‘Fat Cat Wednesday’ shines spotlight on executive pay

By today, top bosses will have raked in more than the average worker earns all year, according to the High Pay Centre. Picture: John Devlin
By today, top bosses will have raked in more than the average worker earns all year, according to the High Pay Centre. Picture: John Devlin
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Top bosses will already have made more money by today than the typical worker will earn all year, new figures reveal.

Today has been dubbed “Fat Cat Wednesday”, as executives will pass the average salary of £28,200 by midday, said the High Pay Centre.

Working people deserve a fair share of the wealth they help create

Frances O’Grady

The think-tank said the figures confirm how pay differs “dramatically” for senior bosses compared with everyone else.

The median pay for a chief executive in a FTSE 100 company was almost £4 million in 2015 – or £1,000 an hour – compared to the national living wage of £7.20, said the report.

READ MORE: Bid to cut pay gap between boardroom and workers

The figure makes the “generous assumption” that top bosses work 12 hours a day, most weekends and take fewer than ten days holiday a year. The High Pay Centre estimated it would take about 28 hours work to pass the UK average wage.

High Pay Centre director Stefan Stern said: “Our new year calculation is not designed to make the return to work harder than it already is. But Fat Cat Wednesday is an important reminder of the continuing problem of the unfair pay gap in the UK.

“We hope the government will recognise that further reform to pay practices are needed if this gap is to be closed. That will be the main point in our submission to the business department in its current consultation over corporate governance reform.

“Effective representation for ordinary workers on the company remuneration committees that set executive pay, and publication of the pay ratio between the highest and average earner within a company, would bring a greater sense of proportion to the setting of top pay.”

TUC general secretary Frances O’Grady said: “Working people deserve a fair share of the wealth they help create. But while the pay of top executives has been rocketing up, the average weekly wage is still worth less than it was nine years ago.

“The Prime Minister must stick to her promise to tackle excessive pay at the top. And she should keep her commitment to put workers on company boards. This would help keep executive salary decisions grounded in common sense and fairness.”

READ MORE: Tackle the boardroom fat cats to head off populist backlash

Clive Lewis, shadow business secretary, said: “It is an outrage that, before Christmas trees have even been taken down, chief executives have already earned more in 2017 than most people will earn all year.

“But despite promising action, the Tories have watered down their promise to give shareholders binding votes on executive pay. Under this government, these grossly unfair pay patterns look set to continue.”

A spokeswoman for the Department for Business, Energy & Industrial Strategy said: “The government is committed to creating an economy that works for everyone.

“That’s why we’re actively consulting on a range of options to address concerns around excessive levels of executive pay, as part of our reforms to strengthen the UK’s corporate governance framework.”

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