster on 18 January 2020, along with other Fight Inequality Alliance partners. Around the world, people are taking to the streets because they have had enough of such inequality, watching the rich get richer while they struggle to put food on the table.”

In May 2019, The Equality Trust published From Pin Money to Fat Cats: Pay Inequality in the FTSE 100, which ranked the companies, sector-by-sector on CEO pay ratios, gender pay and bonus gaps, Living Wage accreditation, worker engagement and other indicators of inequality. A publicly available dashboard and second report are forthcoming in 2020.

* Information on the UK Fight Inequality protest here

* Read From Pin Money to Fat Cats: Pay Inequality in the FTSE 100  here

* The Equality Trust https://www.equalitytrust.org.uk/

* Chartered Institute of Personnel and Development https://www.cipd.co.uk/

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