Insurer Direct Line, which is under fire from union leaders for driving through “savage” job cuts, has awarded chief executive Paul Geddes a 27 per cent rise in his total pay package.
The group, spun out of Royal Bank of Scotland in 2012, defended its decision to hand Geddes an £835,000 bonus, insisting it needs to pay staff “competitively”, regardless of their rank.
With a basic salary of £760,000 and long-term incentive payments, Direct Line’s annual report shows Geddes earned a total remuneration package of £2.43 million last year, up from £1.9m in 2012.
The company last month posted a 70 per cent jump in annual pre-tax profits to £423.9m. In a bid to cut its running costs by £130m to about £1 billion this year, the firm said in June that it was planning to axe about 2,000 roles, on top of more than 1,200 job losses announced in 2012.
Priscilla Vacassin, who chairs the insurer’s remuneration committee, said: “Making redundancies is a tough decision, however we sometimes need to take steps like this to make the business sustainable.
“Employees, including executive directors, are continuously engaged to deliver against our plan and are provided with fair pay for the job, which takes into account the context of pay in the wider market as well as their individual performance.”
Direct Line has been attacked by the Unite union, which said the insurer has blocked it from negotiating on behalf of employees and described the cuts as a “savage bolt from the blue”.