Fat Cat Tuesday

Today 6 January is "Fat Cat Tuesday" By only the 2nd working day of the first month of the year, the average CEO of a FTSE 100 company will have received more pay that the average UK worker will earn in the entire year.

Check out TUC press release

"TUC General Secretary Frances O’Grady said: “It’s a stark reminder that while the average worker is £50 a week worse off than in 2010, boardroom pay gets bigger and bigger every year.

“We urgently need a change of course to put wage growth for all workers at the heart of Britain’s economic plan – if not then people’s living standards will not recover and the economy will remain in the danger zone.”

also hat tip High pay centre

Tired of Banker’s Bonuses? It’s about time we all Have Our Say on High Pay!

"Over the past decade, while executive pay has grown by over 323%, the average UK earnings have grown by a mere 54%. Across the nation, ordinary workers have felt outraged by the continuing gap between the lowest and the highest paid earners but felt powerless to do anything. This growing inequality is particularly distasteful considering the current economic situation, with high unemployment and pension cuts creating hardship for many.

But how can we tackle this culture of excess? Vince Cable thinks that it is up to the shareholders of companies to hold the boardroom to account. However, despite the vast increases in bonuses and single performance incentives, not to mention “Golden Hellos” (a hefty sum paid to attract talent to the company), average levels of shareholder dissent have been stuck at around 9%, with outright defeat for these pay packages at annual general meetings remaining a rare spectacle.

We all have the power to influence these shareholders, who are mainly compromised of institutional investors. These anonymous ‘institutions’ are, among others, the pension funds and insurance companies who look after our retirement savings. In other words, the owners of corporate Britain are no longer a few rich individuals: they include anyone with pension savings, or around 11 million of us. This is our money!

The responsible investment charity FairPensions has launched ‘Your Say on HighPay’ at www.fairpensions.org.uk/highpay This online action tool will email your pension fund or ISA provider telling them you want them to vote against excessive pay – and asking them to let you know about it. 

Whether the ‘Shareholder Spring’ proves to be a one-season wonder or something more permanent may yet be up to us". (Great guest post by MM).

While I was away...

I'm catching up on my RSS feeds and emails...

War on Want report "Stitched up" on the gross exploitation of women workers in the Bangladeshi garment industry.  The research is spot on but I was concerned that recommendations failed to mention any action or pressure on pension funds or insurance companies who own the companies that make money out of such misery.  Hat tip Phil T.

Tom P at Labour & Capital on the recent report on directors pensions by the High Pay Commission.  Double standards in boardrooms. Not only are directors paid far more than their workers but they build their pensions at a much higher rate - often with 1/30th DB schemes rather than 1/60th for their staff.

"A FTSE 100 director with a defined benefit pension could be expected to receive a
median annual pension worth £174,963 on retirement. The annual median pension paid from a private sector defined benefit pension scheme was £5,860 for the rest of the work force".

Good to see "Labourhome" back after nearly 2 years offline. Welcome back Alex! I notice that they are moderating comments :)

Astonishing history link from normblog "Trumpeter Landfrey, a bugler in the Light Brigade at the Battle of Balaklava (October 25, 1854), sounds the charge again, playing a trumpet that was used at the Battle of Waterloo in 1815. The recording was made in 1890 and you can listen to it here. (Via.)".

Tribute at UNISONActive here to Newcastle City Branch Secretary and Northern Region Deputy Convenor, Kenny Bell, who died of cancer on August 14.  Kenny was quite simply a top trade unionist and will be sadly missed.   UNISONActive also has a link to this Guardian article on the true cost to workers of outsourcing which I will post further upon later this week.

Say on Pay

I’m having a bit of a “row” with Sunny Hundal at the moment over on Facebook about his support for a “High Pay Commission”. I think the idea is probably well meaning but just barking up the wrong tree.

A genuine review (or even call it a commission if you must) of the best way to tackle excessive executive pay would be welcome - but as soon as people started suggesting that this may result in maximum wage regulation ratios, 90% taxation and a national “incomes policy” - it is simply a non-starter and even a distraction.

By co-incidence PIRC and the Railway Pensions fund are holding this “Say on Pay” event next month on UK’s experience of shareholders vote on remuneration (trends in Executive Pay both pre and post company AGM votes, level of shareholder opposition to remuneration reports).

There is actually currently no legal reason why we cannot get real independent shareowner representatives on Company boards and remuneration committees.

Personally I feel that we can only really tackle excessive pay when we have effective industrial and shareowners democracy. Don’t forget that employee representation on Company Boards is relatively common in many parts of Europe. Why aren’t we talking about this issue?

There also needs to be better regulation and fairer taxation but a High Pay Commission as currently spun will achieve nothing and set us back. IMO.

I’m not suggesting that Tom P agrees with me on this issue but I like his blog “about me” statement

“I'm interested in getting the labour movement and the Left to understand the capital markets properly. There's plenty that needs fixing, but we need to get beyond simplistic anti-City and anti-business rhetoric to do it”.

The “left” have got to stop retreating to their “Bash capitalism” comfort bunker whenever financial policy comes up.